Can I Buy Gold With My TSP?
Most investment gurus agree that precious metals have an essential place in any retirement portfolio – but what if you could buy these physical assets with your TSP instead?
The Thrift Savings Plan (TSP) does not offer many opportunities to invest in physical gold directly; one option would be transferring TSP funds into an IRA custodied by a precious metals company.
How to Buy Gold with Your TSP
Thrift Savings Plans (TSPs) can be an ideal savings vehicle for federal employees, with tax advantages and matching contributions providing great accumulation opportunities. Unfortunately, however, TSP accounts don’t provide enough investment options that help stave off high inflation and preserve wealth over 20-30 year retirement horizons.
Although your TSP account can hold some gold-related assets such as precious metal futures and exchange-traded funds, physical precious metals cannot be directly invested in. To purchase physical gold coins and bars directly, a separate taxable investment account or self-directed IRA such as Augusta Precious Metals’ is needed – they specialize in helping clients roll over TSP, 401(k), 403(b), or 457(b) accounts into gold IRAs with excellent customer support and expertise that has earned rave reviews from consumers alike! For more information click here or here
Taxes on Gold
Gold can be an asset worth adding to any investment portfolio as its value holds steady during economic turmoil and acts as a hedge against inflation. Investors should carefully consider its tax treatment before making this investment decision.
Investors investing in physical gold may be subject to numerous taxes when making their purchase, including dealer markups and storage fees from dealers and management fees and trading costs from funds. It is wise for these investors to consult a tax professional in order to ensure they do not overpay in taxes.
Sometimes it may make more sense to roll over TSP assets into a self-directed gold IRA than transfer them directly to a metals company. A self-directed IRA firm can assist you in allocating part of your retirement funds towards precious metals investments before managing trustee-to-trustee transfers themselves and charging an account management fee that’s often less expensive than that charged by physical investments companies.
Your Thrift Savings Plan does not allow you to purchase physical gold bullion directly; however, you may invest indirectly by buying shares of gold mining companies or ETFs that hold physical gold (known as “paper gold”). Unfortunately these investments do not directly correlate to gold’s price, which means their values could vary and provide no income or dividends like stocks and bond funds which generate dividends.
Gold IRAs may charge additional fees when buying and selling precious metals, which could reduce your return. Be sure to research these companies thoroughly and compare their costs with those charged by other IRA custodians before deciding where you would like to roll over your account.
Most investment experts advise including gold in your retirement portfolio, but do not make it the centerpiece of your finances. Instead, focus on earning additional income to reach your retirement goals.
Pre-retirees who watched their paper assets fall in value within their TSP in 2007 quickly realized that precious metals provide the ideal way to hedge against financial collapse.
Unfortunately, while being an excellent retirement plan for federal employees and military members, the Thrift Savings Plan offers only limited investment options when it comes to physical gold and silver investing. Your only way of investing through your TSP in physical gold or silver would be through rolling over into an IRA account.
Rollover, also known as trustee-to-trustee transfer, involves moving funds directly from your TSP account into one or more IRAs within 60 days or else they will be considered withdrawals by the IRS and subject to taxation.
SPDR Gold Trust ETF (GLD), with an expense ratio of only 0.40%, provides easy, cost-effective, and liquid exposure to gold in your TSP account. While physical bullion may be convenient in times of disaster or economic collapse, self-directed IRA custodians such as Birch Gold Group and Augusta Precious Metals provide self-directed gold IRA accounts as an insurance plan against zombies or catastrophic collapse.
Categorised in: Blog