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Even after you retire, you should continue to invest your savings and look for ways to protect your wealth. After you retire, you might find that you need more money than you anticipated, or your medical care may drain your savings faster as you face the decline of your physical or mental health. You'll be better able to cope with any of these situations if you continue to invest your retirement savings as you begin taking distributions.
After you do reach retirement age and especially after you reach age 72, how you handle your savings will change. The IRS regulates how retirees can access and use their money, so it's necessary to learn about these rules. Knowing more about what you can legally do with your retirement money will help you to continue growing it as you reach 90 years old and beyond. If you live a longer life, you'll have the financial resources to support yourself throughout those later years.
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Assess Your Financial Needs
As you reach 90, it may be time to take a new assessment of your financial needs. You might find that you have needed more income than you planned when you first entered your retirement, and that may have led to a faster drain on your resources. It's also common for people to miscalculate their future medical needs as they reach retirement age. You might need in-home care, treatment for a chronic condition, or extended hospitalization for a serious illness. All of these care needs will affect your retirement savings and how long those resources will last.
As you assess your financial needs more accurately based on your retirement experience, your investing goals should also change. You might find that you still need a more aggressive investing strategy to help you compensate for a higher than expected cost of living. Rather than moving everything into a high interest money market account, you'll need to continue pursuing diverse investing patterns. Your goal will be to preserve a majority of your wealth as you also continue investing a percentage of your savings in high-risk investments that have the potential to generate higher returns.
Consider the Advantages of Buying Gold
As you reach the later years of your retirement, preserving your savings for longer will become just as important as growing more wealth. Investing in gold can help you satisfy both of those objectives at the same time. However, you won't enjoy the full benefits that gold offers if you're indirectly investing in precious metals through ETFs or mutual funds. To experience the full range of gold's advantages, you'll need to own your own bars and coins in a self-directed IRA.
Gold is a Physical Asset
Every type of investment comes with its own set of risks, but those risks are minimized when it comes to owning gold. Since it is a physical asset, the gold you own will never be diminished or lost through a downturn in the market. Even though your gold bar may be worth less during a brief period of loss, it will still weigh the same and contain the same level of purity. This means that gold bar will regain its value when the market takes a new upward turn.
Gold Performs in Opposition to Other Investments
When your investments in stocks or mutual funds experience losses, any gold that you own will perform better. That's because periods of loss cause investors to turn to the security and durability that gold offers. The increased demand for precious metals will drive up the worth of gold. In this way, owning gold with some of your retirement savings will help you protect that percentage of your wealth during economic downturns.
Gold Increases Its Value
Inflation devalues most investments as the worth of paper currency loses strength. The opposite is true for gold. Since gold bars and coins are physical assets, their worth increases through periods of inflation. Even the gradual inflation that occurs over a longer period of time will positively impact the value of gold. In practical terms, this means merely holding onto your gold for longer will increase its value. Storing your gold in a vault for just five years can result in a substantial increase in the value of your holdings.
Gold is Easily Liquidated
As you go through your retirement years, you will create a schedule of disbursements that you'll use as your income. Liquidating paper investments, such as stocks, can involve a lengthy and complex process. Alternatively, liquidating gold is as simple and quick as finding an investor to buy your gold. Your gold IRA company may even help you liquidate your gold faster. This makes it easier to access your retirement savings when you're facing an economic pinch.
Leave Something Behind
You can transfer ownership of your gold, and you may not even have to hire an attorney to set up that process. Your gold IRA company can help you name a beneficiary to ensure the ownership of your remaining gold will pass on to the individual of your choice. Since gold is durable and long-lasting, the bars and coins you leave to your loved ones will continue to grow in value for as long as your beneficiaries hold onto them.
Know the Rollover Rules for Retirees
Your ability to do a rollover from a 401k or traditional IRA to a self-directed gold IRA will change after you reach 72 years of age. If you initiate an invalid rollover, the IRS may charge you penalties just as those you would face in missing the 60-day rollover deadline. Primarily, avoiding invalid rollovers involves knowing when to take mandatory distributions and when to start a new rollover.
Take Required Minimum Distributions
Once you reach 72, the IRS requires you to start taking a minimum annual distribution by December 31st of each year. If you schedule your distribution for late December, you won't have enough time to initiate a rollover from one retirement account to another. An indirect rollover, which involves receiving a check from one IRA account and depositing it in another IRA account, will be viewed as a distribution. Even if you meet the 60-day time limit, the withdrawal will be viewed as your mandatory distribution. That's because the IRS views the first withdrawal in each year as the minimum annual distribution. Taking your distribution earlier in the year will give you the time you need to initiate an annual rollover into your self-directed gold IRA.
Know How Much to Include in Your Rollovers
Another restriction that's placed on retirement accounts for seniors 72 and older is that they can only complete one rollover per calendar year. If you think you'll want to add more money to your self-directed gold IRA at a later time, it's better to roll all of the funds over once. Otherwise, you will have to wait another 12 months before you can initiate a new rollover. There are some exceptions when rolling over into a qualifying retirement account, such as a Roth IRA, but, in most cases, more than one rollover in a year is prohibited.
Who Can Help You Start a Gold IRA?
If you don’t already have a self-directed IRA, you’ll have to set up your account before initiating a rollover. While there are many gold IRA companies open in the United States, each one offers a different quality of service. Choosing a company that has been rated high by previous customers for their dedication to service will help you get started. The following three companies offer the highest rated service in the precious metals investing market. You can read reviews for these companies on most consumer advocacy websites.
Augusta Precious Metals (WINNER)
Among the top three, Augusta Precious Metals is often rated first due to their dedication to transparency. They provide honest and clear information regarding their fees, minimum purchase requirements, and product pricing. The company’s integrity helps them maintain an excellent standing with their customers, and it’s one reason they have never had a negative customer review.
In addition to gold, they sell silver and other precious metals that meet the government’s purity standards. This ensures the investors who open a gold IRA with them can always find the right products to meet their investing goals.
They are also known for providing extensive customer service to their new and existing customers. They can help you with your rollover to ensure you meet all of the IRS’ requirements, and they partner with IRA custodians and government-authorized depositories to help you set everything up as conveniently as possible.
To help you get started in investing in precious metals, they provide a wide range of educational resources. You’ll have access to real-time market updates to help you see how your metals are performing. They provide the resources to help you meet any wealth goals you have for yourself.
The initial required purchase minimum is $50,000.
#2. Goldco
After more than 17 years in the precious metals market, Goldco has earned a solid reputation among investors. In addition to the products they sell to gold and silver IRA investors, they sell collectible coins that may not meet the IRS’ fineness standards but do satisfy collectors. This means you can find precious metals to meet any interest.
One thing that sets Goldco apart is their extensive library of resources that are designed to help their customers learn the ins and outs of investing in precious metals. While the other companies provide some educational materials, few can compare to the vast resources available through Goldco. To begin, they will send you a startup kit just for showing interest in their company. The kit will tell you more about their services and provide you with the basics of investing in gold and other precious metals.
You’ll find that it’s easy to get started with Goldco since they can connect you with their preferred self-directed IRA custodians. They also work with Delaware Depository and Brinks Salt Lake City for added convenience in setting up your secure precious metals vault.
While American Hartford Gold is available to investors at any experience level, investors who are newer to precious metals will find their terms especially attractive. As is the case with most precious metals IRA companies, American Hartford Gold does require a minimum purchase, but their requirement is much lower at $5,000. In addition, new customers who meet qualifying purchases are eligible for a free gift of silver equivalent to $10,000.
This company offers one of the most generous buyback programs in the market. They guarantee to buy your precious metals from you when you decide to start taking retirement distributions. They offer fair prices on their buybacks to ensure each customer is getting the current market value for the precious metals whenever they decide to liquidate their bars or coins.
If you need help setting up your account or rolling over from another retirement account, they will be available to assist you. Their customer service also includes help in evaluating your investing needs to ensure you make purchases that will help you meet your goals. This is especially helpful when you’re well into your retirement and need to grow more wealth to meet your changing needs. In addition, they can help you choose an IRA custodian and U.S. depository in completing your account startup.
Final Thoughts
Even if you're many years from reaching retirement age, familiarizing yourself with good money management practices beyond age 72 can help you create a better plan for your future. Ensuring your money is always working for you will help you grow more wealth as you live a longer life, and investing in gold can help you meet your changing needs when you surpass 90. As a physical asset, your gold will grow in value over time, giving you access to greater financial resources when you will need them the most.
