When we invest in any product, we have to know that the product is legit. Beyond knowing if a company is reputable, we also have to know that the physical product they’re using is real and trustworthy.
When I review Gold IRA companies, I do a lot of research into whether or not they are using trusted gold, silver, platinum, and palladium. In my Top 5 Gold IRA companies, for instance, I devoted significant time vetting their products.
But if you’re out there looking into any precious metals product, there are some product tags and designations you need to look for. If you don’t find these hallmarks of authenticity, you might think twice.
Gold Coins for IRAs
The IRS only allows us to invest in certain gold and other precious metals in our IRA accounts. Before you click “purchase” on any gold for IRA purposes, you should always verify that the gold is IRS approved. The requirements are spelled out here. There’s a lot of jargon, and you can read the law from Cornell University’s website.
The bullet points you’re looking for are:
That seems like a small list, and there’s good reason. The United States has long-standing and excellent relationships with the Treasuries and Mints of the Britain, Australia, and Canada. But there are fraudsters out there. Here is a list of precious metals that are not approved by the IRS for retirement accounts:
This list is not exhaustive, as scammers are endlessly inventing new coins to pass off as investments.
A good IRA company will always list their coins by type - IRS approved or collectible. All of the IRA companies I’ve rated are trustworthy, and designate only the highest quality IRS - approved coins for investments.
IRS Approved Custodians
When you set up a Gold IRA, you are not able to take physical possession of the precious metals. Instead, they must be held in an IRS approved location. The IRS defines the custodian as “a bank, a federally insured credit union, a savings and loan association, or an entity approved by the IRS to act as trustee or custodian.”
Every Gold IRA company I’ve ever reviewed uses IRS approved custodians. A quality IRA company will proudly list their custodian, and offer their contact information and credentials.
COMEX and NYMEX
If you’re looking for gold that isn’t a coin, you need to look for a COMEX certification. Every industry has certifications. To be a registered nurse, you have to pass an NCLEX exam. To drive a truck you need a Commercial Driver’s License. In the world of Gold, you need a COMEX designation.
COMEX is an acronym that stands for The Commodity Exchange, Inc. It merged in 1994 with the New York Mercantile Exchange, or NYMEX, and together they are the US body that governs all precious metals exchanges, both physical gold and companies that primarily deal in gold, such as the futures market.
COMEX and NYMEX are not government agencies. Rather, they work hand-in-glove with the Commodity Futures Trading Commission to regulate the trade of commodities such as oil, grain, and yes, precious metals.
In addition to precious metals for an IRA, if you’re purchasing gold bars for physical possession, or futures in gold, you must always look for COMEX certification on the product, unless it is minted by the US Treasury or by an approved foreign Treasury.
If you are working with a company that offers “proofs” or commemorative coins, make sure that they are being offered as gifts - not as investments. That’s because, unfortunately, many of these coins have no monetary value, and cannot be counted as investments by the IRS. Furthermore, they are sometimes not worth much on the open market.
In that regard, always be aware that when you invest $10,000 in a Gold IRA you are getting $10,000 worth of IRS approved coins, or COMEX certified raw gold. If the company wants to gift you a non-investment collectible on top of that, that’s great. But don’t let them call that an investment.