Individual Retirement Accounts, more commonly known as IRAs, are savings plans that come along with lots of restrictive steps. The main advantage of having an IRA is that you can defer paying your taxes on your earnings and growth of your savings until the time when you actually withdraw the money However, if you do touch these investments before your turn 59.5 years old then you will end up paying a stiff penalty as stated by the tax laws. There are different types of IRAs, each with their own tax implications and eligibility requirements for investments and returns. In a traditional IRA you need to begin withdrawing from your account commencing the year you turn 71.
An alternative is a Roth IRA which provides tax-free savings and distributions. What distinguishes a Roth IRA from a traditional IRA is that you don’t get a deduction for your contributions. Your savings grow inside of the IRA without needing to pay any taxes on the earnings and growth. Distributions from a Roth IRA are completely tax-free, as long as you meet certain conditions. You can contribute to a Roth IRA even if you are covered by a retirement plan at work. Having saving this, the best option for you to save up for post retirement day is that you invest in gold.
Storing your retirement savings in cash is not advisable as the dollar value is prone to depreciation equal to the value of cash saved in a savings account. The result is that you end up withdrawing exactly what you saved after adjustments are on the amount.
Stock investments and securities are good options of investment but the risk involved is high. For one, the stock may crash, the fluctuations of recession and depression will have a negative impact on your investment savings. Even though mutual funds, stocks and bond investments yield good returns, it can never compare to an investment in gold.
Currency is a legal tender and the government may depreciate its value as per the country’s economic standing but the value of gold remains untouched. Governments will fail and cease to exist, thus rendering your cash savings as useless. Gold is accepted globally and this is why you should invest in the metal.
Gold price is high and will continue to increase with the race between Asian countries to accumulate the metal. Individuals are not far behind when it comes to savings in terms of gold. Gold backed IRA investment carries a tax benefit. When you liquidate your assets, you will pay a lower rate on the profit earned as the metal is a capital investment. A lower income tax will be applied to you than the normal rate.
Help on the way
Retirement investment is essential and necessary. However, before going ahead it is advisable to seek professional help. Financial consultants and experts are your resource to help you save up in the right investments that will yield guaranteed results.