Want to Know the Fees in a Precious Metals IRA?
Would you like to diversify your retirement portfolio? If so, investing in a precious metals IRA is undoubtedly the best choice. Most importantly, with this investment, you can diversify your portfolio with physical assets like palladium, platinum, silver, and gold. These accounts indeed offer protection against market volatility and inflation. However, you should be interested in understanding the fees involved. Particularly, this is important if you are planning your long-term investment strategy or comparing providers.
You might be aware that traditional IRAs hold mutual funds or stocks. On the other hand, a precious metals IRA is known for its physical nature. So, this investment attracts particular fees. You can visit this site to gain more insights into the fees involved. However, to help you plan your finances, here is a breakdown of the three primary cost categories. They are setup, storage, and custodial fees.
Setup Fees
The first cost you will encounter when you open a precious metals IRA Account is the setup fees. This is a one-time charge for establishing your self-directed IRA via an IRS-approved custodian. The typical cost ranges from 50 to 250 US Dollars. This fee covers:
- Initial consultations and compliance checks
- Account creation
- Paperwork processing
The thing to remember here is that some companies waive the setup fee as part of their promotional offer. This is offered particularly for larger investments. So, before you sign up with a company, it is better to enquire about any discounts.
Storage Fees
In an IRA, you cannot hold the silver or gold in your home. The reason is that IRS Regulations state that they should be held by an approved depository. However, these third-party storage services charge an annual fee. This fee differs based on the value or the weight of the metals you store with them. When talking about the storage, you can choose one of the following two options:
- Segregated Storage: When you choose this kind of storage, your metals will be stored separately from those of other investors.
- Non-Segregated or Commingled Storage: Yes, you have guessed it right. When you choose this option, your metals will be stored with the metals of the same category as those stored by other investors.
The typical storage cost ranges between 150 and 300 US Dollars per year for segregated storage. When you opt for non-segregated storage, the storage fee will be between $100 and $200 per year.
Here, you should remember that segregated storage offers quicker retrieval and transparency, even though it costs more. Select one based on your comfort level and investment value.
Custodial Fees
You should choose an IRA Custodian to administer your precious metals IRA. This custodian will handle the transaction processing, account maintenance, and IRS compliance and reporting on your behalf. The custodial fee will range between US$75 and US$300 per year.
Some custodians charge a flat fee per year. However, others use a sliding scale based on the total value of your assets. The Flat-rate fee is more cost-effective for larger accounts.
