Etrade Gold IRA Review

Etrade Gold IRA Review

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E*TRADE was among the first online brokers in the U.S. In October 2019, it joined the ever-expanding list of brokers online who moved over to "commission-free" trading on options trades, ETFs, and stocks.

E*TRADE provides many offerings from two mobile applications to downloadable/three web-based platforms, which has made it a top choice for casual traders, passive investors, and anyone in between.

The platform also includes robust features including screeners, research, and news, while remaining easy to use and intuitive.

But, investors want to know, do they offer a precious metals IRA that can hold physical gold and silver?

Keep reading to find out.

Before we get started with this review:

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E*TRADE has something for almost all investors.  Whether you happen to be one of the advanced traders or just a beginner, E*TRADE has a mobile application and platform for you.

The E*TRADE mobile app and Web Platform provide market commentary, real-time quotes, exchange-traded and stock fund screeners, along with more than adequate account management.

More active traders can use the Power E*TRADE app and platform to obtain trading ladders, chain views, customizable options, drawing tools, technical studies, and a host of features dedicated to complex strategies.

The problem is that E*TRADE does not offer IRAs that can hold physical gold and silver.  

Do not worry though because we have researched all the companies that offer precious metals IRAs and created a list of the best, safest, and most ethical companies to work with to create a safe and secure gold IRA.

Simply click on this link to read our list of the most trustworthy gold IRA companies to invest with.

Why Put Physical Gold in Your IRA?


Individual Retirement Accounts (IRA) protect your retirement as well as your family's financial security.

These special accounts allow you to set aside tax protected savings that you can use in the future.   

With these long term accounts it's important to allocate a significant portion to assets that are solid and reliable, so you have a secure and worry-free retirement. 

a couple listening to a financial advisor

You can have cash in an IRA, but that is devaluing at a rapid pace and inflation is out of control

You need an asset that's dependable, retains it's value, and even increases in value over time, and there is no better asset for this than gold. 

With the world's economy struggling through lockdowns, shortages, wars, and inflation, uncertainty has never been higher and investors are protecting themselves by placing physical gold in IRA's. 

A gold IRA investment prospers from these crisis that negatively affect most other assets. 

Risk is knowing the economic dangers and doing nothing to protect yourself and your family. 

Safety is knowing the economic dangers and taking action to protect your financial future, and this is easy to do with a gold IRA.

What Is A Gold Backed IRA?


A precious metals IRA or a gold IRA are self-directed IRAs (Individual Retirement Accounts) that have increased in popularity over the last few years, especially among people who value stability and diversity when it comes to their investment portfolios. 

This is a type of financial instrument that allows investors to include physical gold or precious metals (in the form of bars and coins), in their tax-sheltered accounts for retirement.

Precious metals are well-known for acting as a hedge when it comes to geopolitical crises and inflation and is suited ideally to offer diversification to portfolios away from paper-based assets. 

These investments are also highly suitable for long-term investors.

The main objective of just about every gold IRA investor involves the long-term preservation of their wealth. Precious metal IRAs are a stable, powerful, and safe vehicle to maintain asset growth over the long term.

To maximize the security and safety of these investments even further, all types of precious metals will be stored in an IRS-approved depository.

Once the owner of the physical gold or precious metals retires, they can easily convert the assets into cash or have their investments directly shipped to them.

It is also important to know that rolling over or transferring any existing retirement accounts will be a tax-free transaction.

Advantages of a Physical Gold IRA


gold bars on etrade website

When you decide to invest in one of these gold IRAs, your portfolio for retirement will be diversified on a "tax-deferred" basis and it will maintain tax-preferential treatment.

This will mean that rolling over or transferring a percentage of your current IRA account into precious metal or gold IRA will not result in tax penalties.

By opening a gold IRA you can benefit from annual contributions of $6,000 (when you are under the age of 50) or $7,000 (when you are over the age of 50). 

Also, it's important to know that not all precious metals are IRA eligible. The Internal Revenue Code lays out the framework in Section 408(m) for which precious metals you are allowed to hold in an IRA. 

It is essential to work with a reliable and trustworthy gold IRA firm that can assist you with avoiding tax pitfalls, navigating the regulatory requirements, and diversifying your portfolio with gold or other precious metals to give more stability to your portfolio for retirement.

Here are three of the top reasons why many financial experts recommend investing in a gold IRA:

  • Actual Portfolio Diversification

When you invest a percentage of your savings for retirement in something such as precious metals or gold it will diversify your portfolio into alternative uncorrelated assets that have a track record of protecting your money, particularly when governments, currencies, and markets start to falter.

The investment vehicles from Wall Street are all based on bonds and stocks which are all paper-based. Precious metals and physical gold offer an extra diversification layer.

  • Inflation Hedge

As time goes by, inflation will start to erode your investments. Gold offers a secure hedge against inflation, and gives your portfolio immunity against the effects relating to inflation.

  • Profit Potential

The performance of gold historically indicates that precious metals offer significant profit potential, especially over the longer run. As an example, in 2000, Gold was around $200 an ounce.

In 2017, gold finished above $1,200 an ounce, which results in a 5X ROI (return on investment). 

Gold offers wealth protection and it is backed by a lengthy history of achieving this exact purpose.

Historical data has also shown that gold has increased in value over the years, even in tough economic times, which has made it a valuable addition to all types of well-balanced retirement portfolios.

Smart investors use precious metals as insurance to hedge against inflation and deflation, evolving political chaos and economic environments, and reckless money printing.

What Exactly is a Self-Directed IRA?


Self-directed IRAs are retirement accounts that give investors more control of their financial futures. Similar to conventional 401(k)s, or IRAs, self-directed IRAs also allow you to enjoy tax benefits. 

It offers the same benefits as most of the other retirement accounts with a few important differences.

cartoon of woman looking at taxes and a calculator

These include a wider range of investment options along with more control over your retirement account and portfolio. 

With self-directed IRAs, it becomes possible to safeguard your retirement, by extending beyond just the paper-based assets and diversifying with an alternative asset such as IRS-approved precious metals or gold.

Physical Gold IRA Account Types


Similar to traditional retirement accounts, there is also a range of accounts that provide distinctive tax benefits.

These three gold IRA account types include:

Traditional Gold IRA

The traditional gold IRAs are tax-deferred savings accounts for retirement that operate like the pre-tax conventional IRAs in regards to taxes. Your gains and contributions are not taxed. In the majority of cases, your contributions will also be tax-deductible.

The IRS has set contribution limits annually of $5,500 (if you are under the age of 50), and $6.500 (if you are over the age of 50). With the pre-tax IRAs, you will be liable for tax on the distributions once you have retired.

Roth Gold IRA

The Roth gold IRAs are after-tax savings accounts for retirement that works in the same way as traditional Roth IRAs. 

While there won't be upfront tax deductions with contributions into a Roth IRA, the main benefit of this type of IRA is that you won't be liable for tax once you have retired and you have started to take distributions.

SEP Gold IRA

The SEP Gold IRAs are dedicated to self-employed individuals and business owners. This type of IRA account works in a similar way to the pre-tax conventional IRAs, where your contributions will not be taxed, but it does provide higher contribution limits.

Rather than the $5,500 limit, you will be allowed to contribute up to $53,000 or 25% of your annual income (or whichever is less).

Gold IRA Vs Gold Stocks Vs Gold ETF


You can own gold in different ways.

You can either choose to purchase physical gold and then store it in a safe or your home or anywhere else that pleases you.

Or you can purchase stocks from mining companies.

The other popular options are gold futures, gold ETFs, and gold IRAs. 

stock market chart

So How Do They Differ From Each Other? 

The gold ETFs are known as commodity funds that will trade just like stocks do. Even though these include gold-backed assets, investors will not own these physical commodities. 

Instead, they will take ownership of gold-related assets in small quantities, which provides diversity to their portfolios.

In general, these are vehicles that allow an investor to gain more exposure to a precious metal such as gold through a smaller investment position than what is achievable through futures contracts and physical investments.

However, many investors are not aware that the prices to trade ETFs to track gold might outweigh the convenience.

Gold futures are contract types that trade on exchanges. Both parties will agree that a buyer will purchase the commodity at both a "set date" and a predetermined price (in the future).

Investors can fund the commodity without the need to pay upfront in full, which gives a bit more flexibility in how and when the deals will be executed.

There is also the option to purchase stocks from mining companies. This option also doesn't mean owning physical gold, but rather shares in the gold-mining company.

There is also the option to purchase physical gold or any other precious metal and keep it until you decide to liquidate the asset.

An IRA or individual retirement account is recommended for all types of investors. One of the main reasons has to do with the outstanding tax benefits that these accounts provide. 

Contributions on conventional IRAs are usually tax-deductible, and the earnings in the IRA can grow tax-free in the account until you start withdrawing the funds once you have retired. 

The gold IRAs are IRAs that hold physical gold as opposed to paper-backed assets. 

For example, regular IRAs may hold mutual funds, bonds, or stocks, which are all investments that are paper-traded. With gold IRAs, the investment will be tangible, which means it is easy to liquify.

This will also mean that if the dollar loses all its value and the economy tanks, your IRA will still hold value due to the value of precious metals globally.

How to Choose the Best Investment


Deciding where to save your money over the years is not an easy feat. Every investor is interested in something that will grow in value and something stable.

While any type of gold goes into this particular category, purchasing gold certificates, gold coins, or bars, does not provide the same type of tax breaks that a gold IRA does. 

man looking at a clipboard

It may sound like a good idea to buy a gold ETF, but you should first establish a solid gold IRA. This will offer the benefits linked to tangible gold investments, and you will enjoy tax benefits linked to these types of retirement accounts.

E*TRADE's Tradable Securities


E*TRADE provides many investment options, from bonds, ETFs, stocks, and over 4,300 no-transaction-fee mutual funds, to advanced and futures options strategies.

Educational Support and Resources


The educational support and resource options that E*TRADE provides are among the very best. There are webinars available for viewing on technical analyses and diversification and topics that are more complex such as options trading.

There are also investing courses online from Morningstar that include a variety of topics. This includes a section on thematic investing that covers the ways to invest in the companies that match up to your values.

Etrade Education Center


For investors that are just starting, E*TRADE provides classes, videos, articles, and financial topics in a library.

E*TRADE's Knowledge Center is focused on beginner investors, tax planning, and long-term planning along with advanced topics such as futures and options.

E*TRADE facilitates a complete calendar that contains events, which includes live and free in-person online webinars and events, which was created to assist investors in honing their skills and to help them feel more assured when it comes to the decisions that they make for their investments. 

Investors have complete access to a library that covers different areas of interest and financial topics. There is also access to various platform demos which help investors to learn the right way to use the platforms and tools on E*TRADE.

The Knowledge Center is a resource for free to any site visitor, whether they have signed up for an E*TRADE account or not.

Who is E*TRADE Best For?


As one of the pioneers of the online brokerage sector, E*TRADE has secured a position as among the best online brokers when it comes to trading options. It is a well-rounded and solid choice for all types of investors.

E*TRADE is actively working on attracting active traders using two high-quality trading platforms, many investment selections, a full-featured mobile application, and options-trading tools.

The Power E*TRADE platform also contains easy-to-use and intuitive tools for options, futures trading, and stocks. If you have a passion for trading and tracking the markets, this is the ideal platform to try.

Pros

  • Large investment selection
  • Easy-to-use tools
  • Access to an abundance of research
  • Commission-free options, ETF trades, and stocks

Cons

  • Some people find the site a bit complex to navigate
  • Does not offer physical gold IRAs

Conclusion

E*TRADE is a well-established online broker.

This firm's $0 commissions and robust trading platform is appealing to many active traders, and the investors that are just starting benefit from the extensive library that contains a plethora of educational resources.

E*TRADE is a reputable company but we do not recommend them.  They are not the best option for conservative investors looking to protect their savings with a physical gold IRA.

There are much better options that we have written about extensively on this website.

You can get a Free Gold Investors Guide from our top gold and precious metals company recommendation by clicking the link above or you can read our article of the top companies we reviewed this year:

>> CLICK HERE to read our list of the top gold IRA companies. <<

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