IS PALLADIUM A GOOD INVESTMENT FOR YOUR IRA?
It became an Internal Revenue Service (IRS) approved investment asset after the United States Congress passed the Taxpayer Relief Act in 1997. Since then, palladium coins and bars that meet minimal purity criteria have been permitted for self-directed commodities IRAs.
Because of global economic shocks, Washington D.C. shenanigans, and the Federal Reserve’s never-ending printing press, retirement planning is more challenging than ever. Palladium might be the secret ingredient you’ve been looking for to add a terrific investment to your IRA – one that can protect your nest egg from future crises!
WHAT EXACTLY IS PALLADIUM?
Palladium is a silvery-white metal that resembles platinum in both appearance and chemistry. In the Platinum Group Metals, it is a minor dense metal. This group of metals is notable for its usage in industrial manufacturing, which makes them extremely expensive.
Palladium has a wide range of industrial applications, including:
• automotive catalytic converters
• aircraft spark plugs
• ceramic capacitors in electronics
• hydrogen storage
Palladium is found in many jewels and timepieces. Palladium and gold alloys are used to make some of the world’s highest-quality “white gold” jewelry.
Palladium is one of only four metals with a “currency code” assigned by the International Organization for Standardization. The IRS allows the other three metals — gold, silver, and platinum – to be held in an IRA.
OTHER PRECIOUS METALS VS. PALLADIUM
Palladium is the least well-known of the IRS-approved metals for investment. As a result, individuals wanting to add precious metals to an IRA sometimes neglect it.
Like the other investment-grade valuable stones, Palladium has inherent value, which means it is a real asset with demand outside of investing. This offers a significant edge over assets like stocks, bonds, and currencies, whose value might fall to zero.
According to the CRB Commodity Yearbook, Palladium is one of the world’s rarest metals, with “all the palladium produced to date fitting in a regular looking living room.” Palladium is presently produced by a small number of mines in South Africa (40%) and Russia (almost 90%). (45 percent ).
Palladium, by comparison, is 15 times rarer than platinum and 30 times rarer than gold.
Palladium is also less costly than gold or platinum to purchase. This may make it one of the best gold IRA choices for those looking for a less expensive way to set up a precious metals IRA.
Palladium demand is expected to increase during the next decade. Last year, the car sector accounted for more than 60% of the need for metal, and both China and India are anticipated to add a large number of vehicles in the future years. Indeed, according to the Wall Street Journal, worldwide vehicle manufacturing may increase until 2018 and beyond.
Palladium bullion has a far lower circulation than gold or silver bullion, making it less liquid. Palladium prices can also be more unpredictable than other metals since production is primarily limited to South Africa and Russia.
Recent unrest in Eastern Europe has put Russian palladium supplies in jeopardy. When you combine it with the possibility of increasing global demand for vehicles, you have a formula for higher palladium prices in the future.
PALLADIUM IN YOUR IRA: WHAT YOU NEED TO KNOW
Palladium can be indirectly purchased through exchange-traded funds (ETFs) or mining company shares, among other options. Indirect investments, on the other hand, do not have the same inherent worth as palladium bullion. Physical Palladium in an IRA is a far more substantial hedge against a depreciating currency or a stock market decline.
Palladium coins and bars having a purity of at least 0.9995 may be kept in an IRA account under the Taxpayer Relief Act. Every bullion must be verified by an “assayer,” usually NYMEX or COMEX for purity testing.
There are now just a handful of palladium coins or bars approved for inclusion in an IRA. The Canadian Maple Leaf coin and the Credit Suisse Palladium bar are the most well-known qualifying palladium bullion. Both are known for their high quality all over the world.
A $5,000 initial bullion deposit is required for all precious metals IRAs. All future bullion deposits into the IRA are at least $1,000 in value. According to the IRS, the bullion must also be held by a qualified “depository” to ensure its safety.