What You CAN’T Hold in an IRA

We hear a lot about what we CAN hold within our individual IRA accounts, but never anything about what we CAN’T hold within them.  A Roth IRA or Traditional IRA is an appealing financial vehicle since you have a wide range of choices versus something like a 401(k) plan where you are limited to a number of mutual funds to pick from.  We all know that investments such as stocks, bonds, mutual funds, index funds, ETF’s, and annuities can be held within an IRA.  The list goes on and on but you should be aware of the types of investments that are barred from these accounts.  Watch out for the following investments, since they’re not allowed in a tax deferred retirement account!

What you can’t hold in an IRA:

Coins and fine jewels

With the recent credit downgrade and the skyrocketing of gold, I’ve been getting asked quite a few times about holding physical gold, coin, or fine jewels in an IRA account.  Typically, if you want to place coins of bullion within an IRA account, the IRS requires that the coin be pure in its content.  Also, they cannot be seen as a collector’s coin.  This can be hard to prove, so most IRA providers just disallow this type of investment.  Like anything there are always exceptions.  You can check out American Eagle coins and Canadian Maple Leaf coins, as they are allowed in some IRA accounts.

Real estate – somewhat

Real estate is a tricky one.  It’s disallowed and then it isn’t.  What do I mean by this?  Well, you can actually hold real estate within your IRA account, however, you can’t benefit from it.  In other words, sure you can invest in real estate, but you can’t profit off the rental income or from the sale of it.  So, if you’re trying to buy your house with your IRA money, think again.

Antiques and collectibles

can't hold antiques in an IRA

Unfortunately, you can’t hold antiques and collectibles in an IRA.

Have you seen that PBS show about antiques?  Sometimes you’ll catch someone’s surprise that they own an antique worth thousands of dollars.  After the excitement dies down, many ask themselves, “How am I going to shield against taxes?”  Well, don’t bother trying to do that with an IRA account.  Everything from classic chairs to aged wine to WWII helmets are not allowed within an IRA account.  You’re actually better off keeping the item for the long haul and cashing out later down the road.

Life insurance and policies

Yup, you guessed it.  Life insurance plans and policies are completely off limits!  This includes everything from life insurance plans to variable policies.  There is a single exception, and it’s called the incidental policy rule.  If it’s a qualified plan, then one can purchase small amounts of life insurance within their IRA account.  If the IRS deems your plan a qualified plan, then the next step is to determine the amount allowed within the IRA account.  I call it the 50% test.  Your qualified plan is only allowed if the amount in premium purchased is less than 50% of your total contributions.  Yes, this is fine print and kind of hard to understand.  If you do this, you need to make sure you follow the IRS rules to avoid penalties.  Don’t test the IRS because they will find out.

Big picture…

What’s the big picture here?  You have a wide range of options to invest in your IRA account versus investments that aren’t allowed.  This is getting down to the minor details.  You should focus your energy on a diversified equity to bond portfolio balance depending on your age and avoid these types of investments that are questionable.  They are either completely disallowed outright or there are strict limitations.  Save yourself some headaches and stick to the vast number of investments that ARE allowed in an IRA.

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Published or updated December 30, 2014.


  1. You are right, there are enough choices that you can one that fits! The other things can be kept outside of an IRA. Those would be taxed at capital gains rates anyway if taxable at all.

  2. Kevin Beck says:

    Not exactly. Coins, antiques, jewelry and collectibles, if taxed, are always taxed at ordinary income tax rates, not as capital gains. This goes for ALL such collectibles. Life insurance proceeds paid to a beneficiary are never taxed. And real estate sales are taxed, except for your personal residence (in most cases).

    One other category of things that cannot go into an IRA is an interest in a non-incorporated business.

    Also, gold and silver Eagles are permitted in an IRA if the custodian permits.

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