3 Strategies on How to Buy Gold with Your 401k If You Can’t Buy Gold Bullion with It

Based on the 401k retirement plan, you are not allowed directly to have physical gold or gold derivatives. The good news is that you can indirectly hand over some gold with your 401k. Check the explanation about how to buy gold with your 401k below.

How to Buy Gold with Your 401k

1. Gold Mutual Funds

The gold investment gives you options. For those who can’t buy gold bullion, you can keep investing in gold by purchasing paper gold or gold mutual funds. All gold investors are allowed to have paper gold, including 401k retirement investors.

You can even find one or more potential mutual funds with your 401k plans. In this type of gold investment, you are about to hold stocks of companies that are related to the gold mining industry. The investment companies usually will manage your fund by investing it in gold exploration, mining, and production companies. Imagine that by joining this investment it means that you seem to invest your money in Barrick Gold, Newmont Corporation, Franco-Nevada, or Agnico Eagle Mines.

2. Gold ETFs

Exchanged-Traded Funds or ETFs is one of the simplest and lowest costs to invest in gold for investors with a 401k plan. How to buy gold with your 401k in the form of ETFs? You are about to invest your money in shares of a fund that holds gold bullion, such as the iShares Gold Trust ETF or IAU from Black Rock.

You can also invest your money in the Sprott Gold Miners ETF or SGDM. Investors with the help of brokers have more flexible investment options. Besides investing their money in ETFs, investors can also invest their money in individual stocks of gold industry firms.

3. Self-Directed IRA Rollover

How about if you can’t invest your money in the instruments above? The third option is by investing your 401k into a self-directed Investment Retirement Account or IRA rollover. Investors have access to any gold investment, including stocks, mutual funds, ETFs, commodity futures, and many more.

This option is suitable for people with a 401k plan who retire from their jobs. You can simply roll over the 401k money into an IRA. You can also use an in-service withdrawal if your 401k plan is with a current employer.

This strategy allows you to get your 401k funds before retirement or other events. You have to re-invest the funds in an IRA or alternate 401k plan within 60 days, otherwise, you have to pay a tax penalty. Traditional IRAs don’t allow you to invest in physical gold. If it is so, you can only put your money directly in gold stocks or funds. It is okay if you are still looking for a physical gold investment for your portfolio. All you have to do is invest your money in self-directed IRAs.

So, you don’t need to worry even if you have a 401k plan. You can still invest your money in gold. Choose one of the tricks above to invest some amount of money in gold. It is how to buy gold with your 401k safely with good returns in a few years.