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Are Alternative Assets Suitable IRA Investments?

IRA Investments

Retirement investors often set up a Self-Directed Individual Retirement Account (SDIRA) to hold alternative investments. This type of IRA is advantageous for several reasons. It allows investors to diversify their assets and expand their allocations beyond stocks and bonds. SDIRA allows investors to mitigate risks in their portfolios by balancing traditional investments with other investment opportunities. These accounts provide greater control over a large number of assets and have the potential of giving higher yields and less volatility. Holding alternative assets also provides favorable tax adjustments. 

You can include several assets in a self-directed IRA, with gold and Bitcoin as attractive additions. Setting up gold and Bitcoin has its complexities. However, having one or both may secure retirement funds better than traditional assets.    

Gold As An Alternative IRA Asset 

Gold has become a common medium of exchange. Its value persists despite the use of market currencies. Gold often moves in the opposite direction of paper assets, such that investments in this precious metal serve as a hedge in case of economic downtimes. Gold as part of alternative assets in an IRA serves to equalize risks when included in a retirement portfolio. 

Including gold in a self-directed retirement account conforms to the IRS requirements regarding its form and purity. Gold needs to be at least 99.5% pure in Canadian Maple Leaf coins, Australian Koala bullion coins, PAMP Suisse bards, and American Eagle coins. Investors need to enlist the services of custodians, dealers, and depositories to purchase, manage, and store gold assets. They’d also need to consider setup, custodial, and storage fees associated with such investments.  

Setting up a gold IRA can also take the form of investments in exchange-traded funds (ETF) or mutual funds that track the prices and indexes of precious metals. ETF and mutual funds do not require the purchase and storage of actual gold assets, but they allow extensive exposure to the gold mining industry and associated stocks.  

Whether you intend to invest in gold bullions or gold mining company stocks, experts advise on moderate investments from 5% to 15% to maintain a balanced portfolio. While gold retains its value despite market crashes or political instability, its price still goes up and down. Often an increase in gold investment rates indicates a decline in paper assets and vice versa. Having gold in your portfolio can secure your assets against inflation.

Bitcoin: ‘Virtual Gold’ in an IRA 

Bitcoin IRA is a type of investment in digital currencies such as bitcoin, Ethereum, Litecoin, and bitcoin cash. Investors include these unconventional assets in an IRA due to its high volatility and potential gains, along with applicable tax savings. 

Bitcoin as an alternative IRA asset requires specialized custodians. Investors need to adhere to investment minimums of $3,000 for Bitcoin IRA and $20,000 for BitIRA. Cryptocurrency retirement accounts also require higher setup and maintenance fees that may impact future returns. To realize a Bitcoin IRA’s potential, investors should understand the risks involved in this type of unconventional investment. Partnering with a reputable custodian may help minimize the risks associated with cryptocurrency.

Bitcoin’s value has reached staggering growth rates in the past, proving its potential for higher gains in the future. Increasing attention and acceptance of bitcoin from companies and governments allows bitcoin to occupy a considerable financial sector position. As an alternative investment, its quality is comparable to gold, as it behaves differently from traditional assets. Bitcoin IRA can also serve as security from market fluctuations. 


Gold and bitcoin are becoming increasingly attractive additions to self-directed IRAs. These alternative assets not only diversify retirement portfolios, they can also provide wider investment opportunities. Gold investments can take the form of IRS-approved coins and bullions or gold ETFs and mutual funds. On the other hand, Bitcoin IRA includes various types of cryptocurrencies. As specialized forms of IRAs, gold and bitcoin often require custodians and third-party involvement when creating and managing these assets. They may also require minimum contributions and payment of setup and storage fees.

The volatility of these assets serves as the primary reason for including them as alternative investments. Prices of both gold and cryptocurrency behave contrary to traditional assets. Well-balanced portfolios that include gold or bitcoin in their mix act as hedges to compensate for losses and ensure gains. 

Aside from mitigating investment risk, both assets’ potential for future gains makes them useful additions to a portfolio. Gold maintains its value, while bitcoin and digital currencies can grow further with increasing acceptance from companies and government institutions. These characteristics of volatility, flexibility, and future gains make both gold and bitcoin suitable alternative IRA investments. 

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