Solo 401k Precious Metals Terminology
Allowable Bullion for Solo 401k – pertains to American Eagle coins produced by the United States Mint and bars and rounds produced by a refiner/assayer/manufacturer accredited/certified by NYMEX/COMEX, NYSE/Liffe, LME, LBMA, LPPM, ISO 9000, or national government mint and meeting minimum fineness requirements.
Gold = 99.5%; Silver = 99.9%; Platinum = 99.95%; Palladium = 99.95%
Allocated & Unallocated Accounts - refers to the accounting of bullion held in custody.
Allocated Account- An account in which bullion is allocated to a particular account on the books and records of the custodian and physically held in a vault. The bullion may be held in either a segregated or non-segregated fashion.
Unallocated Account – An account where specific bars are not set aside and the customer has a general entitlement to the metal. Credit balances on the account do not entitle the creditor to specific bars of gold or silver, but are backed by the general stock of the bullion dealer with whom the account is held. Unallocated accounts are not acceptable for Solo 401k plan or IRAs.
Bullion – refers to gold, silver, platinum or palladium coins or bars that are bought or sold based on the intrinsic value of the precious metals they contain. It does not include coins and bars that are traded based on rarity, numismatic or collectible value.
Fineness – refers to the purity of a bullion coin or bar.
A gold bar of 99.99% purity is said to be “four nines”
Fungible & Non-Fungible Products – refers to the “exchangeability”of precious metals products.
Fungible – Items that are manufactured to the exact same specifications (i.e., weight and fineness) and can be readily exchanged with, or substituted for one another without any resulting difference in quality or market value.
Ex. 1-ounce Maple Leaf coins are interchangeable with each other.
Non-Fungible – Items that vary in specification (i.e., weight, brand and/or fineness) such that if exchanged with, or substituted for one another, a difference in quality and/or market value results. The most common non-fungible products are 100-ounce and 400-ounce bars, 1,000-ounce silver bars, 50-ounce platinum bars and 100-ounce palladium bars.
Ex. 1,000-ounce silver bar that actually weighs 1,032.65 ounces cannot be exchanged for another 1,000-ounce bar that weights 989.76 ounces because the value is different.
Hallmark – refers to the refiner/manufacturer of bullion bar or round.
Segregated & Non-Segregated – refers to the physical arrangement of how precious metals products are stored in relation to one another while in the custody of a depository.
Segregated – An entity’s bullion is held separate and apart from all other items in the depository.
Non-Segregated (also “comingled”) – Items are physically intermingled with one another while in custody without regard to any special distinction, status or difference among them (also referred to as “bulk storage”).
Addittional Information
Solo 401k Precious Metals
How to purchase precious metals with Solo 401k
Gold = 99.5%; Silver = 99.9%; Platinum = 99.95%; Palladium = 99.95%
Allocated & Unallocated Accounts - refers to the accounting of bullion held in custody.
Allocated Account- An account in which bullion is allocated to a particular account on the books and records of the custodian and physically held in a vault. The bullion may be held in either a segregated or non-segregated fashion.
Unallocated Account – An account where specific bars are not set aside and the customer has a general entitlement to the metal. Credit balances on the account do not entitle the creditor to specific bars of gold or silver, but are backed by the general stock of the bullion dealer with whom the account is held. Unallocated accounts are not acceptable for Solo 401k plan or IRAs.
Bullion – refers to gold, silver, platinum or palladium coins or bars that are bought or sold based on the intrinsic value of the precious metals they contain. It does not include coins and bars that are traded based on rarity, numismatic or collectible value.
Fineness – refers to the purity of a bullion coin or bar.
A gold bar of 99.99% purity is said to be “four nines”
Fungible & Non-Fungible Products – refers to the “exchangeability”of precious metals products.
Fungible – Items that are manufactured to the exact same specifications (i.e., weight and fineness) and can be readily exchanged with, or substituted for one another without any resulting difference in quality or market value.
Ex. 1-ounce Maple Leaf coins are interchangeable with each other.
Non-Fungible – Items that vary in specification (i.e., weight, brand and/or fineness) such that if exchanged with, or substituted for one another, a difference in quality and/or market value results. The most common non-fungible products are 100-ounce and 400-ounce bars, 1,000-ounce silver bars, 50-ounce platinum bars and 100-ounce palladium bars.
Ex. 1,000-ounce silver bar that actually weighs 1,032.65 ounces cannot be exchanged for another 1,000-ounce bar that weights 989.76 ounces because the value is different.
Hallmark – refers to the refiner/manufacturer of bullion bar or round.
Segregated & Non-Segregated – refers to the physical arrangement of how precious metals products are stored in relation to one another while in the custody of a depository.
Segregated – An entity’s bullion is held separate and apart from all other items in the depository.
Non-Segregated (also “comingled”) – Items are physically intermingled with one another while in custody without regard to any special distinction, status or difference among them (also referred to as “bulk storage”).
Addittional Information
Solo 401k Precious Metals
How to purchase precious metals with Solo 401k