What is a Gold IRA Company? Definitions, Roles & History


What is a Gold IRA Company?

A gold IRA company is a specialized business allowing investors to buy gold for retirement. Most traditional IRA custodians don't allow gold or precious metals in an IRA. The gold IRA company makes it possible for investors to own physical gold for retirement. A gold IRA company is usually a precious metals dealer that works with a gold IRA custodian. The gold dealer provides the precious metal while the custodian holds the metals for the gold IRA.

A gold investment company offers gold and other precious metals for investment or collection. It sells both IRA-eligible and non-eligible precious metals. Some gold investment companies are also gold IRA companies.

A gold IRA custodian is a nonbank trustee approved by the IRS to hold precious metals for an IRA. A gold IRA custodian executes transactions on the client's behalf. They don't give financial or investment advice.

A gold depository, or a precious metals depository, is an independent storage facility for precious metals. It must meet the standards of the IRS to hold the physical gold for gold IRAs.

A gold dealer, or a precious metals dealer, is a company that specializes in buying and selling gold and other precious metals. The metals should conform to IRS standards to be allowed in an IRA.

A gold IRA is a self-directed IRA that holds physical gold in a retirement savings account. Gold is not available from traditional IRA companies such as banks and brokerages. A gold IRA works like a traditional IRA. It follows the same tax advantages and IRS rules. It has special rules for the type of precious metals allowed in the IRA. the storage rules for precious metals depositories must meet IRS standards.

A gold-backed IRA is the same as a gold IRA.

What do gold IRA companies do?

Gold IRA companies do the following:

  • Educate customers on the precious metals market so investors can make informed decisions.
  • Liaise with the gold IRA custodian to open and fund a client’s gold IRA account. Gold IRA companies offer the following types of self-directed IRA: traditional IRA, Roth IRA, and SEP IRA. Some of them also offer silver IRA, platinum IRA, and palladium IRA.
  • Facilitates the purchase of precious metals. Most gold IRA companies are precious metals dealers.
  • Ensures precious metals conform to IRS standards
  • Ship precious metals to the client’s designated depository.
  • Service a client for the lifetime of the account
  • Serves as liaison between the gold IRA Custodian and the client

Gold IRA companies do not give financial, investment, or tax advice. They also don’t insure against loss or check the investment choices that an investor makes.

Gold IRA custodians have the following roles:

  • Provides information and reports needed for annual IRS reporting needs.
  • Assist in opening and funding your gold IRA.
  • Carry out buy, sell, withdrawal, transfer, and rollover orders for the client.
  • Record and title precious metals in storage
  • Issue regular statements
  • Tell clients when a Required Minimum Distribution is needed.

Like gold IRA companies, gold IRA custodians do not give financial, investment, or tax advice. They also don’t give insurance protection for investment loss or monitor the performance of an investor’s portfolio.

Gold depositories do the following:

  • Maintain the correct storage environment and security
  • Do regular security and inventory audits.
  • Constantly upgrade security measures to keep with advances in technology
  • Get enough insurance to cover the stored gold and other metals against loss. Gold depositories are not FDIC-insured. They get full insurance coverage from private insurers to protect owners from loss.

An investor cannot store gold held in an IRA in their home. If they get physical possession of the gold in their IRA, it will be considered a distribution and will be subject to taxes and an early withdrawal penalty if applicable.

History of gold IRA companies

Beginning of IRA Companies

The Employee Retirement Income Security Act (ERISA) of 1974 created IRAs. Before ERISA, employees received defined-benefit pension plans. These plans rewarded employees for loyalty to the company. But companies moved away from defined-benefit plans because of the huge cost. It was not sustainable for companies. Employees did not have a reliable way to save for retirement until ERISA came along.

ERISA gave employees a tax-advantaged way to save for retirement. This supported employees whether or not the company had a pension plan. The IRA proved popular with many investors and there was a boom in retirement savings. But for a long time, IRAs only held stocks, bonds, ETFs, or mutual funds. Alternative assets were not an option.

Beginning of gold IRA companies

Self-directed IRAs then became popular in the 1990's to introduce alternative assets. Assets like real estate started to become part of IRAs. But, precious metals were not included until the creation of the Taxpayer Relief Act of 1997.

With this law, certain precious metals were now allowed into self-directed IRAs. This led to the creation of gold IRAs and the gold IRA company.

How to choose a gold IRA company?

Here are the steps to choose a gold IRA company.

  • Check the Better Business Bureau, and similar rating sites for customer reviews. Look for insight into their level of customer service. Opening a gold IRA is a long-term relationship. An investor will want to have a partner they can rely on.
  • Compares their fee structure. Compare their one-time fees vs the recurring annual fees. Compare the spread they charge on gold purchases. Some dealers may offer zero-commission purchases but charge a high spread.
  • Check their other value-added services. Do they offer quality investment education? Do you get dedicated account executives? Do they help if you want to do a gold IRA rollover? Do you get help in IRS reporting? Do they have convenient online systems that allow you to track your assets? These are the questions an investor should ask to make an informed decision.
  • For a gold IRA custodian, check their capabilities, expertise, and technology solutions. Check their coverage area – are they regional or global?
  • For a gold depository, check their security practices and insurance coverage.
Many of the big traditional IRA companies, like Vanguard, don’t offer gold IRAs. They don’t carry precious metals in their product portfolio because they don’t make money from alternative assets.

Does Vanguard have a gold IRA?

Vanguard does not offer a gold IRA or a gold ETF. They have the Vanguard Global Capital Cycles Fund (VGPMX) which has a portion invested in the precious metal industry.

Does Fidelity have a gold IRA?

Fidelity does not offer a gold IRA, but they have started to offer precious metals trading. You can buy IRS-approved gold for your Fidelity IRA, but you need to take of finding a depository to store your metals. Fidelity will not hold the metals on your behalf and they are merely acting as an agent for your purchase.

What are the gold IRA fees that companies charge?

You need to be aware of the fees involved when opening a gold IRA.

  • Setup fee. The fee charged when opening a new gold IRA account. This fee is waived by some gold IRA companies depending on the size of your initial investment.
  • Custodian fee. This is an annual fee paid to the gold IRA custodian that goes into maintaining your account.
  • Storage fee. The is an annual fee charged by the gold depository for storing precious metals in its facilities.
  • Insurance. This is typically included in the depository’s maintenance fee. This goes to paying the insurance policy to insure against loss or damage for storing precious metals.
  • Delivery fee. The fee paid for transporting precious metals which requires a higher level of care and security.
  • Gold Spread. The premium paid for buying or selling precious metals. This is how gold IRA companies mainly make money.

Gold IRA Pros & Cons


  • Hedge vs. inflation, devaluation & uncertainty
  • Diversification. Non-correlated asset.
  • Tangible asset. Recognized as currency.


  • Fees for storage, transport & insurance
  • No dividends or passive income
  • Needs special handling.

Difference between gold IRA vs physical gold

Gold IRA

  • Regulated by the IRS. Gives tax advantages depending on the type of IRA
  • Stored at an approved depository. You cannot physically possess the gold while it's in your IRA.
  • Withdrawing gold from your gold IRA can have tax implications, and a penalty if done before 59 ½ years of age.
  • Not all types of gold can be included in a precious metals IRA. The gold must meet the fineness requirements set by the IRS.
  • Subject to annual contribution limits

Physical Gold

  • No tax advantage. Subject to capital gains tax when selling.
  • You have possession but you are responsible for storing and securing your own gold against theft.
  • You can sell at any time subject to paying capital gains tax
  • Can buy any type and form of gold.
  • No contribution limits

What type of gold or metal can be held in a gold IRA account?

Gold or precious metal in an IRA should follow standards outlined in Section 5112 of Title 31 of the US Code. The gold American Eagle coins fit exactly to these standards. Other coins that fit are the Canadian Maple Leaf gold coin, the Australian Gold Kangaroo, and others.

 Coins are not the only form of precious metal allowed. Bullion bars and rounds that fit fineness requirements are also allowed. The purity should be 99.5% pure for gold, 99.9% for silver, and 99.95% for platinum and palladium. These bullion bars should be made by gold refiners or manufacturers approved by COMEX, LBMA, LME, or a national government mint.


A gold IRA company is a key partner for the retirement investor. Building a gold IRA investment is a long-term plan. It is important to understand what a gold IRA company offers and know how to choose the best gold IRA company. Be sure to know what its responsibilities are so that expectations are clear.

It’s also important to understand how to invest in a gold IRA properly to avoid costly mistakes. Understand the tax implications, the pros and cons of having a gold IRA, and the tax implications. Mistakes in gold IRA investing can be costly and can compound over time. It’s better to understand everything that you need to know in order to avoid making a huge mistake. Augusta Precious Metals has an excellent educational program for gold investing.

About the author 

Ronald Cagape

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