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A common problem among a large majority of seniors is that they find they don't have enough savings to fund their retirement. Often, this leads those seniors to either return to work full-time or to take on part-time jobs to compensate for their insufficient savings. If you start saving early enough in your life, you can start to protect your retirement. However, you'll have to do more than just start a retirement account sooner.
In addition to saving more earlier in your life, you'll also have to protect the wealth that you do amass. This means exploring ways to diversify your retirement investments that won't put your existing savings at too great a risk. As you move closer to retirement age, more of your savings should be placed under these safer investment options. This will ensure you will have enough savings for your retirement even if your more aggressive investments suffer losses.
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How Can Seniors Protect Their Retirement Wealth?
There are a few different ways to protect your retirement wealth as you get older. Each method is slightly different, and the one you choose for yourself will depend on your situation.
Money Market Savings Accounts
A retirement money market account is similar to a regular savings account in that you'll earn interest on your balance. The deposits you make will be invested in low-risk investments with lower returns. This means you'll earn interest that's mildly better than that which you would earn in a standard savings account. This is not an ideal choice for older adults who want to continue growing wealth as they protect their savings.
Certificate of Deposit
Another option is a Certificate of Deposit or CD, but there are a couple drawbacks to this choice. While your money will earn compound interest, you're limited in the amount you can deposit into a CD. Your CD is only insured up to $250,000, so, if your wealth exceeds that limit, you won't be able to deposit it all with one bank. The second drawback is that your money isn't accessible until the CD term has expired. If you attempt an early withdrawal, you'll be subjected to penalties from the bank.
Self-Directed Precious Metals IRA
Finally, you have the option of rolling your retirement wealth over into a self-directed gold and silver IRA. This is often the most preferred option by seniors who are nearing retirement age because it offers security, flexibility, and growth. You can roll your 401k or traditional IRA funds over into your self-directed IRA and begin buying precious metals immediately. When you reach retirement age and want to start taking distributions, your precious metals IRA company will buy your gold and silver back at rates comparable to the market value at that time.
Why Seniors Should Convert More Savings to Gold and Silver
There are several different reasons that older adults should buy more gold and silver with their retirement wealth. The best way to get started is to roll over savings from a 401k or traditional IRA since this can help you avoid the contribution limits outlined by the IRS. Once you roll over your funds, you can also contribute to your self-directed precious metals IRA just as you would contribute to any other retirement account.
Guard Against Market Volatility
If you have worked with a financial advisor, they have probably advised you to diversify your investments. This is common advice designed to help investors prevent devastating financial losses. However, a downturn of the market will affect paper investments, such as stocks and mutual funds, across the board. Even if you have invested in multiple industries, all of those paper investments may be at risk.
If you have some of your retirement wealth invested in a self-directed precious metals IRA, those funds will be protected from that type of loss. In most cases, gold and silver values increase when stocks and funds lose value. This is partly because investors will want to convert their money into precious metals during an economic crisis. As demand for gold and silver increases, the value of those metals will also rise.
Gold and Silver Are Easily Liquidated
When you reach retirement age, you'll be ready to take disbursements from your savings. If you have invested in other types of physical assets, such as real estate, you'll find that liquidating these physical assets takes time. You might spend months looking for buyers who are willing to pay the fair market price for your assets. In the meantime, you might have to rely solely on your Social Security disbursements.
The story is different when it comes to liquidating gold and silver. Your precious metals IRA company will buy back your bullion and coins at a fair rate. Since they already have the infrastructure in place to process this type of transaction, liquidating your gold and silver will take very little time. This can be an invaluable service when you're relying on your retirement savings for your livelihood.
Inflation Will Become Your Friend
We experience inflation gradually over time, driving up the costs of everything as our currency loses value over time. Additionally, sudden changes to political, social, or economic factors can sharply increase the rate of inflation. Whether inflation is gradual or sudden, it causes rising prices that make it more difficult to buy almost anything.
If you own gold or silver, the weakening of our paper currency will have less of an effect on you. This is because precious metals increase in value alongside inflation. Each bar of gold or silver coin you own will be worth more in the future. This increase in value won't require any action on your part. Leaving it in your vault in an IRS-approved depository is all that's required to grow your wealth organically.
The 3 Most Reliable Gold IRA Companies
Now that you have a better understanding of how gold and silver can help you protect and grow your wealth, you might be eager to get started. While searching for a good gold IRA company can be a lengthy process, you can shorten your search by looking at the three highest-rated companies.
Each of these companies partners with self-directed IRA custodians and IRS-approved depositories. This can save time for investors who may not be familiar with precious metals investing. They will work with your IRA custodian to help you set up your account, allowing you to start buying precious metals sooner. Since the IRS prohibits retirement investors from storing precious metals in their homes, using a depository recommended by your precious metals IRA company can also save you time.
You can learn more about each individual precious metals IRA company below.
This precious metals IRA company stands out by offering the best in customer service from the moment you open your account. They continue to provide that same dedication to customer satisfaction for as long as you maintain an account with them, proving they are more concerned with building relationships than with making sales.
Their A+ rating with the Better Business Bureau and a high number of positive customer reviews attest to their quality of service. In addition to helping new customers set up their accounts and roll over their funds, Augusta Precious Metals provides a broad range of educational materials to help you learn more about investing in precious metals. They do require a minimum initial investment of $50,000, so you should be prepared to roll over that amount upon opening your account.
A company with over 10 years of experience, Goldco has become a trusted precious metals IRA company with a superb reputation among investors. They offer customer assistance in rolling over funds from 401k and other retirement accounts. Their step-by-step assistance will help you protect against the IRS' early withdrawal penalties.
They provide educational materials to help you learn about precious metals investing and how to use gold or silver to meet your retirement goals. They offer one of the best buyback programs in the market, ensuring you can get the best value from your investment. They maintain an A+ rating with the Better Business Bureau and score consistently high ratings on other consumer advocacy organizations.
Since it was founded in 2015, this family-owned business has grown to become one of the best precious metals IRA companies in the industry. Their success is largely due to their transparency when it comes to fees. Like many of the best companies, American Hartford Gold provides a library of educational resources. Their library includes live feeds that display activity in the precious metals markets.
Additionally, each customer is assigned a knowledgeable account representative who can assist them with account maintenance and establishing strategies for reaching their retirement goals. They require a minimum initial investment of $10,000. The lower initial investment amount coupled with fewer fees makes it easier for first-time investors to get started.
Early in your adult life, you can dedicate up to 15% of your retirement wealth to precious metals investing. This will leave you enough money to continue investing in paper investments. Later, as you reach your 40s and 50s, you should be much closer to reaching your retirement wealth goals. At this time, roll as much as 30% of your wealth over into your self-directed precious metals IRA. This will help you protect more of your wealth, and your precious metals will continue to increase in value. This is the safest way to grow your wealth as you prepare to retire.