Top 10 Gold IRA Scams Investors Should Avoid Getting Burned

Individual Retirement Accounts (IRAs), are a popular retirement account for more than 62 millions Americans.

Many investors are now turning to gold and gold IRAs for safer investments as the stock market becomes more volatile. Experts are worried about a possible downturn.

Scammers are everywhere there is money to make, and gold IRAs don't seem to be any exception. There are ways to avoid scams with gold IRAs and protect your retirement.

Check out these most common gold scams

  1. Home storage gold IRA
  2. Rare coins
  3. Collectable/Numismatic coins
  4. Counterfeit coins
  5. Non-delivery/Ponzi Schemes
  6. Pushy salespeople
  7. False contracts
  8. Shaved coins
  9. Bait and Switch Scam
  10. Hidden fees

What is a Gold IRA and how can it help you?

You cannot protect your gold for this type retirement fund, according to IRS regulations. An IRA custodian is required.

No company can protect IRAs free of charge, so they will have to charge maintenance fees for sourcing or managing your gold.

Some companies make money by ripping off investors who don't have experience with precious metals.

Common Gold IRA Scams

Many investment scams are designed to siphon off money from unsuspecting investors. This list does not include all of the scams that are common.

If you are unsure whether a company has credibility, consult a financial advisor.

Home Storage Gold IRA

The IRS requires precious metals to be stored in approved depositories for an IRA. A company that advertises "home storage" for a gold IRA is a fraud.

Even if the company promotes a "free safe" and "additional coin" that you can take home (but not your entire investment), it should alarm you.

Home storage companies are intentionally misleading customers.

Rare Coins

Rare coins should not be considered IRA investments. You should concentrate on the spot gold price when you buy or sell gold, and not on rare coins.

It is important to know what types of bullion and coins are allowed in a precious-metals IRA. Look for another IRA dealer if a precious metals dealer tries to sell you coins that are not approved by IRS.

Only a reputable company will offer this type of investment for an IRA in precious metals.

  • Gold: All gold used in your IRA must contain 99.5% purity, except for Gold Eagle coins. This is something that a reputable precious metals dealer should know.
  • Silver:Silver bullion and coins must be 99.9% pure in order to qualify for an IRA.
  • PalladiumPalladium must have at least 99.5% purity
  • Platinum: platinum must be at minimum 99.5% pure in order to be eligible.

It is a sign that a company may be trying to get you to buy rare coins, rather than bullion or common-gold coins.

They likely receive a commission for rare coin sales. Their interest in you is short-term.

Collectable/Numismatic Coins

Investors can add gold and other precious metals into their investment portfolios with Gold IRAs. All gold and precious metals that you invest in must reflect the intrinsic value of those metals, not their collectible values.

Any IRA custodian selling collectible coins or special edition coins to you is at best intentionally misleading. The IRS doesn't support collectible coins being legitimate investments for gold IRAs.

Counterfeit Coins

Fake coins are a common con. It can be hard to avoid these scams because counterfeiters cover less-valuable bullion and coins in gold to make them look legitimate.

A scale is a good option if you want to inspect the gold you are interested in buying in person. This is the best method to establish legitimacy.

If you don't have the luxury to see the gold ahead of time, you will need another method.

If you are purchasing directly from a depository, review your IRA company and compare ratings with the Better Business Bureau.

Non-Delivery/Ponzi Schemes

Ponzi schemes are frauds where a portfolio manager or dealer promises future investors that they will use funds to repay past investors.

This could be used to give your money to a company for gold purchases. It will instead spend your money on an unrelated purchase or buy gold for another investor.

If the company succeeds in convincing another potential investor to join its scheme, it will be able give you your gold.

It can be difficult to tell if you are dealing with a Ponzi Scheme. It is best to examine the shipping times for your goods to determine if you are dealing with a Ponzi Scheme.

It is possible that the company isn't using its funds properly if shipments are delayed for several months.

Pushy Salespeople

Some salespeople might try to convince you to invest urgently, warning that you may miss an opportunity if this happens. This is almost always a sign that the scammer is trying to con you.

Avoid pushy sales pitches. Be clear about your investment goals and follow them.

These sales tactics can be a red flag and signify that the salesperson is pushing too hard.

  • Guarantees of high returns and quick returns:Factoring in gold into retirement planning is a way to hedge against inflation while still generating steady, slow returns. You should not invest in gold for a high return, and be skeptical of any sales pitches that claim otherwise.
  • Pushing for quick decision: A reputable gold IRA company understands that retirement decisions shouldn't be taken in haste.
  • Searching for collectibles or coins: Gold and precious metals are commodities. Their value is determined by their metals, not their demand.

False Contracts

Make sure you read every contract before you sign it. It doesn't matter if your goal is to buy a house or open an IRA with precious metals.

Do not sign a contract if you aren't sure if it is fair or if you don't understand the terms. For assistance, contact a contract expert.

The salesperson might pressure you to sign a contract as soon as they see it. This is a huge red flag.

You should have enough time to read and review the contract before you sign it.

Shaved Coins

Shaved coins is one of the most common gold frauds. This scam involves dealers cutting off tiny amounts of gold that are barely visible from every piece of gold they sell.

This is a tricky scam to avoid as your gold will likely go straight to a bank after you have completed the purchase. Many investors don't even see their gold.

This means that you won't be able to inspect your investment for signs of manipulation.

You can protect your investment and yourself by choosing a trusted dealer. Avoid new companies and companies with bad reviews.

Bait and Switch Scam

Companies that offer unlimited gold or other unimaginable bonuses should be avoided. It is possible that it sounds too good to be true.

Many companies will offer you a great deal such as buy-backs at inflated prices or bullion coins. But then they'll pull the plug and charge you.

Ask for additional time if you are unsure about the legality or reliability of an offer, or the legitimacy and legitimacy of a promotion.

Do not agree to sign a contract if a salesperson presses you more and insists that the offer "only happens today". This is almost always a bait-and-switch.

Hidden Fees

A company that asks you to invest in precious metals must clearly explain the fees to you upfront.

It is a warning sign that a salesperson mentions higher or different fees during a conversation.

These are the most popular fees for gold IRAs.

  • One-time account opening fee: Most companies offering gold IRAs charge a one time fee. For significant initial investments, this fee may be waived.
  • Account management Fee:IRA dealers may charge you an account management cost. This fee usually ranges between $100 and $300.
  • Storage Fee:In order to keep your gold safe and sound, you'll need to pay an IRS-approved storage fee.
  • Spot Price Fee: You may be charged a little more than the market price of gold for an IRA investment. This is normal as you are not purchasing directly from a precious metals broker.

A company should however declare markups in the beginning of the investment process, and not surprise you later.

You may be dealing with a fraudster if you are charged large, additional fees beyond those mentioned above.

Five Tips to Avoid the Gold IRA Scams

1. Make sure you do your research. You should check several reliable sources for information about a company. You should avoid a company with a lot of negative reviews.

2. Third-party review sites are a good place to start: Positive reviews and testimonials tend to be more common on a company's website, but negative reviews will likely be filtered out. Trustpilot is a trusted third-party review site that will give you a balanced view.

3. Ask for references from customers. Reputable companies that offer gold IRAs will not hesitate to put you in touch with satisfied customers, particularly if you are considering large investments.

4. The Better Business Bureau: Many gold IRA providers have A+ ratings with the Better Business Bureau. You should not choose an option that has less than the best.

5. Talk to your financial advisor. Your financial advisor probably has more experience in identifying and recognizing scams than you. Don't hesitate to ask them about certain companies.


  • This is a sign that a salesperson may be trying to get you to sign or make a purchase quicker than you are comfortable with.
  • Companies that promise high returns and claim gold is low-risk investments should be avoided. It is possible to lose your money if you invest in gold.
  • Do not choose a company that does not offer the opportunity to meet with financial advisors and contract lawyers.
  • Look for a company that has a lot of positive reviews, and who isn't interested in its success.
  • To protect others investors, report any scams that you may have fallen for.

Augusta Precious Metals

Augusta assists retirement savers by helping them diversify their savings with gold or silver. Get their free guide to gold IRAs.

You earn a commission when you invest.

Frequently Asked Questions

Can I have physical gold in my IRA

Not just paper money or coins, gold is money. It's an asset that people have used for thousands of years as a store of value, a way to keep wealth safe from inflation and economic uncertainty. Gold is a part of a diversified portfolio that investors can use to protect their wealth from financial uncertainty.

Many Americans now invest in precious metals. Although owning gold does not guarantee that you will make money investing in it, there are many reasons to consider adding gold into your retirement portfolio.

Another reason is that gold has historically outperformed other assets in financial panic periods. Between August 2011 to early 2013, gold prices rose close to 100 percent while the S&P 500 fell 21 per cent. During those turbulent market conditions, gold was among the few assets that outperformed stocks.

Another benefit to investing in gold? It has virtually zero counterparty exposure. If your stock portfolio goes down, you still own your shares. If you have gold, it will still be worth your shares even if the company in which you invested defaults on its debt.

Finally, gold offers liquidity. This means that you can sell gold anytime, regardless of whether or not another buyer is available. Gold is liquid and therefore it makes sense to purchase small amounts. This allows you to profit from short-term fluctuations on the gold market.

How do I open a Precious Metal IRA

First, decide if an Individual Retirement Account is right for you. To open the account, complete Form 8606. You will then need to complete Form 5204 in order to determine which type IRA you are eligible. This form must be submitted within 60 days of the account opening. Once this has been completed, you can begin investing. You can also contribute directly to your paycheck via payroll deduction.

To get a Roth IRA, complete Form 8903. Otherwise, the process will look identical to an existing IRA.

To be eligible to have a precious metals IRA you must meet certain criteria. The IRS says you must be 18 years old and have earned income. You can't earn more than $110,000 per annum ($220,000 in married filing jointly) for any given tax year. And, you have to make contributions regularly. These rules are applicable whether you contribute through your employer or directly from the paychecks.

You can use a precious metals IRA to invest in gold, silver, palladium, platinum, rhodium, or even platinum. But, you'll only be able to purchase physical bullion. This means you won’t be able to trade stocks and bonds.

To invest directly in precious metals companies, you can also use precious metals IRA. This option may be offered by some IRA providers.

There are two major drawbacks to investing via an IRA in precious metals. First, they aren't as liquid than stocks and bonds. It is therefore harder to sell them when required. Second, they don’t produce dividends like stocks or bonds. Also, they don't generate dividends like stocks and bonds. You will eventually lose money rather than make it.

How much should precious metals make up your portfolio?

To answer this question, we must first understand what precious metals are. Precious metals have elements with an extremely high worth relative to other commodity. This makes them extremely valuable for trading and investing. Gold is by far the most common precious metal traded today.

There are also many other precious metals such as platinum and silver. While gold's price fluctuates during economic turmoil, it tends to remain relatively stable. It is also not affected by inflation and depression.

The general trend is for precious metals to increase in price with the overall market. However, they may not always move in synchrony with each other. For example, when the economy is doing poorly, the price of gold typically rises while the prices of other precious metals tend to fall. Investors are more likely to expect lower interest rates making bonds less attractive investments.

However, when an economy is strong, the reverse effect occurs. Investors choose safe assets such Treasury Bonds over precious metals. Since these are scarce, they become more expensive and decrease in value.

To maximize your profits when investing in precious metals, diversify across different precious metals. Additionally, since the prices of precious metals tend to rise and fall together, it's best to invest in several different types of precious metals rather than just focusing on one type.

How do you withdraw from an IRA that holds precious metals?

First, determine if you would like to withdraw money directly from an IRA. Then make sure you have enough cash to cover any fees or penalties that may come with withdrawing funds from your retirement plan.

You should open a taxable brokerage account if you're willing to pay a penalty if you withdraw early. If you decide to go with this option, you will need to take into account the taxes due on the amount you withdraw.

Next, figure out how much money will be taken out of your IRA. This calculation is affected by many factors, such as the age at which you withdraw the money, the amount of time the account has been owned, and whether your plans to continue contributing to your retirement fund.

Once you know how much of your total savings to convert to cash, it's time to choose the type of IRA that you want. Traditional IRAs permit you to withdraw your funds tax-free once you turn 59 1/2. Roth IRAs have income taxes upfront, but you can access the earnings later on without paying additional taxes.

Once these calculations have been completed you will need to open an account with a brokerage. Brokers often offer promotional offers and signup bonuses to encourage people into opening accounts. To avoid unnecessary fees, however, try opening an account using a debit card rather than a credit card.

You will need a safe place to store your coins when you are ready to withdraw from your precious metal IRA. Some storage areas will accept bullion, while others require you to purchase individual coins. You'll have to weigh the pros of each option before you make a decision.

Bullion bars are easier to store than individual coins. However, each coin will need to be counted individually. On the flip side, storing individual coins allows you to easily track their value.

Some people prefer to keep coins safe in a vault. Others prefer to place them in safe deposit boxes. No matter what method you use, it is important to keep your bullion safe so that you can reap its benefits for many more years.


  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (
  • This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (
  • You can only purchase gold bars at least 99.5% purity. (
  • Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (
  • Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (

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Investing in gold or stocks

Investing in gold as an investment vehicle might seem like a very risky proposition these days. This is because many people believe that gold investment is no longer profitable. This belief is based on the fact that gold prices are being driven down by global economic conditions. They think that they would lose money if they invested in gold. In reality, however there are still many significant benefits to gold investing. Below are some of them.

Gold is one of the oldest forms of currency known to man. There are records of its use going back thousands of years. People around the world have used it as a store of value. It's still used by countries like South Africa as a method of payment.

Consider the price per gram when you decide whether you should invest in or not. It is important to determine the price per gram you are willing and able to pay for gold bullion. You can always ask a local jeweler what the current market rate is if you don't have it.

It is also worth noting that although gold prices have declined recently, the cost of producing gold has increased. Although gold's price has fallen, its production costs have not.

Another thing to remember when thinking about whether or not you should buy gold is the amount of gold you plan on purchasing. If you plan to buy enough gold to cover your wedding rings then it is probably a good idea to wait before buying any more. However, if you are planning on doing so for long-term investments, then it is worth considering. It is possible to make a profit by selling your gold at higher prices than when you purchased it.

We hope our article has given you a better understanding of gold as an investment tool. It is important to research all options before you make any decision. Only after you have done this can you make an informed choice.

By: Donny Gamble
Title: Top 10 Gold IRA Scams Investors Should Avoid Getting Burned
Sourced From:
Published Date: Sat, 07 Jan 2023 13:29:45 +0000

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