Letter Re: Precious Metals 401(k) Investments?

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Jim,
I have been thinking about my 401(k) money that I can't get to till I am 59-1/2. I have done some homework on it, and here is what I have found out. Our Federal Government has confiscated the gold eight times in the past. When they do, they pay face value. Double Eagles are $20.00, that's it. Talk about taking it in the neck! There is a way to put gold into an account, where it is stored for $100.00 per year, in the owner's name, but it seems one cannot get [numismatic] pre-1933 gold coins (which are non-confiscatable) put away in this manner. I am wondering if any of your readers might know of any coins that can be stored this way that are not subject to confiscation?
The places I have talked to are Lear Financial, and Midas Resources. They both put the gold physically in a vault somewhere in Delaware. Supposedly the largest vault in the US.
If I pull my money out of the account before I am 59.5 years old, I end up losing almost 50% to taxes and penalties. Maybe 50% is better than potentially nothing? Then I could invest in numismatics, or silver, neither of which are subject to confiscation, for all I know. -  Sid, Near Niagara Falls

JWR Replies: There is no sure way to avoid confiscation if your gold is held by any banking institution. The politicians might even get grabby with numismatics.  I have a gold self-directed IRA vault account with . They hold a small quantity of Gold Eagles in my name.  I'm a big believer in investing in tangibles. I do have an IRA, but since 1999 it has been a self-directed gold coin IRA with American Church Trust. The folks at Swiss America can help you set one up. Under some circumstances a 401(k) can be rolled over into an IRA. You might consider that. Parenthetically, I should mention that I'm 45 years old. The pessimist in me says that there is no 100% guarantee of ever cashing out my gold IRA. So I'll never increase the size of that account to any a substantial percentage of my net worth.  I believe in tangibles, in hand!

I recommend that you consider any IRA and/or 401(k) strictly a "maybe." At least the dollar units that they are denominated in is a maybe, so that makes the whole proposition a maybe. The majority of your gold and silver should be kept at home, very well hidden  Do not trust safe deposit boxes. You never know when some "emergency" will be declared. If that were to happen, then the only way that you'll ever get back into you safe deposit box is in the presence of taxing officials and their armed minions. That is the way that modern government works, all over the world: wormy little bean counters with clipboards, and big dumb oafs with guns to back them up. Call me paranoid, but I understand both human nature and the nature of government.

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This page contains a single entry by Jim Rawles published on December 19, 2005 6:04 PM.

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