Palladium is not popular as gold, silver, platinum, etc. It is an incredibly overlooked precious metal, particularly in the investment space. Most people don’t know that palladium exists, and those familiar often ignore it for other, more traditional valuable metals. There could be several reasons palladium is not common knowledge—one of them being its close resemblance to silver and platinum.
And because it’s not extremely popular among buyers and investors alike, assayers mint palladium items in limited numbers, fueling the metal’s under-the-radar status. It’s hard to say whether people don’t know or appreciate palladium because palladium goods are unavailable abundantly or manufacturers don’t focus much on palladium articles because of little demand. It’s unclear what fosters what.
Table of Contents
If you also don’t know much about palladium, read this article, especially if you want to set up a precious metals IRA. The following will be the significant points of discussion:
- A brief intro to palladium and palladium IRAs
- IRS (Internal Revenue Service) requirements for palladium IRA
- IRA-permitted palladium coins and bars
- Answers to some pertinent questions and more
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Palladium has become popular and more relevant in recent times. As knowledge spreads and people start to appreciate the metal more, it will only get costlier to invest in palladium. It’s, therefore, wise to act soon. Begin by educating yourself about the metal.
What is Palladium? Link or Comparisons to Platinum
Palladium is a precious metal. But unlike gold, silver, or even platinum, there’s little public knowledge or discourse about it. Many people could also hear the name for the first time or may not know it’s a precious metal. It’s, therefore, essential to get familiar with the precious metal.
Palladium is a glittery silver-white metal. In its natural state, it looks crystal-like. Palladium is very platinum-akin on the outside but has distinct physical attributes and qualities that make it unique. It’s slightly harder than platinum, which means it’s somewhat more resistant to scratches and doesn’t require rhodium polishing as often to keep its luster. Platinum, however, one-ups palladium in the density department. Palladium density is lower than both platinum and gold.
Palladium is one of the rarest precious metals found only in parts of the Americas, Australia, Russia, and Ethiopia. And with macroeconomic events and geopolitical tensions in palladium-producing regions, palladium has become rarer recently. Palladium can also be commercially extracted as the by-product of nickel, zinc, and copper refining. That means it’s unnecessary to mine the metal separately, making it quite eco-friendly.
Palladium is a noble metal that can effectively resist air and acid-resistant erosion. Like platinum, palladium is also “industrial” and often employed as an oxidizer. It’s used in the dental space and, at times, alloyed to form white gold. And when merged with other metals, it becomes even harder. Palladium is usually sandwiched between ceramic layers in ceramic capacitors, mobile phones, and laptops. Palladium is also used to power automobiles as fuel cells.
However, the primary automobile application of palladium is in the catalytic converters of petrol vehicles like platinum. But platinum is more common in hybrid or diesel vehicles than petrol machines due to its lower temperature tolerance.
What is a Palladium IRA?
A palladium IRA (individual retirement account) is a type of precious metals IRA that contains investments in the palladium metal or holdings representing the metal. It works like any other precious metal SDIRA (self-directed IRA) but represents investments in only or predominantly palladium. You can also have gold, silver, and other precious metals in your palladium IRA, provided they meet IRS requirements for inclusion in the retirement savings account.
IRS Palladium Requirements for an IRA
Palladium is one of the selected few precious metals allowed within an IRA setup. However, IRS has strict requirements that a palladium article must meet to be deemed IRA-eligible, which are:
- The palladium coin or bar should be .9995 fine or 99.95 percent pure and be made at a COMEX- or NYMEX-approved assayer.
- The palladium article should be stored in an IRS-approved depository. Holding the goods in a house, private property, or any place the IRS is unaware of or doesn’t recognize is untenable.
- The precious metals IRA account must have a custodian and a recognized dealer. The IRA custodian will operate as the account trustee.
IRA-Qualified Palladium Coins
Palladium coins have been in circulation since the 1960s. However, those were primarily commemorative coins and not eligible for IRA. Besides ancient palladium bullion and rare coins, several relatively modern palladium bullion coins don’t make the IRA cut. Here are some that do:
- American Eagle palladium coin (.9995; U.S. Mint): The 1 oz coin was introduced in 2017 with a $25 face value. The design is identical to the American Eagle gold coins and silver coins.
- Canadian Maple Leaf palladium coin (99.95 percent pure, Royal Canadian Mint): Issued in 2005, this 1 oz coin with a CAD 50 face value and featuring the same Maple Leaf bullion coin design was perhaps the first palladium coin from a major mint under a popular series.
Since palladium is not a very popular precious metal, several mints famous for their gold and silver coins have not yet issued palladium versions. Notably, there is no Austrian Vienna Philharmonic palladium coin. Also, the American Eagle coin is not readily available. However, the status quo will hopefully change, and many more coin manufacturers will hop on the palladium bullion train soon.
By the way, the Russian Ballerina palladium coin is claimed as IRA-eligible. But we have our doubts. First, it’s .999 fine, which doesn’t meet the purity threshold for IRA palladium. Also, the Moscow Mint makes the coin. It’s not clear whether it’s COMEX- or NYMEX-recognized. And then, the coin is “Russian,” which may not sit well with the IRS, particularly in the current context. Contact your IRA custodian to confirm the coin’s IRA eligibility. While at it, find out about other palladium coins that qualify for an IRA. We believe there are a few more.
Palladium Coins Ineligible for an IRA
Your IRA custodian may allow the Russian Ballerina coin, but the following coins are certain to be out:
- Portuguese Palladium Bullion Coin
- French La Fayette Palladium Issue
- The Isle of Man 1987 Bicentenary of American Constitution Palladium Set
- Chinese Palladium Panda 100 and 50 Yuan Coins
- Australia Emu Palladium Coins
Besides those mentioned above (non-exhaustive list), commemoratives, numismatic coins, collector coins, etc., are not allowed too. When you buy your coins through your custodian, they will let you know which ones are allowed and which aren’t.
IRA-Eligible Palladium Bars
The tale with IRA-eligible palladium bars is similar to palladium coins. Only a handful of bars are made of pure palladium. And out of those, a select few qualify for an IRA. The ones included are Credit Suisse, PAMP Suisse, and Baird palladium bars. Johnson Matthey, Argor Heraeus, and Valcambi Suisse palladium bars are also worthy of mention. Any palladium bar that meets the IRS-prescribed minimum fineness requirements and is manufactured at a duly certified and recognized mint is permitted inside a precious metals IRA.
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Palladium is a solid choice if you’re looking to diversify your retirement or investment portfolio and are not very keen on traditional precious metals. Although a gold IRA or silver IRA is still the more common path, a palladium IRA is not far-fetched. Unfortunately, there aren’t many IRA-approved palladium bars or coins to invest in. But because it’s not mandatory to showcase variety in your IRA, you can always buy as many American Eagle and Canadian Maple Leaf bullion coins if you have the cash. And then there are palladium bars as well. Just don’t overinvest. Else, you risk stalling your retirement fund’s growth.
Is there pure palladium jewelry?
Yes, there is jewelry made purely of palladium. But those are rare since the precious metal is hard to find, and the demand is not crazy either. Palladium is usually mixed with platinum to lend more integrity to platinum jewelry. Palladium jewelry, by the way, cannot be added to a precious metals IRA.
Is palladium pricier than platinum?
Because palladium is an industry-critical metal, its price moves in correlation to industrial output. However, palladium is usually more expensive than platinum since its rarer. Palladium, however, has not been pricier than platinum always. Only in the past few years has it gained more steam and edged past platinum.