Top 10 Gold IRA Scams Investors Should Avoid Getting Burned

Individual Retirement Accounts (IRAs), are a popular retirement account for more than 62 millions Americans.

Many investors are now turning to gold and gold IRAs for safer investments as the stock market becomes more volatile. Experts are worried about a possible downturn.


Scammers are everywhere there is money to make, and gold IRAs don't seem to be any exception. There are ways to avoid scams with gold IRAs and protect your retirement.

Check out these most common gold scams

  1. Home storage gold IRA
  2. Rare coins
  3. Collectable/Numismatic coins
  4. Counterfeit coins
  5. Non-delivery/Ponzi Schemes
  6. Pushy salespeople
  7. False contracts
  8. Shaved coins
  9. Bait and Switch Scam
  10. Hidden fees

What is a Gold IRA and how can it help you?

You cannot protect your gold for this type retirement fund, according to IRS regulations. An IRA custodian is required.

Companies cannot guarantee IRAs free of charge, so they will have to charge maintenance fees for sourcing or managing your gold.

Some companies make money by ripping off investors who don't have experience with precious metals.

Common Gold IRA Scams

Many investment scams are designed to siphon off money from unsuspecting investors. This list does not include all of the scams that are common.

If you are unsure whether a company has credibility, consult a financial advisor.

Home Storage Gold IRA

The IRS requires precious metals to be stored in approved depositories for an IRA. A company that advertises "home storage" for a gold IRA is a fraud.

Even if the company promotes a "free safe" and "additional coin" that you can take home (but not your entire investment), it should alarm you.

Home storage companies are intentionally misleading customers.

Rare Coins

Rare coins should not be considered IRA investments. You should concentrate on the spot gold price when you buy or sell gold, and not on rare coins.

It is important to know what types of bullion and coins are allowed in a precious-metals IRA. Look for another IRA dealer if a precious metals dealer tries to sell you coins that are not approved by IRS.

Only a reputable company will offer this type of investment for an IRA in precious metals.

  • Gold: All gold used in your IRA must contain 99.5% purity, except for Gold Eagle coins. This is something that a reputable precious metals dealer should know.
  • Silver:Silver bullion and coins must be 99.9% pure in order to qualify for an IRA.
  • Palladium:Palladium should be at least 99.5% pure
  • Platinum: platinum must be at minimum 99.5% pure in order to be eligible.

It is a sign that a company may be trying to get you to buy rare coins, rather than bullion or common-gold coins.

They likely receive a commission for rare coin sales. Their interest in you is short-term.

Collectable/Numismatic Coins

Investors can add gold and other precious metals into their investment portfolios with Gold IRAs. All gold and precious metals that you invest in must reflect the intrinsic value of those metals, not their collectible values.

Any IRA custodian advertising special edition coins or collectible coins is at best intentionally misleading you. The IRS doesn't support collectible coins being legitimate investments for gold IRAs.

Counterfeit Coins

Fake coins are a common con. It can be hard to avoid these scams because counterfeiters cover less-valuable bullion and coins in gold to make them look legitimate.

A scale is a good option if you want to inspect the gold you are interested in buying in person. This is the best method to establish legitimacy.

If you don't have the luxury to see the gold ahead of time, you will need another method.

If you are purchasing directly from a depository, review your IRA company and compare ratings with the Better Business Bureau.

Non-Delivery/Ponzi Schemes

Ponzi schemes are frauds where a portfolio manager or dealer promises future investors that they will use funds to repay past investors.

This could be used to give your money to a company for gold purchases. It will instead spend your money on an unrelated purchase or buy gold for another investor.

If the company succeeds in convincing another potential investor to join its scheme, it will be able give you your gold.

It can be difficult to tell if you are dealing with a Ponzi Scheme. It is best to examine the shipping times for your goods to determine if you are dealing with a Ponzi Scheme.

It is possible that the company isn't using its funds properly if shipments are delayed for several months.

Pushy Salespeople

Some salespeople might try to convince you to invest urgently, warning that you may miss an opportunity if this happens. This is almost always a sign that the scammer is trying to con you.

Avoid pushy sales pitches. Be clear about your investment goals and follow them.

These sales tactics can be a red flag and signify that the salesperson is pushing too hard.

  • Guarantees of high returns and quick returns:Factoring in gold into retirement planning is a way to hedge against inflation while still generating steady, slow returns. You should not invest in gold for a high return, and be skeptical of any sales pitches that claim otherwise.
  • Pushing for quick decision: A reputable gold IRA company understands that retirement decisions shouldn't be taken in haste.
  • Searching for collectibles or coins: Gold and precious metals are commodities. Their value is determined by their metal content, not their demand.

False Contracts

Make sure you read every contract before signing it. It doesn't matter if you are buying a house or opening a precious metals IRA.

Do not sign a contract if you aren't sure if it is fair or if you don't understand the terms. For assistance, contact a contract expert.

The salesperson might pressure you to sign a contract as soon as they see it. This is a huge red flag.

You should have enough time to read and review the contract before you sign it.

Shaved Coins

Shaved coins is one of the most common gold frauds. This scam involves dealers cutting off tiny amounts of gold that are barely visible from every piece of gold they sell.

This is a tricky scam to avoid as your gold will likely go straight to a bank after you have completed the purchase. Many investors don't even see their gold.

This means that you won't be able to inspect your investment for signs of manipulation.

You can protect your investment and yourself by choosing a trusted dealer. Avoid new companies and companies with bad reviews.

Bait and Switch Scam

Companies that offer unlimited gold or other unimaginable bonuses should be avoided. It is possible that it sounds too good to be true.

Many companies will offer you a great deal such as buy-backs at inflated prices or bullion coins. But then they'll pull the plug and charge you.

Ask for additional time if you are unsure about the legality or reliability of a deal or the legitimacy and validity of a promotion.

Do not agree to sign a contract if a salesperson presses you more and insists that the offer "only happens today". This is almost always a bait-and-switch.

Hidden Fees

A company that asks you to invest in precious metals must clearly explain the fees to you upfront.

It is a warning sign that a salesperson mentions higher or different fees during a conversation.

These are the most popular fees for gold IRAs.

  • One-time account opening fee: Most companies offering gold IRAs charge a one time fee. For significant initial investments, this fee may be waived.
  • Account management Fee:IRA dealers may charge you an account management cost. This fee usually ranges between $100 and $300.
  • Storage Fee:Because your investment must be kept in an IRS-approved bank, you will need to pay a fee for managing your gold safe.
  • Spot Price Fee: You may be charged a little more than the market price of gold for an IRA investment. This is normal as you are not purchasing directly from a precious metals broker.

A company should however declare markups in the beginning of the investment process, and not surprise you later.

You may be dealing with a fraudster if you are charged large, additional fees beyond those mentioned above.

Five Tips to Avoid the Gold IRA Scams

1. Make sure you do your research. You should check several reliable sources for information about a company. You should avoid a company with a lot of negative reviews.

2. Third-party review sites are a good place to start: Positive reviews and testimonials tend to be more common on a company's website, but negative reviews will likely be filtered out. Trustpilot is a trusted third-party review site that will give you a balanced view.

3. Ask for references from customers. Reputable companies that offer gold IRAs will not hesitate to put you in touch with satisfied customers, particularly if you are considering large investments.

4. The Better Business Bureau: Many gold IRA providers have A+ ratings with the Better Business Bureau. You should not choose an option that has less than the best.

5. Talk to your financial advisor. Your financial advisor probably has more experience in identifying and recognizing scams than you. Don't hesitate to ask them about certain companies.


  • This is a sign that a salesperson may be trying to get you to sign or make a purchase quicker than you are comfortable with.
  • Companies that promise high returns and claim gold is low-risk investments should be avoided. It is possible to lose your money if you invest in gold.
  • Do not choose a company that does not offer the opportunity to meet with financial advisors and contract lawyers.
  • Look for a company that has a lot of positive reviews, and who isn't interested in its success.
  • To protect others investors, report any scams that you may have fallen for.

Augusta Precious Metals

Augusta assists retirement savers by helping them diversify their savings with gold or silver. Get their free guide to gold IRAs.

You earn a commission when you invest.

Frequently Asked Questions

What is the most valuable precious metal?

High returns on capital are possible with gold investments. It protects against inflation, as well as other risks. As inflation worries increase, gold prices tend to rise.

It is a smart move to purchase gold futures. These contracts guarantee that you will receive certain amounts of gold at a given price.

Gold futures are not for everyone. Some prefer physical gold.

They can also trade their gold easily with others. They can also make a profit by selling their gold at any time they desire.

Some people also prefer to avoid paying taxes on their gold. To avoid paying taxes on their gold, they purchase it directly from the government.

This requires that you make multiple trips to the local post office. You must first convert any existing gold into coins or bars.

Then you will need a stamp to attach the coins or bars. Finally, you send them to the US Mint. The US Mint will melt the coins and bars to make new ones.

These bars and coins are stamped with the original stamps. These new coins and bars are legal tender.

However, if you purchase gold directly from the US Mint you won't be required to pay any taxes.

What precious metal would your investment preference be?

Does a gold IRA earn interest?

It all depends on how much you invest in it. If you have $100,000 then yes. You will not be able to answer if your income is less than $100,000

The amount you invest in an IRA affects its ability to earn interest.

If your annual retirement savings contributions exceed $100,000, you might want to open a brokerage account.

While you will probably earn more interest there as a result, you'll also be subject to riskier investments. If the stock market crashes you don't wish to lose your entire investment.

However, if you only put in $100,000 per annum, you'll probably be better off with an IRA. At least until the market starts growing again.

Which is stronger, 14k or sterling gold?

Gold and silver are strong metals, but sterling silver is much less expensive because it contains 92% pure silver rather than just 24%.

Sterling silver is also known as fine silver because it is made from a mixture of silver and other metals such as copper and zinc.

The strength of gold is generally very high. It takes great pressure to break it apart. If you drop something on top of a chunk of gold it will shatter into thousands of pieces rather than breaking into two halves.

But silver isn’t nearly as sturdy as gold. If you dropped an object onto a sheet silver, it would bend and fold with no damage.

Silver is often used to make jewelry and coins. Therefore, its value tends to fluctuate based on supply and demand.

What are some of the advantages and disadvantages to a gold IRA

The gold IRA is a great way to diversify your portfolio, but you don't have access the traditional banking services. It allows you to invest in precious metals such as gold, silver, and platinum without paying taxes on any gains until they're withdrawn from the account.

The downside is that withdrawing money early will pay ordinary income tax on the earnings. The funds are not located in the country and can be easily seized by creditors if your loan defaults.

So if you like owning gold without worrying about taxes, a gold IRA may be right for you.

Is gold IRAs a good way to invest?

You should buy shares in companies that produce gold. You should buy shares in these companies to make money from investing in gold and other precious metals such as silver.

There are however two problems with owning shares directly.

You can lose money if you hold onto your stock too long. Stocks that fall are less than their underlying asset (like silver) and can end up losing more money. This means that you might end up losing more money than you make.

You may also miss potential profits if the market recovers before you sell. Be patient and wait for the market's recovery before you make any profits from your gold holdings.

Physical gold can be beneficial if you prefer to keep investments separate from your finances. A gold IRA can help diversify your portfolio and protect against inflation.

Visit our website for more information on gold investing.

What is a Precious Metal IRA and How Can You Benefit From It?

Precious metals are an excellent investment for retirement accounts. They have been around since biblical times and continue to hold value today. A great way to diversify and protect your portfolio is to invest in precious metals such silver, gold, and platinum.

Some countries also allow citizens to keep their money in foreign currency. You can purchase gold bars from Canada and keep them at your home. Then, when you go back to visit family, you can sell those same gold bars for Canadian dollars.

This is a very easy way to invest in precious metals. It's particularly helpful for people who don't reside in North America.


  • The maximum yearly contribution to an individual's IRAs is currently $6,000 ($7,000 for those 50 years or older), or 100% of earned income, whichever is less. (
  • You can only purchase gold bars of at least 99.5% purity. (
  • To qualify as IRA allowable precious metals and be accepted by STRATA, the following minimum fineness requirements must be met: Gold must be 99.5% pure, silver must be 99.9% pure, and platinum and palladium must both be 99.95% pure. (
  • If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal so that you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (

External Links

How To

How to Open a Precious Metal IRA

Precious metals remain one of the most highly-valued investment options. Because they offer higher returns than traditional investments such as stocks and bonds, they are very popular. However, you need to be careful when investing in precious materials. Here's how to open a precious-metal IRA account.

There are two main types of precious metal accounts: physical precious metals accounts and paper gold and silver certificates (GSCs). Each type has advantages and drawbacks. GSCs, on the other hand, are more accessible and can be traded. Keep reading to find out more about these options.

Physical precious metals accounts include bullion, bars and coins. This option is great for diversification, but it has its drawbacks. Precious metals can be expensive to store, buy and sell. They can also be very difficult to transport due to their large size.

On the other hand, paper gold and silver certificates are relatively inexpensive. They can also be traded online and are easily accessible. This makes them an ideal choice for those who don’t desire to invest in precious metallics. But they don't offer as much diversification as their physical counterparts. They are also backed by government agencies like the U.S. Mint so their value could decline if inflation rates rise.

When opening a precious metallic IRA, make sure to choose the right account for you and your financial situation. Before you make that decision, here are some things to consider:

  1. Your tolerance level
  2. Your preferred asset-allocation strategy
  3. How long do you have to spend?
  4. You can decide whether or not to use the funds for trading purposes.
  5. Which type of tax treatment would you prefer
  6. Which precious metals would you prefer to invest in
  7. How liquid do you need your portfolio to be
  8. Your retirement age
  9. Where will you store your precious metals?
  10. Your income level
  11. Your current savings rate
  12. Your future goals
  13. Your net worth
  14. Special circumstances that may influence your decision
  15. Your overall financial picture
  16. Your preference between physical or paper assets
  17. Your willingness to accept risks
  18. Your ability to handle losses
  19. Your budget constraints
  20. Financial independence is what you want
  21. Your investment experience
  22. Your familiarity with precious and rare metals
  23. Your knowledge of precious Metals
  24. Your confidence with the economy
  25. Your personal preferences

Once you've chosen the right type of precious Metal IRA to suit your needs, it is time to open a dealer account. These dealers can be found via referrals, word-of-mouth, and online research.

Once you have opened your precious-metal IRA, it is time to decide how much you want to deposit. Every precious metal IRA account will have a different minimum initial deposit amount. Some accounts only require $100, while others may allow you up to $50,000.

As mentioned above, you can decide how much money you want to invest in your precious metal IRA. If you're looking to build wealth over a long period, you should probably opt for a larger initial deposit. You might prefer a lower initial deposit if you intend to invest smaller amounts every month.

You have many options when it comes to the type of investments you can make. These are the most commonly used:

  • Bullion bars. Rounds, and gold coins.
  • Silver – Rounds, and coins
  • Platinum – Coins
  • Palladium-Bar and Round Forms
  • Mercury – Bar and round forms


By: Donny Gamble
Title: Top 10 Gold IRA Scams Investors Should Avoid Getting Burned
Sourced From:
Published Date: Sat, 07 Jan 2023 13:29:45 +0000

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