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Silver IRA: Guide for Getting Started + 2022 Pros & Cons

Last Updated: September 25, 2022 by Mitt Wilson

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When it comes to investing in precious metals, you probably hear or read a lot about gold IRA options. While that's certainly a viable path to go down, it's not your only choice. Did you know you can also get a silver self-directed IRA?

How is a silver IRA different from a gold IRA? You still get all the IRA tax benefits, and your metals are still stored in a safe depository. The only real difference is that you primarily invest in silver instead of gold.

Is that worth it? It actually can be for many reasons. Gold might be more valuable ounce for ounce, but silver is actually rarer in terms of physical quantities. That drives up its value of it in terms of growth, so it's actually a great investment option.

In fact, silver has enjoyed double-digit growth in value most years over the last decade. While gold is still more valuable overall, silver is growing faster. A lot of that has to do with industrial applications and commercial demand fueling its rising prices on top of investor demand.

Do you need a silver IRA broker? This is a requirement, just like with a gold IRA. Fortunately, I can help you learn all about silver IRA options.

What Is a Silver Self-Directed IRA

Is the name something that sounds technical and confusing? If "silver self-directed IRA" is a mouthful, I'm here to help. It's as simple as breaking down the three parts so you can understand what this all is.

Silver simply means the physical precious metal. Sometimes, the word "silver" is used to describe vitamins for older generations, and I also know that some healthcare plans are listed as being that level versus bronze or something else. In this case, silver talks about the actual metal used in making mirrors, coins, and mythological difficulties for most vampires.

The self-directed part causes many investors anxiety, but it shouldn't. It just means you choose the particular silver products you want to be included in your account because this isn't a mutual fund where a financial manager is making the investment decisions for you. You won't go in blind, however, as every broker has a customer service team that can help you learn the products and choose the best ones.

The IRA part might be something you already know well if you're an investor already. A silver individual retirement account is another form of IRA. You can fund it several different ways, but your gains are tax-free while in the account, and you can enjoy tax benefits when you make withdrawals.

The IRS does require you to use a broker for these accounts, and they have to be brokers from the precious metals industry. I'll get to that a bit more later about choosing one. There are many trustworthy options you can turn to.

You'll also have to let a secure depository hold your metals while in the account. This is another IRS requirement. If you want the metals in your own personal possession, you'll have to wait until your withdrawal windows open up.

If you pull anything out of the account before age 59 1/2, then you're going to lose wealth due to taxes and early withdrawal penalties. However, if you wait until your retirement years, then you'll enjoy serious tax benefits on top of the historically steady growth in the value of silver. That preserves your wealth and grows it.

The biggest benefit is portfolio diversification. Silver, like gold, usually does well when the stock market isn't.

That means you should always have something growing.

Is a Silver Individual Retirement Account a Good Investment?

For the most part, I think that investing in precious metals is a good investment. Gold, silver, platinum, and palladium all offer relatively similar benefits. Silver in particular is starting to gain more attention in some quarters lately due to having double-digit growth for more years than gold.

However, it's not enough to just invest in silver. You need to use the IRA format to get the most benefit. Silver should help you preserve wealth and grow in value, but the tax benefits of an IRA account compound those advantages.

Any gains silver makes in value while in your self-directed IRA won't be taxed while the account is active. If you wait until age 59 1/2 or later, then your taxes on distributions or withdrawals should be lower than normal transactions. In some cases, you might not pay taxes at all.

The important thing is to diversify your portfolio properly. While I believe that silver is valuable, you don't want to do just precious metals. Diversification doesn't mean spreading your entire portfolio among two, three, or four precious metals but instead using three or four different asset classes.

Stocks and bonds are two closely related asset classes that should still comprise most of your portfolio. Real estate is another asset class that you might want to look into. Other potential asset classes might include commodities and cryptocurrencies.

Precious metals, such as silver, should be in your mix, but don't overdo it. Anything less than 5% isn't likely to help your portfolio, but anything more than 15% might be missing out on the growth, yield, and dividend opportunities available in other asset classes. I am here to advocate for a portion of your portfolio, but a qualified financial advisor or planner is who can best help you decide your particular mix of assets.

How Do I Open a Silver IRA?

Pick a qualified broker

The first thing you will want to do when setting up your Silver IRA is finding a precious metals company that can help get you started. We have many recommended precious metals dealers reviewed here on the site.

Fund Your Account

Once you've chosen a Precious Metals IRA company to work with, you can begin the process of funding your account. IRA or 401k rollovers are two of the more popular options.

Buy Silver

Once your account is funded you can use your self directed Gold and Silver IRA to begin purchasing your precious metals.

1. Pick a Broker

Opening a silver individual retirement account is usually pretty easy when you choose the right precious metal IRA broker. After deciding to invest in a silver account, your choice of broker is probably your second decision. If you're not sure where to start on that, I offer a comparison of three great companies later in this content.

2. Fund Your Account

Once you do pick a broker, you'll need to contact them to create an account with them. It's possible you might already have one if you've done a gold IRA and are now looking to add a silver account with them as well. In that case, you might not have as much work to go through.

Setting up an account is easy with most brokers. Many will let you do it online or via their website. Some will only do it over the phone, however.

When your account is created, you need to decide three things:

  1. The first is how much to invest
  2. The  second is how to fund the account
  3. The third is what kind of silver products to put in it. 

How much you invest will have to meet the minimum requirements of the particular broker that you decide on.

How much should you put in more than the minimum? 

That depends on your total portfolio size, how much exposure you want to silver, and how far along you are in your investing. I'd suggest between 5% and 15% of your total portfolio because if you do more than that, you might disrupt the diversification and growth you are getting in other asset classes.

How you fund the account can be one of the biggest decisions. You can do it with post-tax income, but you'll be passing up a crucial opportunity. Doing a rollover from a previous retirement investment account lets you keep your pre-tax contributions and their untaxed gains intact in silver form.

3. Buy Silver and Other Precious Metals

In regards to what kinds of silver products you put into the account, you'll be restricted by IRS eligibility rules and what the broker has available. Certain coins might have their value rise because they are both made of silver but also for aesthetic, collectible, and stylistic values as status symbols. On the other hand, bullion is usually easier to acquire and liquidate when the account is finished.

Once you decide on your purchases, you'll choose from among the available depositories your broker has available for storage. You might have the option for segregated storage that keeps your silver metals away from everyone else's, and non-segregated storage is sometimes available for a lower rate but is still highly organized. Some depositories only do one or the other and would not present you with a choice

Silver IRA Pros & Cons

A silver individual retirement account can be a powerful investment tool, but it's not automatically the right move for every investor. At the least, you would hope you align with more of the pros than the cons. However, you still need to judge for yourself if it's something that would prove valuable to you, as I can only help you get to know the potential benefits and drawbacks.

Pros
  • There are lots of silver products available that gold investors might pass over
  • Silver's growth rate has been doing better than gold in the last decade
  • The value of silver is fueled not just by investors but also by industrial applications and aesthetic uses
  • Silver is a physical asset that retains value better than paper assets
  • You can use silver as a hedge against inflation
  • Silver is easy to liquidate when you have to make withdrawals or distributions
  • You can still usually invest in gold, platinum, and palladium in silver accounts
  • Silver can anchor your portfolio value in times of economic recession or turbulence
Cons
  • Annual account and custodial fees can eat into your gains and wealth
  • You have to use a depository in lieu of taking personal possession per IRS requirements
  • Minimum investment levels apply to most brokers
  • Silver isn't as valuable per ounce as gold is
  • There's no guarantee that values will rise in the future or outpace other investment classes
  • You have to wait for a certain age for penalty-free withdrawals if you need money sooner

Recommended Companies Offering Silver Individual Retirement Accounts

It was specific legislation of Congress and implementation by the IRS that allowed precious metal IRAs to start in the first place. 

That does open up the tax advantages inherent to such accounts, but it also means that certain rules have to be followed.

A big part of that is choosing a precious metal IRA broker to administrate your account and have them arrange for a secure depository to take custodial care of your metals until you make withdrawals.

YOU MAY ALSO LIKE: Should You Purchase Silver or Gold?

It would take me all day to even cover or mention every precious metal broker in the business. 

For the time being, I'm going to mention three of the best companies that you can start your considerations with.

That at least gives you a starting point to move on from if you want to look into others.


1. Goldco

Top Choice for Gold IRAs
goldco
9.8/10Our Score

Goldco has earned some of the highest marks across the industry for customer service and integrity, including an A+ Rating from the Better Business Bureau.

  • A+ Better Business Bureau Rating
  • AAA Rating via Business Consumer Alliance
  • Up to $10,000 in Free Silver with Qualifying Purchase
  • Easy 3-Step Process to Get Started

"The crew at GoldCo are professional and accommodating, extremely helpful and very easy to work with. My service rep, Tony Pino, was always available and willing to answer/explian any questions. Highly recommend them." -Mark G.

Goldco is one of the oldest precious metal brokers in the business. Many industry analysts place them in the top handful of companies. A good number of analysts even list them as the best of all options.

There's one reason for that and one reason only. Their commitment to customer service is unrivaled.

They set the standard everyone else is compared to.

Look over their reviews, and you'll hundreds of satisfied clients. That's not just now, as it also goes back many years. From the Better Business Bureau and the Business Consumer Alliance to Google and TrustLink.

They are excellent at customer service to anyone trying to start an account. That includes the silver self-directed accounts they offer. Opening one up with them is easy.

That customer service continues while you have an account with them. They'll help you choose great products to put into your account. You'll also be kept current with market developments and new opportunities to invest.

When it comes time to close your account or make withdrawals, you'll get treated with white gloves again. They'll easily ship you your metals. They might also offer to buy them back so you can liquidate them without ever having to take personal responsibility for your metals.

Goldco silver individual retirement accounts can include gold, platinum, and palladium products even if the focus is on silver. You need a minimum of $25,000 to get started. Funding via a rollover is possible from other IRA and 401(k) accounts.

2. Augusta Precious Metals

Augusta Precious Metals
apm
9.8/10Our Score

Augusta Precious Metals has some of the highest marks across the industry for customer service and integrity. 

  • A+ Rating and Zero Complaints Registered with Better Business Bureau 
  • No High-Pressure Sales Tactics
  • Welcome Webinar from Harvard-Trained Economist
  • Simple 3-Step Process to Get Started

"I diversified my retirement with precious metals from Augusta. You can count on them."-Joe Montana, Hall of Fame Quarterback

For as much as Goldco focuses on customer service, Augusta Precious Metals emphasizes client education. Nearly any precious metal broker offers some form of industry education to clients via website resources. Augusta takes it a step further.

This broker has an entire department focused on client education. They regularly post industry updates and opportunities on their website. However, they are also active in doing guest posting to other blogs, participating in podcasts, and engaging clients through social media.

The one big and unique perk to Augusta is that every client eventually gets a personal meeting with their lead analyst. This is a chance to talk directly to someone trained in business at Harvard about investing in precious metals. It's a rare opportunity that I'm not sure any other broker offers.

The customer education department is actually totally different than the customer service department. However, both of them will treat you really well as a client. Augusta streamlines its operations to keep overhead down.

The first benefit of that is that you'll have an efficient and quick experience anytime you deal with either department. It also means they keep their costs down, and they pass those savings on to you as a customer. Some brokers will have hidden fees that you don't find out about until after your initial quote, but Augusta doesn't pull this.

Trust and transparency are rare features to many businesses, but Augusta Precious Metals believes in both. They want to help you learn all about precious metal investing. They also want to gain your trust just as much as get your business.

Augusta's commitment to client education is stronger than maybe anyone else, and its customer service is still among the best in the business. However, you need $50,000 as a minimum to invest in a precious metal IRA with them, be it silver or gold. That's a high entry level and one of the highest in the sector.

Learn more and get Augusta's Free Investing Kit

3. Regal Assets

Regal Assets
regal assets 1
9.5/10Our Score
  • The first year of fees can be waived
  • Customer satisfaction rate better than 98%
  • Broad variety of different bullion products
  • Free investing kits
  • BBB rating of A+ for the customer service
  • $25,000 minimum investment for an IRA
  • A younger industry member

Regal Assets is a relatively newer name in the industry. However, they bring some things to the table that help them make a name for themselves. I'm curious to see just how good this company will be over time with the three things they offer.

First, Regal Assets has worked hard to become the rollover specialists in the industry. Any broker should be able to take funds from other IRA accounts, as well as 401(k), 403(b), and TSP plans, and fund your silver account with them. However, the professionals at Regal really know what they're doing.

That's important. A rollover done wrong can actually reduce your wealth by triggering penalties, taxes, and fees. However, a rollover done right can preserve the tax-free or tax-deferred status of your current investment wealth and let it keep growing to the utmost potential.

Second, Regal Assets lets you invest in precious metals, such as silver, and cryptocurrencies at the same time. Both are considered alternative asset classes compared to stocks and bonds. Either one of them helps you diversify your portfolio, but doing both is even more diversification.

As a precious metal analyst, I'm not in a position to tell you whether or not investing in cryptocurrencies is a good idea or not. You've likely heard just as much as I have about the potential but also the volatility and risk. However, if you want some minimal exposure to that class while also opening your portfolio up to silver precious metal pieces at the same time, then Regal Assets makes that a possibility.

Third, their minimum investment level is only $5,000 for many precious metal accounts. That's one of the lowest minimums in the industry. It's obviously far easier to manage than Goldco or Augusta.

Everyone needs to invest for the future, and a lower minimum makes that a lot more possible. It also makes it easier to diversify your portfolio into precious metals. Having at least some exposure to this alternative asset class is something any investor should get to benefit from.

Learn more and get Regal Assets free investing kit

Summary


Investing in a silver self-directed IRA can have a lot of the same benefits that a gold IRA has.

You can choose to use one in place of your gold IRA. Alternatively, if you have enough funds, then you can possibly invest in both.

Silver will provide you with similar benefits to gold as a metal. It will work well as a hedge against inflation.


You can also rely on it to anchor your portfolio value in times of economic distress, which can be a nice safety blanket the closer you get to retirement.

The growth aspect of silver might actually be a little more attractive than gold. It's grown in value faster than gold in recent years.


That trend might continue since silver has many industrial, medical, electrical, chemical, technological, and commercial applications all pressuring prices upward.

You'll need a broker for your silver individual retirement account.


Goldco offers silver accounts, and their customer service is usually a safe bet. Augusta Precious Metals is a solid choice if you want access to some of the best customer educational resources in the industry, and Regal Assets is one of the best options around if you decide to fund a silver individual retirement account via a rollover.

Mitt Wilson

About the author

Mitt Wilson has a background in journalism and has been writing about investing for more than two decades. In his free time he enjoys spending time with his wife, touring the United States, and golfing.

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