Investing Precious Metals in Your Retirement Account

Many retirement investors have been in the game long enough to know that they are not getting what they need from their investments. Technically, the stock market is up at present. The problem is that everything else is up as well. What good are your advancing index funds going to be if inflation is pushing prices up even faster?

There is one sure way to defeat inflation with your retirement account. No matter what kind of retirement plan you have now, you should investigate ways of opening up its range of investment targets to include precious metals.

If you cannot do that, then you should move heaven and earth to get your funds safely into an account that permits precious metals investments. These assets are the classic hedges against inflation. Best of all, they have even been outpacing inflation in the last few years as their demand goes up for a variety of reasons.

Why Are Precious Metals the Best Retirement Investment?

Investing in precious metals strikes some people as a little medieval. After all, this is the age of the Internet, digital technology, and cloud computing. Buying chunks of silver and gold seems like a throwback.

The truth is that these assets have a foot in both worlds.

Precious metals are ancient investments. People have been buying or seizing these metals for thousands of years to get ahead in the world. They are very solid and very real. This is what draws people to them in this day and age when they lose confidence in paper currencies and digital money that the Federal Reserve can produce whenever the government needs more money.

Yet precious metals are also important elements in the modern economy. They are not just refugees or sanctuaries for people who are afraid of progress. Whether you buy silver, gold, or platinum, you buy something that plays a major role in technology.

These metals are resistant to corrosion and conduct electricity well. One-third of the platinum minted today is sent off to be turned into catalytic converters for cars. Silver is used in electrical contacts in countless devices. Gold has the most modern application of all. Used for the most sensitive connections, there is probably a dollar’s worth of gold in every cell phone and mobile device around.

These uses provide great support to the advancing values of precious metals. They also offer aspiring retirees the perfect assets to guarantee a certain quality of life when they quit working. Instead of arriving at retirement with investments that have underperformed for years, they can stop working and know that they have something solid and in demand in their possession.

Precious metals will continue to preserve their wealth even after they retire. If they invest in physical coins and bars, they will be able to hold these investments in their hands and decide what to do next.

What Kind of Precious Metals Are Best?

The first rule of investment is to diversify and this rule still holds when you invest in precious metals. Not only should you take at least a small amount of all kinds of precious metals into your portfolio, but it would also be wise to invest in them in different ways.

• Silver

This is the least valuable of all precious metals when you look at prices per ounce. Do not let that value allow you to underestimate this precious metal.

In many people’s opinions, silver may have the most potential for gains at this point. If you are going to switch your retirement investments into precious metals now, you may want to shift the lion’s share into silver.

While gold and platinum are worth much more per ounce, silver has outperformed them in terms of proportional gains over the last decade. It also appears to have enough upside left to make significant gains shortly.

• Gold

Gold is worth more than $1,700 per ounce right now. It may not be able to repeat the incredible performance that it has had over the last 10 years, but the fiscal cliff may hold a lot of advantages for gold investors. Some people are foreseeing gold prices of over $2,000 shortly, depending on how the US government deals with its present financial crisis.

• Platinum

Historically, this precious metal has always maintained a higher value than gold, believe it or not. At present, gold is worth more because its value has been pushed through the roof by rising demand. However, platinum is starting to recover its position and has already broken the $1,600-per-ounce mark.

You can buy these precious metals in the form of coins and bars. You can also invest in them less directly as stocks in mining companies or as exchange-traded funds. The wisest choice for retirement investing would be to spread your money in all forms of precious metal investments.