Purchasing physical gold is a popular way to diversify investments and protect wealth in the event of inflation or an economic crisis. However, you need to put careful thought into how you store your gold. You don’t want to lose it or have it stolen.
When it comes to storage for physical gold, you have three main options: in a vault, in a bank, or at home. Each has pros and cons, and some storage may not be suitable for certain types of gold. In this guide, we will walk through each one to help you make the best choice for your situation.
In this guide:
Gold storage in a vault
Gold vault storage is one of the simplest ways to protect your gold. Just select a trusted depository, and ship your gold to it. The depository will secure and insure your precious metal until you’re ready to sell or withdraw it.
What you should know about this method
Using a vault for storage is ideal for those who own a large amount of gold or who don’t want to hassle with other gold storage options. It’s also the only IRS-approved way to store physical gold in an individual retirement account (IRA).
Kyle Ryan, CFP®, advises: “Investors who don’t want to purchase physical gold can gain exposure to the price of gold via investments within their accounts (for example, buying shares of gold miners’ stocks or exchange-traded funds ETFs tracking the price of gold).”
You can find precious metals depositories across the country and the world. Popular options in the U.S. include:
- Delaware Depository
- Brinks
- Texas Precious Metals Depository
- International Depository Services
Each depository has a unique fee structure, and most offer the option of commingling your gold with other precious metals stored onsite or using segregated and allocated storage.
Commingling is less expensive, but it may mean when you make a withdrawal, you won’t get the exact pieces of gold you deposited.
Before selecting a depository, check the following:
- Security: How does the depository protect your physical gold?
- Insurance: What sort of insurance or liability coverage does the company maintain?
- Accounting: How does the depository maintain records? Does it keep your gold off its balance sheet and titled in your name?
- Access: Is there a way to track or otherwise manage your gold while it’s at the depository?
- Fees: Be aware of any hidden fees, which can lower your return over time.
Pros and cons of this method
Using a vault for gold storage can be beneficial for several reasons. However, it’s wise to consider the drawbacks too.
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Provides a level of security and insurance that may be difficult to replicate at home or at a bank. -
Hands-off storage method, with many gold companies willing to ship to depositories. -
IRS-approved method for storing precious metals for a gold IRA.
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Depending on the depository you choose, annual fees could range from the hundreds to thousands of dollars. -
Direct access to your gold is not often possible, and it may take several days to receive withdrawals. -
If gold is commingled and unallocated, you’ll receive comparable gold when making a withdrawal, but it may not be the exact item you deposited.
Gold storage at the bank
A safe-deposit box at a bank offers several of the same benefits as using a vault, but it’s less expensive. It also allows you to access your gold during banking hours.
What you should know about this method
Not all banks offer safe-deposit boxes, but those that do may have several sizes available. Average annual prices can range from $20 or $30 for a small box to several hundred dollars for one that’s 10 inches by 10 inches.
Once you sign an agreement for a safe-deposit box, you’ll get the sole set of keys. So bank staff can’t access the contents, and if you lose your key, you must pay a drilling fee to have the box opened.
Before using a safe-deposit box, consider these factors:
- Insurance: Items in a safe-deposit box are not FDIC-insured, so you must buy your own insurance.
- Access: Confirm what hours you can access a safe-deposit box in case they don’t correspond to regular banking hours.
- Security: What identification or documentation does the bank require to ensure no unauthorized person can get access to your box?
Kyle Ryan, CFP®, offers this advice for those storing gold at the bank: “Make sure you properly document where you store your gold and how to access it in your will or something similar. Beneficiaries or heirs will need to know it exists and how to access it if you pass away.”
Pros and cons of this method
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Select a convenient location near your home. -
Storage fees are much lower than those for vault storage. -
Bank-level security for your gold.
You might want to use a bank for gold storage for several reasons.
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Boxes can be small, making them impractical to store large amounts of gold. -
Access limited to banking hours. -
Must purchase insurance to protect your investment.
Using a safe-deposit box also has drawbacks.
Gold storage at home
Keeping your gold at home is an option too. Many people like knowing that they have control of their gold at all times and can access it whenever they want.
What you should know about this method
Storing gold at home would seem simple, but there’s more to it than buying a safe. Unlike a vault or bank, your home likely doesn’t have the same level of climate control or security. You must also consider insurance.
If you want to store your gold at home, these are crucial factors to consider:
- Location: You’ll want to store your gold where it’s protected from humidity and extreme temperatures. So burying your gold outside is not ideal, and an interior safe is a better option.
- Security: If you use a safe, ensure it’s one a thief can’t easily pick up and carry away. Consider investing in a home security system if you don’t have one already.
- Insurance: Your regular homeowners policy likely won’t cover your gold, so you’ll need supplemental coverage. Some people are hesitant to take out insurance because they don’t want anyone to know they have gold at home. But failing to insure your investment is risky too.
Pros and cons of this method
Consider the benefits of storing gold at home.
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Possibility of theft. -
Additional costs for a safe, security system, and insurance. -
Gold stored at home is not eligible for a gold IRA.
Consider the reasons to think twice about keeping gold at home too.
We asked Kyle Ryan, CFP®, whether he has a preferred method for gold storage. Here’s what he told us:
The client’s circumstances can lead to varying recommendations:
- Large amount of gold? Hand it over to a professional vault that will handle your gold storage. This is more useful for larger amounts that won’t fit inside a safe-deposit box and the value of which isn’t affected much by the annual fees.
- Small amount of gold? Safe-deposit box to lower the cost of storage fees.
- Fee-conscious and untrusting of banks? Store it at home in a well-secured vault made for precious metals storage. Acquire the proper insurances.
If one would prefer not to have physical gold but would like to diversify their investment exposure, investing in securities that track the spot price of gold, or their futures, are viable options. This maintains liquidity, and you can sell out or add more at any time.
What to know about gold storage for IRAs
IRAs are retirement accounts that come with valuable tax benefits. Depending on how you set up the account, you could receive a tax deduction for contributions or forgo the deduction and receive tax-free distributions in retirement.
The two types of IRAs are traditional (or pretax) and Roth. Here’s a quick breakdown:
| Roth IRA | Traditional IRA | |
| Contributions | After-tax dollars | Pretax dollars |
| Withdrawals in retirement | Tax-free (with conditions) | Taxed as regular income |
| Income limits for contributions | Yes, based on income | No, but deductions may phase out |
| Required minimum distributions | None during owner’s lifetime | Start at age 72 |
| Tax timing | Pay taxes now | Pay taxes later |
| Withdrawal flexibility | More flexible | Less flexible |
| Read more | Roth gold IRA accounts | Traditional gold IRA accounts |
Many investors use IRAs to invest money in securities such as stocks, mutual funds and bonds, but self-directed IRAs are open to alternative investments, such as certain gold and precious metals. However, to get the tax benefits, you must follow specific IRS rules for storage.
What you should know about storing gold for IRAs
Despite what some ads say, you can’t use your house for storage for gold IRAs. This means running afoul of IRS rules, and if the government finds out, it will treat the gold as if you’ve taken a distribution from your IRA. As a result, you could pay income tax on the value of the gold plus a 10% penalty if you’re younger than 59 ½.
What’s more, you can’t store gold for a gold IRA in a bank safe-deposit box. The only place to keep the gold is with a qualified custodian in an IRS-approved depository.
The best place to store your gold for IRAs
Many depositories offer storage for gold, but not all are IRS-approved. Be sure to confirm the depository you select meets government requirements.
Popular choices include:
- CNT Depository
- Delaware Depository Service Company
- Brinks Global Services
- International Depository Services
- Dakota Depository Company
Kyle Ryan, CFP®, offers the following tips to choose a depository to store gold for your IRA:
- Use the one with the lowest fees that insures the entire amount of your holdings, if possible.
- If it doesn’t insure the entire value of your gold, consider using multiple depositories. H
- Solid customer service is valuable too.
- Security is less important, as long as it is insured.
FAQ
How much gold should I keep?
We ran this question by Kyle Ryan, CFP®, who advised:
Generally, I wouldn’t want to see more than 10% of someone’s investable assets in gold. They can at least diversify into other precious metals, such as silver.
Gold should be viewed, in my opinion, as an alternative diversification tool, the same as real estate. You want some exposure but not too much. Three percent to five percent is my go-to recommendation for someone investing in gold.
Is it illegal to store gold at home?
No, it is not illegal to store gold at home, but if your assets are part of a gold IRA, you will lose any tax benefits.
How do I insure my gold if I store it at home?
Most homeowners insurance policies provide only minimal coverage for precious metals. You may be able to purchase additional coverage, but even this can be limited. If you’re storing a significant amount of gold at your home, you may need to buy what is known as a floater insurance policy to cover it.
How much gold should I store at home?
Every person’s situation is different. Some people like to keep a percentage of their assets at home while storing the rest in a more secure location. Consider your personal comfort level, the security of your home, and the amount of gold you have when deciding whether and how to divide between storage options.
What are the signs of a reputable gold storage solution?
Look for gold storage providers with a proven track record, positive reviews, and transparent information about how they store precious metals. Ask about insurance and security measures, and if it is important that you maintain access to your specific gold items, look for a company offering allocated and segregated storage.
Do I pay taxes on gold I store myself versus in a bank or vault?
Yes, all investments, regardless of where they are stored, are taxable. If you sell gold you’ve stored for a year or more, the gains—the increase in value—are subject to capital gains tax. If you had the gold for less than a year before selling, the gains are subject to ordinary income tax unless it’s in a qualified retirement account.
