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How to Execute a 401(k) to a Gold IRA Rollover

Written by Peter Wilt

In today's economy, hedging against inflation is a vital step in maintaining the value of your retirement account; on this page I break down how to do so by rolling over your 401(k) into a gold IRA.

Precious metals allow you to hedge against both inflation and economic uncertainty, so including them in your retirement plan is a smart move.

Many people have a traditional retirement account with the thought that it’s more than enough to get them by- 20 years ago maybe, but in this economy, the value of our currency is falling fast. 

Below we break down how to convert your 401k into a gold IRA without being penalized. It’s a relatively simple process if you invest with a reputable company who does the work for you. 

Some of the links in this article are from sponsors. The list below is an honest review gathered from thorough research, experience, and consumer-based feedback.

Benefits of Opening a Gold IRA

How to Execute a Rollover into a Gold IRA

You're thinking you want to convert your money from your 401(k) to a Gold IRA. There are a few steps that you must take to achieve your goal:

First, you will need to choose a self-directed IRA custodian to oversee the account. 

Second, you will need to open an account so that the precious metals can be purchased and maintained in a regulated area. 

Lastly, you will have to process the rollover of the funds so that the broker and custodian can acquire the metals on your behalf. 

The process may seem cumbersome, but here is a breakdown of each step and how to ensure you get the best results at the end:

401K to Gold IRA Rollover Guide:

Step 1. Identify Your Self Directed IRA Custodian

The first thing you need to do is figure out the person who will be the administrator or custodian of the Gold IRA. It is actually illegal for a person to keep the gold themselves.

This is typically a company that will keep records of all transactions and provides documentation and services that are for you and the IRS.

Their job is to orchestrate the buying and selling of the precious metals that you choose to invest in and perform all these transactions on behalf of the account owner.

 Many investment companies are not able to hold physical investments with their IRA accounts. These are mostly Wall Street firms, which want you to invest your money in stocks and bonds to help add to the money market. 

When you choose to open a Gold IRA account, make sure that the firm you are choosing to invest with is specifically set up to allow a “self-directed” IRA.

This indicates that the account owner is taking personal control of their assets within the IRA and are not relying on the services of the company. For more information on these steps, we suggest contacting Augusta for a walk through of the process, even if you don't plan to invest with them.

Step 2. Open Your Account

Now that you know who is going to manage the account, you need to open it for them to begin their work. The custodian will need to reach out to a metal broker or metal dealer to help with the purchasing and selling of the gold or other precious metals that you choose to invest in.

Once they have located the items, they will work with the custodian to broker the deal and get the items transferred to where the custodian will assign them to be kept.

Then, the amount will be recorded, and the documentation is sent to the account owner and the IRS for their records. 

 You can open a Gold IRA with any amount of money depending on who you work with.

Sometimes no minimum has to be used to create it, but most companies require that you at the bare minimum invest enough to purchase a complete unit of the precious metal to avoid having to have the metal melted down and transformed into smaller amounts. 

Other companies on the other hand will not work with anything less than $5,000 - $50,000.

Anytime this is performed, there is a risk of the metal being damaged or losing its “purified” status. When you choose to invest, make sure to have the full amount to add better security to your investment. 

Step 3. Execute the Rollover

The next thing you need to do is figure out how you will roll over the money. There are two different ways to do it: direct and indirect.

A direct rollover describes moving the money by directly transferring from the account to the IRA trustee. 

This takes a lot of the paperwork and legal matters out of the hands of the person who is opening the account as the receiving company will help with setting everything up. 

Indirect rollovers are more complicated as the funds of the 401(k) are given directly to the owner of the account with the intention of them transferring them into a Gold IRA and not keeping the funds as a distribution. 

There will be more paperwork on the part of the account owner to prove that this was done, and that can make using the direct rollover method more appealing. 

How to Move your 401k to Gold Without Penalty:

To transfer your 401(k) to gold without penalty, you need to set up a self-directed IRA Account with a precious metals Trustee. Then, you do a Trustee to Trustee transfer from the original 401(k) account to the new Self-Directed IRA account, all within less than 60 days.  

If you take longer than 60 days, the funds will be considered a “distribution of funds” from the 401(k), and be liable to any taxes of such a transfer. 

Step 4. Purchase Gold

Eligible Accounts

The money that you use to fund your Gold IRA can come from several sources.

You can withdraw funds from a Traditional IRA, ROTH IRA, SEP IRA, SIMPLE IRA, and a few other eligible accounts, like a 401(k), 403(b), 457, and federal Thrift Savings Plans. 

If the funds are being transferred from a ROTH IRA, have the Gold IRA set up as a ROTH IRA as well. This way you can preserve the tax benefits of a ROTH IRA, including the tax-free growth, provided that the funds remain in the ROTH account for no less than five years. 

Why Would You Execute a 401k to Gold IRA Rollover?

A 401(k) is a retirement account that is meant to use the stock market to invest your funds in hopes that they will grow as the stock market grows too.

This is common way people attempt to increase their investment.

However, though popular, having a standard 401(k) does come with some risks.

As the stock market rises and falls, so too does the money endowed into it. 

We have seen in the past when the market becomes unstable and takes a deep plunge, so too will your money with no way to recuperate what was lost until the market restores itself.

This knowledge may cause a person to pull what money they have from their 401(k) for fear of instability, but there is an alternate form of investment that could give you better security.

Most people are not aware of this as it is typically something reserved for those who are more financially savvy and spend their time learning the ins and outs of investing.

Yet, here we will discuss with you how to take your hard-earned money and turn it into a concrete investment in the one currency that is truly universal: Gold.

What is a Gold-Backed IRA? 

A Gold IRA is a type of individual retirement account (IRA) that allows its owner to invest their funds in gold as a form of qualified retirement investment.

Though it is titled a “Gold IRA”, the precious metals available for this kind of account range from platinum, palladium, gold, or silver. Whatever kind of metal you choose to invest in, these metals come from national, NYMEX or COMEX certified mints where they have been processed for purification and have been verified to meet the standards of the metal trade.

These investments are physical metals in the forms of coins, rounds, or bullions, which are bars or ingots of pure precious metals that have been assessed and are officially recognized as being 99.5% to 99.9% pure by the governments and central banks. 

 A Gold IRA is not kept in a traditional retirement account as it does involve physical investments as opposed to the digital bookkeeping that is used for funds invested in the stock market.

There are also more rules on the management of the account and how the physical pieces are to be maintained to keep their integrity intact.

The previous metals must be kept in a safe place with a custodian who will oversee their care.

There must also be a broker involved to obtain the metals and to have them transferred between buyer and seller.

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Advantages and Disadvantages of a Gold-Backed IRA


The biggest advantage to having a Gold IRA account instead of a standard 401(k) can be summarized by a single word: Control.

You won't be subject to market changes, inflation, and the political climate with a precious metals IRA. 

Make sure to research the different precious metal companies to ensure you put your money in reliable hands.

We recommend Augusta Precious Metals for those investing over $50,000.

You also will have control over fees as most major brokers are now charging no fees for rolling over your 401k into a precious metal IRA. 

If you choose to use an automated advisor to manage your portfolio, there is a tendency to have a small percentage fee for each transaction, but that can usually be reduced. 

It is advised that you don’t take money from a retirement plan earlier than need be, but it is easier to get funds from an IRA than it is from an employer-sponsored plan.


With the advantages come the disadvantages of having a Gold IRA. 

Retirement savings plans try very hard to discourage their contributors from withdrawing money before you reach 59 ½.

The typical rate for doing this is a 10% penalty.

When it comes to 401(k) plans, these can be waived on early withdrawals that are taken out as early as 55 years old, but this exemption is not available for IRAs.

The biggest disadvantage is the trouble that can be caused by moving your funds from a 401(k) to a Gold IRA if you have not educated yourself on how to do so without getting penalized.

More Benefits of Rolling Over Your 401(k) Into a Gold or Precious Metals IRA:

What is a Gold IRA Rollover?

A Gold IRA rollover is moving a retirement account into an IRA that's backed by physical precious metals or Gold ETFs. You can take a look and the differences between gold mutual funds and ETFs here.

Can You Rollover a 401k into a Gold IRA?

Yes, you can roll over any retirement account in a Gold IRA. 

Our 401(k) to Gold IRA rollover guide is explained here.

How Long Does it Take for a 401k to Gold IRA Rollover?

A 401k rollover into a Gold IRA takes about 60 days to complete, and definitely no more than that. Should you take longer than 60 days, you will be subject to taxes on your money.

After you complete the rollover, your precious metals will be stored in a secure gold IRA depository

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  • Making Your Final Decision- Is a Gold IRA Rollover Right for You?

    For those who are considering making this financial move, there are many different companies that you can reach out to for further information and to help you with the process.

    Typically, the custodian you assign to your account will have a list of who they have worked with in the past and who will be best to help you make this goal a reality.

    If you haven’t found someone yet, consider going with Augusta Precious Metals.

    They are a long-standing, highly respected company that has had decades of experience in the gold and precious metal trades.

    They have helped people, from the most financially savvy to the beginning novice, to realize their goals of investment stability by purchasing real metals. The testimonials from their customers make them one of the most trustworthy resources.

    In Conclusion

    Should You Rollover Your Savings into a Gold IRA? 

    Rolling over 401(k) funds into a precious metals IRA and investing in gold has become a popular move for people who are investing in their retirement.


    Most plans are created with the ability to be portable, and an IRA is the most portable of them all.

    There are so many more choices that you can have.

     You have different choices for the account owner, the type of investing that will be done, and even the fees that will be paid for the maintenance of the account.

    This is the biggest advantage of having this level of flexibility. 

    Augusta Precious Metals

    Augusta is the leading provider of Gold and other precious metal IRAs. They offer exceptional customer service and diversification options for their clients.

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