When opening a precious metals IRA with Augusta Precious Metals, the fees are a big steal. The gold IRA fees are only $80 for the one-time account setup and $180 for maintenance fees every year.
As we break down the fees, you will see that these are among the lowest in the industry. Considering the reputation of Augusta Precious Metals as a company that delivers excellent customer service and world-class education, the fees are worth every penny.
We are confident that you will reach the same conclusion - Augusta Precious Metals is the best gold IRA company in the United States to help you invest in precious metals for your retirement portfolio.
Augusta Precious Metals Fees & Minimum Investment
Here are the fees when opening a gold IRA. First is a custodian setup fee of $50. This one-time fee is paid to their preferred custodian Equity Trust. In addition, there is a $30 wire transfer fee for a total setup cost of $80.
Then there is the custodian maintenance fee of $80. This is paid annually also to Equity Trust. Whether you open an account with Augusta, another company, or go directly to Equity Trust, you will pay an annual maintenance fee. With Augusta's partnership with Equity Trust, this is a flat fee, meaning it’s the same amount whatever the size of your retirement account. This is important because some companies charge a fee that scales up with the size of your investment thus increasing your recurring costs.
Then there is an annual storage fee of $100. This is paid annually to the precious metals depository where your gold and silver are stored. This is also a flat fee similar to the custodian maintenance fee because Augusta has a partnership with Delaware Depository. This is a big deal because as your investment grows, it actually needs more storage space so paying only a flat fee translates to huge savings over the years for retirement investors opening a gold IRA through Augusta.
You must invest at least $50,000 to open a gold IRA with Augusta. The account can be funded through a check or wire transfer; an IRA transfer; or a rollover from other retirement accounts into your gold IRA.
Does Augusta Precious Metals charge any gold IRA account management fees?
Augusta Precious Metals does not charge any gold IRA account management fees because a gold IRA is a self-directed IRA. Augusta does not manage your account. They do not buy or sell precious metals. You, as the account owner will make the decision when to buy or sell.
This is different from a mutual fund or gold ETF where there is a fund manager that makes all the trading decisions. A managed fund has a management fee to compensate the fund manager. There is no need for this in a physical gold IRA.
Augusta Precious Metals is also not a financial advisor and they are not qualified to give financial advice. Again, as the owner of a self-directed IRA, you make your own decisions. But what Augusta does is provide world-class information and education so you can make informed decisions.
That’s why they have Devlyn Steele, a Harvard-trained economist, leading the education team at the company.
How does Augusta Precious Metals Compare with the Fees of Competitors?
From this table, you can see that Augusta charges competitive fees. Their partners - Equity Trust and Delaware Depository offer very competitive prices.
If you will remember, August Precious Metals does not charge any fees themselves, the setup fees and annual fees are from the custodian and depository.
While it may be tempting to check out companies like Noble Gold, American Hartford Gold, and Regal Assets because they don’t charge any setup fees, these companies have had multiple complaints against them on the Better Business Bureau and Business Consumer Alliance. In particular, Regal Assets has low ratings on BBB and is facing serious fraud allegations on the site.
On the other hand, Augusta Precious Metals has no pending lawsuits and zero complaints while having an A+ rating on the BBB. While a lawsuit against Augusta was filed in 2018 in Sacramento, California, the case has been dismissed so Augusta maintains their pristine reputation.
We believe having complete peace of mind is more valuable and worth the price.
But to even the playing field, you may want to check with Augusta if you qualify to have your annual fees waived for up to 10 years. That is a much higher value than waiving the one-time setup fee.
What is the advantage for customers to set up an IRA with Augusta as opposed to going to the custodian and setting it up with them?
The advantage for customers to set up an IRA with Augusta Precious Metals as opposed to going to the custodian and setting it up with them is having a flat annual fee schedule for custodian and storage fees. If you go directly with a custodian and a depository, you will pay fees that scale with the size of your investment, in addition to paying additional costs.
The annual custodian fee for Augusta Precious Metals is only $100. If you go directly to Equity Trust, you will pay a scaling fee shown in the table below.
In the same way, if you go straight to Delaware Depository you will have to pay the shipping costs to have your precious metals delivered. Then you will have to shoulder the annual storage fees. Since you don’t have the benefit of the partnership that Augusta has with Delaware Depository, you will pay higher prices that scale with the size of your investment.
You could store your precious metals in a bank safe deposit box but not all banks conform to IRS standards. If they do, you still end up paying more because as your investment grows, the fees you pay for the safe deposit boxes increases. The standard 3” x 5” boxes are not big enough to store large amounts, especially silver which is bulkier and dense than gold. Thus, you will end up paying more.
Also, gold has special storage conditions to maintain its quality. Gold should be protected against high humidity and temperatures should not drastically change. Your bank may not have these because their safe deposit boxes are not specifically designed to house precious metals.
And talking about storage, you have to properly pack your metals, especially gold coins and silver coins. If not packed properly, they will get dings or scratches which devalue the coins.
Therefore, it’s better to go through Augusta in storing your gold and silver.
Is a precious metal IRA a good idea?
A precious metal IRA is a good idea for retirement investors who want a reliable hedge against inflation, currency devaluation, and sudden market downturns.
Isaac Nuriani, who owns Augusta Precious Metals, experienced the 2008 financial crisis where retirement accounts were wiped out by as much as 53% at its worst. Many baby boomers who were planning on retiring at around that time could not do so because of the damage to their retirement portfolios.
They couldn’t sell their stocks because they would lose so much value. If they had precious metals in their retirement portfolio, they could’ve sold those instead to have liquidity while waiting for the market to recover.
So, is a gold IRA a good idea? Yes, we believe that a gold IRA is a good idea to protect retirement portfolios from market risks.
How much of your portfolio should be in precious metals?
The amount of precious metals that should be in your portfolio ranges from 5% to 15%, depending on your circumstances and the composition of your portfolio, according to Augusta and various financial advisers.
Jim Cramer of Mad Money recommends putting 10% in gold as an insurance policy for your portfolio. Shark Tank Investor Kevin O’Leary has 5% invested in gold. Oxford Economics in a study they conducted on the role of silver in a multi-asset portfolio found that 4-6% is the optimal allocation.
Deciding how much gold and silver to hold in your portfolio is a personal decision that depends on your risk tolerance and the existing asset mix of your portfolio. Generally, a portfolio that is more conservative and diversified across many asset classes can have 5% in physical precious metals.
Otherwise, going for 10-15% can be enough to provide liquidity to ride out the dips in the market and economy.
What is the average rate of return on precious metals?
The average rate of return on precious metals ranges from -0.3% to 28.1% depending on the metal and the time period used to calculate returns. These figures were calculated over a 34-year period from 1974 to 2020 by Unboundinvestor.com.
They also calculated the best average return over a 10-year period between 1974 and 2020. Why start in 1974? This was the year when it became legal for citizens of the United States to own gold again.
From 1933 to 1974, it was illegal for private citizens to own gold. So you can’t own any physical gold bullion like gold American Eagle coins or gold bars. Even a single gold coin or gold bar was illegal to have. During this period, the price of gold was fixed and controlled by the US government. Eventually, the restrictions were lifted after 1974 and the price of gold followed market forces.
So from 1974 to 2020, the average rate of return of silver is the lowest among precious metals at -0.3% but it had the 2nd highest best average return over a 10-year period at 23.5%. The average rate of return for gold is 5.8% and its best average return is 19.4%.
The average return for platinum is 2.8% and its best average return is 13.2%. The average rate of return of palladium is the highest among precious metals at 8.6% and the highest best average return at 28.1%.
So from this data, it may seem like palladium is the best precious metal to own but again, getting a high rate of return is not the objective when investing in precious metals. Palladium is more volatile in price than gold because, like silver, it has many industrial applications. Therefore, like silver, palladium also carries more risk than gold.
We believe gold is still the best precious metal to own in a diversified retirement portfolio. It reduces the exposure of the portfolio to market risks and gives it stability in times of uncertainty.
Are gains from precious metals taxed?
Yes, like any other investment, gains from precious metals are taxed. For gold held less than 1 year, it’s taxed at the ordinary income rate. If held for more than 1 year though, it’s taxed at the maximum capital gains tax rate of 28% for collectibles.
But for physical gold held in an IRA, gold IRA tax rules say that gains are not taxed until cash distributions are made to the investor. These distributions are taxed at the marginal tax rate. Note that early distributions or those done before 59 ½ years of age are penalized at 10% in addition to the tax.
According to Steve Smith and Ron Singleton, professors of accounting from Western Washington University and writing for the Journal of Accountancy, holding gold in an IRA can increase the after-tax returns significantly.
Please don’t take this as financial advice though. It’s best to consult a tax professional for your specific situation.
How to Invest with Augusta Precious Metals
Start by requesting a free gold IRA information kit to get information on how to invest with Augusta Precious Metals, This will also provide you with what you need to know to get started with precious metals investing.
After consuming the information kit, schedule a 1:1 web conference to get answers to any other questions you might have and get instructions on the next steps.
Augusta Precious Metals is a legitimate company that makes its low fees a great deal. You would expect that with the high ratings that they get from the BBB, BCA, and Consumer Affairs they would charge premium fees. You have seen that they don’t charge premium fees at all, which makes their dedication to excellent customer service more impressive.
You can find more information about the company in our Augusta Precious Metals review. You will find the actual ratings, customer feedback, and all the reasons why Money Magazine and IRAGoldAdvisor.com choose Augusta Precious metals as the best gold IRA company in the country.
What makes Augusta Precious Metals unique is its ability to give amazing customer service and excellent investor education while charging one of the lowest fees in the industry. The management and the staff of Augusta have to get full credit for their ability to fulfill their declared mission to help retirement investors build safe investment portfolios while still operating a successful business.
When mission-focused businesses execute brilliantly, it’s a win for the customers. We are confident in recommending you open your gold IRA with Augusta Precious Metals.