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Lear Capital Explains How New Precious Metals Investors Can Get Started

If you’re not sure exactly how to invest in them, Kevin DeMeritt, founder and chairman of Lear Capital — which has successfully processed more than $1 billion in precious metal IRA-related transactions — outlines the steps that are involved below.

Author:Frazer Pugh
Reviewer:Emmanuella Shea
Apr 03, 2023
Precious metal assets, such as certain gold and silver coins, can potentially be an advantageous investment, due to their ability to appreciate over time. If you’re not sure exactly how to invest in them, Kevin DeMeritt, founder and chairman of Lear Capital — which has successfully processed more than $1 billion in precious metal IRA-related transactions — outlines the steps that are involved below.

Why Physical Precious Metal Assets Can Be a Promising Option

Precious metals like gold and silver are only available in limited supply — which imbues them with a fundamental value that’s helped safeguard the assets from many of the economic fluctuations that have historically affected other investment vehicles.
As a result, gold and silver can often serve as a buffer in a portfolio, offering some protection when other investments are more volatile, according to Kevin DeMeritt.
“If you look at gold, it’s outproduced the stock market since 2000,” he says. “Gold usually has an inverse relationship to stocks and other types of assets. You need to look for an asset that’s going to give you stability and offset the volatility from some of the other areas.”
Despite various political, economic, and other upsets, silver and gold prices have, for the most part, increasedover the past two decades. In some instances, they’ve risen significantly, offering opportunities for favorable returns. The price of gold skyrocketed 147%in 1980, for example, and silver rose 557%.

Initiating a Physical Precious Metal Asset Investment

Funds from a number of retirement accounts can be rolled into a precious metal IRA, including a Roth, SEP or SIMPLE IRA; 401(k); 403(b); 457(b); a pension plan; or a Thrift Savings Plan account.
Investors can reallocate a portion of one of those accounts into a gold - or silver-based IRA by purchasing bars or coins. Lear recommends that you speak to your financial advisor to find the appropriate amount to diversify into precious metals. The items placed into a retirement account have to possess a certain fineness — for gold bars and rounds, at least 0.995, and for silver, 0.999, according to the Internal Revenue Service — to qualify.
Physical precious metal asset IRAs also involve another stipulation — the assets have to be stored in an IRS-approved depository. Lear Capital, for instance, arranges for investors’ assets to be held in a vault at the Delaware Depository, which backs its storage services with an extensive insurance policy — offering protection in the event of theft, fire, or flood.
“[To] continue to get the tax benefit of that retirement account, you cannot hold those metals yourself,” Kevin DeMeritt says. “Because the government needs to confirm that you actually have the metals or not.”
Lear Capital works with investors to help them with the storage and other steps involved in setting up a gold or silver IRA account. Lear pairs each person with a dedicated account team member, who can help make the process quick and easy.
There are two ways to transfer the money. In a direct trustee-to-trustee transfer, funds are moved from one IRA provider directly to a new precious metals IRA account.
A separate 60-day rollover method involves having your current IRA account provider mail a check to your home. You then mail the check directly to your new precious metals IRA provider. As long as it is given to the new IRA custodian and deposited into the new IRA account within 60 days, no taxes or penalties will be incurred.
“Simply give us a phone call,” Kevin DeMeritt says. “Talk with one of the representatives, [who] will get you the paperwork to transfer whatever portion of that IRA or 401(k) or 403(b) [you] would like [to roll] over to a physical precious metals IRA; you establish an account — we use Equity Trust, one of the largest self-directed IRA custodians in the country. It’s a pretty easy process.”
With a Lear Advantage IRA, investors can purchase precious metal assets totaling $5,000 or more.
“You don’t have to [roll over] your whole IRA,” Kevin DeMeritt says. “You transfer any portion that you feel comfortable with and we always recommend that you speak to your financial advisor to help determine what’s appropriate for you.”
“If you're 65, 70 years old, gold is not going to produce an interest payment or rent,” Kevin DeMeritt says. “But it could help you offset losses with the volatility in other assets.

Maintaining Physical Precious Metal Asset Investments

Once investors have set up a gold or silver IRA, they can monitor its performance through quarterly statements sent by the IRA custodian, or check its activity at any time with one of the company’s representatives. Lear Capital will also provide current information about their precious metals portfolio’s value on a monthly or quarterly basis.
“We’ll give them that day’s price,” Kevin DeMeritt says. “It’s not an estimate; it is exactly what they could sell at.
Based on their precious metals’ performance, investors may want to adjust their portfolio — which they can do at any time, according to Kevin DeMeritt.
“You can transfer more [funds] over [to add more gold or silver], or shrink [the amount of precious metals] down,” he says. “The price of metals goes up dramatically, and sometimes your percentage of precious metals, relative to other investments in your IRA, might look out of whack, and you want to sell some of it.”
If you’re interested in taking advantage of a specific purchase-back price Lear quotes you, the company will lock it in that day, so you know exactly what you’ll be paid. To make the exchange convenient, Lear Capital provides a shipping label, and the assets just need to be sent within five days; the company will then either wire or ship a check to you.
Typically, Kevin DeMeritt says, physical precious metal asset investors don’t do a lot of back-and-forth trading, based on gold and silver price checks; however they can, if they’d like to.
“Things come up in life for people - a college education, or some emergency, [and] they [may] need to sell sooner,” DeMeritt says. “You see that. But typically, we recommend a three - to five-year [investment period]. We've got clients that have been holding [precious metal assets] for 10 and 15 years - and [have] done very, very well.”
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Frazer Pugh

Frazer Pugh

Frazer Pugh is a distinguished expert in finance and business, boasting over 6 years of experience. Holding an MBA in Finance from Stanford University, Frazer's credentials underscore his authority and expertise in the field. With a successful track record in executive roles and as a published author of influential articles on financial strategy, his insights are both deep and practical. Beyond his professional life, Frazer is an avid traveler and culinary enthusiast, drawing inspiration from diverse cultures and cuisines. His commitment in delivering trustworthy analysis and actionable advice reflects his dedication to shaping the world of finance and business, making a significant impact through his work.
Emmanuella Shea

Emmanuella Shea

Emmanuella Shea is a distinguished finance and economics expert with over a decade of experience. She holds a Master's degree in Finance and Economics from Harvard University, specializing in financial analysis, investment management, and economic forecasting. Her authoritative insights and trustworthy advice have made her a highly sought-after advisor in the business world. Outside of her professional life, she enjoys exploring diverse cuisines, reading non-fiction literature, and embarking on invigorating hikes. Her passion for insightful analysis and reliable guidance is matched by her dedication to continuous learning and personal growth.
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