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How to buy Gold and Silver when money is...

4K views 24 replies 13 participants last post by  albertjohnson 
#1 ·
in a 401K? I do not have access to cash to buy gold or silver bullion, I have a good amount of money in 401K's....I don't want to get hit with the penalty of early withdrawal from my 401Ks.

I'm thinking about buying into some gold and silver ETF's but am not sure of this being a good position to be in IF the SHTF scenario...I wouldn't have direct access to the bullion so when or if the markets tank I could just say I got useless paper.

Any suggestions on how to proceed on trying to protect my savings???:confused:
 
#2 ·
i had 3 accts that i closed down. in the end i figured id have to wait 25 years before i can withdrawl on it and as for the costs associated with it, the company match covered it all and theres really no principal lost unless you made bad investment choices. for me its a no brainer, give them back the matching contribution
 
#5 ·
Since no one else has done it, I'll take the antagonist position.

Keep in mind that PMs do not pay dividends, grow/acquire assets, or serve as a (decent) hedge against inflation. They are for preserving some of your wealth in the event of a currency collapse or minor (aka no asteroids or zombies) SHTF. While I believe that you should definitely hold PMs, cannibalizing your retirement savings to do so is, to my mind, not the best plan.
 
#6 ·
. . . Keep in mind that PMs do not pay dividends, grow/acquire assets, or serve as a (decent) hedge against inflation. . .
In 1913, 100 years ago, the ave cost of a new home was $3,395 - http://www.911omissionreport.com/prices.html

If you had the cash you could have paid for it with paper money or circulating gold coins like this $10 US coin.::



You can not buy an average new home with those same $3,395 dollars today, BUT you can still buy a new home with those same $3,395 gold coins now worth $247,156 (price APMEX will charge you for those coins today). Those 339.5 gold coins were more than a decent hedge against inflation and held up a "little better" than the paper money.

http://www.apmex.com/product/23203/10-indian-gold-eagle-cleaned
 
#7 ·
in a 401K? I do not have access to cash to buy gold or silver bullion, I have a good amount of money in 401K's....I don't want to get hit with the penalty of early withdrawal from my 401Ks.

I'm thinking about buying into some gold and silver ETF's but am not sure of this being a good position to be in IF the SHTF scenario...I wouldn't have direct access to the bullion so when or if the markets tank I could just say I got useless paper.

Any suggestions on how to proceed on trying to protect my savings???:confused:
Hard PMs, in hand.

Paper metal is . . . paper, and protects nothing.

You say you don't have the money to buy gold & silver, yet are thinking about buying paper gold & silver? Reduce the 401k contribution you were going to put into paper metal and take that money out of your paycheck to your local coin dealer.
 
#9 ·
This is a gold/PM discussion. My reply was to a statement that gold was not an inflation hedge.

I can pick just as many stocks in 1913 that that would have lost all your money. What precious metal did that?

I own stocks and PMs, they are both part of a well balanced portfolio, which is what we are talking about. They do different things and both are needed, especially today . . .

http://www.usdebtclock.org/
 
#14 ·
I just want to footstomp something again here. I'm not anti-PMs, I own PMs and encourage others to do the same. I'm not even saying that they're not an inflation hedge, because they are. But they're not the BEST inflation hedge (to my mind anyways) due to their volatility.

If this was a thread about "should I buy PMs with part of my paycheck" I would be less vociferous, but it's not. OP wants to put part of his retirement money into a single item that is likely to experience a downturn in the years ahead, while also establishing that he does not have an income stream enabling him to buy PMs otherwise. I do not want to see him eating Alpo because he was encouraged to make a suboptimal choice here.

EDIT: Bonds aren't a safe haven anymore due to the Fed's manipulations and distortions, stocks have been pumped to hell and gone thanks to QE, gold ... see above, silver is volatile as all getout, REITs might be positioned to get hosed by any increase in rates (not sure how it would effect equity REITs though), and Obamacare plus fun federal regulation make it a royal pain to start your own business. (Plus there is always a large startup cost, even for a simple franchise.) I do not know what is a 'safe' sector, I am only attempting to state that gold is not the best of a bad bunch right now.
 
#17 ·
Thanks everyone for the input...Some very good points all around.

I believe the best approach, as I am one that believes a stock market correction or even worse US Dollar loses the world currency designation or BOTH. I want to have PM's just in case.

I will lower my contributions to my 401K, if not stop it completely and put that money towards PMs.

Again, thanks for all the replies, I just couldn't stomach the 28% on top of the 10% penalty to cash out the 401Ks, but really if the markets crash then it'll be worse than the 38% I looking at losing.
 
#19 ·
Joe

You can always take up to 50% or $50K? out from your 401K at any time in the form of a loan to yourself with no penalty (You will pay yourself back at 4-5% interest.

If you do this in essence you are betting that Pm's will go up in price and mutual funds will go down in price. From an investors standpoint this is sometimes prudent.

Another good thing about it, is that if you do take a loan from your 401K and then the market corrects you will be replacing those mutual funds at a lower rate.

I see absolutely no problem in folks using their 401K's as "loans"...it's a hell of a lot better deal then using a bank for anything. If folks have a 401K and can take a loan from it I feel they are crazy for holding debt outside of anything other than a house.

Case in point: If you have $5K worth of credit card debt at 10-20% and a 401K that you can get a $5K loan from then why not take the loan from it and pay off your debt? It's all about percentage points on interest. Now anything less than 3-5% financed can be neutral.

Again, you can loan yourself money from your 401K with pretty much no tax ramifications...but you do have to pay YOURSELF back.

EDIT/ADD - What is stupid is when folks take a loan from their 401K and "blow" the money.
 
#20 ·
I'm surprised by the responses here. Personally given recent Supreme Court rulings that the Govt can impose any Penalty it wishes as long as said Penalty is in the form of a tax, I don't see "adequate" by our standards 401K's not being taxed into oblivion to spread the wealth. We are forced to pay Social Security that the Govt ran into the ground knowing full well we will never recieve it. Then I have to pay a 10% penalty to remove my money from my "retirement account"?!
If any of you really think that there is any future in those accounts, I truly wish you the best. Personally I am enjoying what amounts to retirement at 33. I own new vehicles, no debt, and will have my 11 acre homestead paid off in 7 years.. Should I choose to... Otherwise I could cash in my PM's and pay it off now.
Cashing out all of my retirement accounts was a fantastic choice for me. I know work only for luxury money.
Following the bait that this country has been dragging along is no recipe for independence.
Property, gold, silver, CASH RESERVES, and lots of ammo and training. I know not everyone can do it, but I encourage you to try. Think outside the box.
 
#21 ·
When, not if, the stock market crashes again, do you think it'll only go down 10%? Take the hit/penalty now on SOME of your 401 and put it in sliver, the real thing in YOUR possession. You decide how much based on how much you have in there and based on your age.
All the stock holding boys are going to get creamed. . . again, when it goes.
 
#22 ·
What about holding CEF in your 401k?

I have a good portion of my 401k in CEF.

Had I to do it again, I would have just left it all in the money market portion, and withdraw it. I'm unemployed now. There's only about $16k in there.

My company had a 50% vested match, so I'm still in the green with what I put in there.
 
#23 ·
Do you take a hit on your CEF for withdrawal? How much? (CEF is just another form of paper, like stocks, mutual funds)
You were already matched with 50%? So a 10% hit wouldn't hurt that much.
Man, I, like many on here, don't want ANY in paper. (stocks, funds, CEF's) If it were me, and this is just me, but I'd take it all out and put in the real thing, in my private possession. You'll sleep better, believe me. On 2nd thought, I'd put 30 to 50% in cash at home and the rest in the real thing.
 
#24 ·
See, I thought CEF was better than SLV, because it's a mix of gold and silver, and it seemed like they actually keep the bullion there. But I know little about how this stuff works.

The investment policy set by the Board of Directors requires Central Fund to
maintain a minimum of 90% of its net assets in gold and silver bullion of which at
least 85% must be in physical form. On October 31, 2013, 99.2% of Central Fund's
net assets were held in gold and silver bullion. Of this bullion, 99.6% was in
physical form and 0.4% was in certificate form.


Central Fund's physical gold and silver bullion holdings may not be loaned,
subjected to options or otherwise encumbered in any way.


Central Fund’s bullion is stored on an allocated and fully segregated basis in
underground vaults located in Canada which are controlled by the Canadian
Imperial Bank of Commerce (the “Bank”), one of the major Canadian banks.

The Bank may only release any portion of Central Fund’s physical bullion holdings
upon receipt of an authorizing resolution of Central Fund's Board of Directors.

Bullion holdings and Bank vault security are inspected twice annually by Directors
and/or Officers of Central Fund. On every occasion, inspections are required to be
performed in the presence of both Central Fund's external auditors and Bank
personnel.
From http://www.centralfund.com/annualreport/annualreport 2013 with MDA.pdf

I would take a 10% penalty, but even with that I'm still ahead. After taxes and penalties and losses, I'll get at least what I actually contributed, plus a little more. I keep wanting to keep it in CEF so that if it rises, I can at least not take a loss. But if it goes down more, I'll lose some of what I actually invested, rather than just a portion of what my company matched.
 
#25 ·
There are rumors going around, probably on good authority, that for every 10 oz of PMs supposedly owned, there are really only 1 oz to back it up. Some estimates are at 30:1, 50:1 and higher: ( here's a thread on that: http://www.survivalistboards.com/showthread.php?t=337018 )
A freakin' Ponzi scheme on PMs themselves! So again, only what you have in YOUR possession are really owned when TSHTF.
Did you hear Germany wanted back what they were owed in Gld? Wonder why? They were only given a fractional %, I don't know how much, back, certainly not close to 100% or even 50%.
A bunch of promises by 'so called experts, Banks, Boards of Directors, Officers, Directors smacks of another con, e.g. Ponzi scheme to me. The more they try to make you THINK something's safe, the more I am wary.
:cool: UNDERGROUND vaults. . . uh huhhhh. This is one very old con. :taped:
I used to live in Phx...there was a 'private' vault built into the side of a mountain and they kept 'safely' your money, valuables, etc. and only YOU had the key that could open your box. One weekend, the owners of the place opened ALL the boxes from back doors and absconded with everything and disappeared. FWIW

i'm not affiliated with them, but have bought from them...they have 1 oz sliver rounds for $1.04 over spot. . . and after this thread, i think i'll buy some more. (my food/water requirements are taken care of) http://www.coin-rare.com/silver-rounds.aspx
 
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