The Glossary of Gold
A plain-English guide to the terms you will meet when buying precious metals or opening a Precious Metals IRA. Have a question about anything here? Our specialists are a phone call away.
Accounts, IRAs & Funding Definitions
Precious Metals IRA
A self-directed IRA that lets you hold physical gold, silver, platinum, and palladium instead of only paper assets like stocks and bonds.
Self-Directed IRA
A retirement account that gives you access to alternative, tangible assets beyond the stocks, bonds, and mutual funds offered by a typical brokerage.
Custodian
The IRS-approved institution that administers your self-directed IRA, handles transactions, and keeps the account compliant. Every self-directed IRA is required to use one.
Rollover
Moving funds from an existing retirement plan, such as a 401(k), into a Precious Metals IRA. Handled correctly, it happens without taxes or penalties.
Direct Rollover
A rollover in which funds move straight from your old plan’s custodian to your new IRA custodian, avoiding withholding and the 60-day deadline.
Transfer (Trustee-to-Trustee)
A direct movement of funds between two IRA custodians of the same type. The money never passes through your hands.
Traditional IRA
A tax-deferred retirement account funded with pre-tax dollars. You pay taxes when you take withdrawals in retirement.
Roth IRA
A retirement account funded with after-tax dollars, allowing qualified withdrawals to be taken tax-free.
401(k)
An employer-sponsored retirement plan that can often be rolled over into a Precious Metals IRA.
403(b) and TSP
Retirement plans for non-profit employees (403(b)) and federal employees (the Thrift Savings Plan) that may also be eligible to roll into a metals IRA.
SEP and SIMPLE IRA
Employer-based IRA plans for small businesses and the self-employed that can hold precious metals when self-directed.
Contribution Limits
The maximum amount the IRS lets you add to an IRA each year. The limit varies by account type and age.
Distribution
A withdrawal of funds or metals from your IRA. It can be taken as cash or as an in-kind delivery of the physical metal.
In-Kind Distribution
Taking a distribution as the actual physical metal shipped to you, rather than as cash.
RMD (Required Minimum Distribution)
The minimum amount the IRS requires you to begin withdrawing each year from a Traditional IRA once you reach the qualifying age.
Early Withdrawal Penalty
The tax penalty, generally 10 percent, applied to distributions taken before retirement age.
Tax-Deferred
Describes an account where taxes on growth are postponed until you take distributions, letting your metals grow without being taxed each year.
Beneficiary
The person you designate to inherit the assets in your IRA.
Storage & Security Definitions
Depository
A secure, IRS-approved facility where IRA metals must be stored for compliance and safekeeping. Metals in an IRA cannot be kept at home.
Segregated Storage
Storage in which your specific coins and bars are kept physically separate and individually identified as yours.
Commingled (Allocated) Storage
Storage in which your metals are pooled with others of the same type. You own an allocated quantity, though not specific pieces.
Vault
The secured space within a depository where physical metal is held.
Insured Storage
Coverage carried by approved depositories that protects the full value of stored metals against loss or theft.
Free Shipping and Storage
A Priority Gold offer that covers the cost of delivery and initial storage on qualifying orders.
Metals, Products & Minting Definitions
Bullion
Precious metal valued mainly by its weight and purity rather than its rarity or collectibility.
Coin, Bar, and Round
The three standard physical forms of bullion. Coins are struck by government mints, bars are made by refiners, and rounds are minted privately.
Mint
The facility, usually run by a government, that produces coins. Examples include the U.S. Mint and the Royal Canadian Mint.
Mintage
The total number of a given coin ever produced. A lower mintage can raise a coin’s collectible value.
American Eagle
The U.S. Mint’s flagship gold and silver bullion coin. It is widely IRA-eligible and one of the most liquid coins in the world.
American Buffalo
The U.S. Mint’s .9999 fine, 24-karat gold bullion coin.
Canadian Maple Leaf
The Royal Canadian Mint’s .9999 fine gold or silver coin, prized for its purity and IRA eligibility.
Krugerrand
South Africa’s historic gold bullion coin and one of the most traded in the world.
Vienna Philharmonic
Austria’s .9999 fine gold and silver bullion coin, which is IRA-eligible.
Fractional Coins
Coins minted in sizes smaller than one troy ounce, such as 1/2, 1/4, or 1/10 ounce, for smaller purchases and easier resale.
Troy Ounce
The standard unit of weight for precious metals, equal to about 31.1 grams. It is heavier than a standard ounce.
Purity (Fineness)
The proportion of pure precious metal in a product, shown as a percentage or decimal. For example, .9999 fine means 99.99 percent pure.
Karat
A measure of gold purity in 24ths. 24-karat is pure gold, while 22-karat, like a Krugerrand, is 91.67 percent gold.
Proof Coin
A specially struck collector-grade coin with a mirror-like finish, produced in limited numbers and often preserved in a display case.
Brilliant Uncirculated (BU)
A coin in pristine, never-circulated condition with a standard, non-proof finish. This is the default condition for most bullion.
Numismatic Coin
A collectible coin valued for its rarity, condition, and history well beyond its metal content.
Semi-Numismatic Coin
A coin whose value comes from both its metal content and a modest collectible premium.
Certified Coin
A coin that has been authenticated, graded, and sealed, or slabbed, by an independent grading service.
Condition
The physical state and grade of a coin, such as Brilliant Uncirculated, Proof, or Circulated.
Circulated vs. Uncirculated
Whether a coin has been used in commerce and shows wear (circulated) or was never released into circulation (uncirculated).
Coinage
Metal that has been stamped into coins of a fixed weight and fineness for use as money.
Assay
The official testing and certification of a metal’s purity and weight. Bars often ship sealed in an assay card.
Refiner
A company that produces and stamps bullion bars, such as PAMP or Valcambi. A refiner’s reputation affects the premium.
LBMA and COMEX
Major precious-metals market authorities. LBMA Good Delivery refiners and COMEX-approved products are industry benchmarks for quality.
IRA-Eligible Metals
Coins and bars that meet IRS purity standards, generally .995 fine gold and .999 fine silver, and are permitted inside a Precious Metals IRA.
Sovereign Coin
A coin issued and backed by a national government, carrying a face value and legal-tender status.
Paper Gold
Financial instruments such as ETFs, futures, and certificates that track the price of gold without giving you ownership of physical metal.
Grading & Authentication Definitions
Grading
The professional assessment of a coin’s condition on a standardized numeric scale.
NGC and PCGS
The two leading third-party coin grading services, the Numismatic Guaranty Company and the Professional Coin Grading Service.
Hallmark
A stamped mark on a bar or coin that certifies its refiner, weight, and purity.
Pricing & Market Definitions
Spot Price
The current live market price for one troy ounce of a metal, before any dealer premium.
Premium
The amount charged above the spot price to cover minting, distribution, and dealer costs.
Spread
The difference between the price to buy a metal (ask) and the price to sell it (bid).
Bid Price
The price a dealer will pay to buy metal from you.
Ask Price
The price a dealer charges to sell metal to you.
Melt Value
The raw value of a coin’s metal content at current spot prices.
Intrinsic Value
The inherent worth of an item’s actual metal content, apart from any collectible or face value.
Face Value
The legal-tender denomination stamped on a coin, usually far below its metal value.
Legal Tender
Money a government recognizes for settling debts. Sovereign bullion coins carry legal-tender status.
Gold-to-Silver Ratio
The number of ounces of silver it takes to buy one ounce of gold, used to gauge the relative value of the two metals.
Buyback
A dealer’s program to repurchase metals from clients who want to sell.
Dollar-Cost Averaging
Buying a fixed dollar amount of metal at regular intervals to smooth out the effect of price swings over time.
Capital Gains
The taxable profit earned when you sell metals for more than you paid, outside of a tax-advantaged account.
Economic Concepts Definitions
Fiat Currency
Government-issued money that is not backed by a physical commodity. Its value rests on government decree and is vulnerable to inflation.
Gold Standard
A monetary system in which a currency’s value is tied directly to a fixed quantity of gold.
Inflation Hedge
An asset, such as gold, held to preserve purchasing power as the cost of goods rises.
Hedge
An investment held to offset potential losses in another part of your portfolio.
Diversification
Spreading investments across different asset classes so that metals can help offset risk in paper markets.
Liquidity
How quickly and easily an asset can be turned into cash without losing value. Widely recognized bullion coins are highly liquid.
Store of Value
An asset that reliably holds its purchasing power over long periods of time.
Safe Haven
An asset investors move into during market turmoil to help protect their capital.
Counterparty Risk
The risk that the other party to a financial contract fails to deliver. Physical metal you hold has none, unlike paper gold.
Still Have Questions?
Understanding the language is the first step. When you are ready to talk through your options, a Priority Gold specialist can walk you through the details with no pressure.
