Will the Legislation Pass?
It should. The objective of the legislation is to
restore for IRA investors the choice of investing in legal
tender United States coins, thereby reinstating an option
that had been previously available to them. Such
legislation is consistent with Congress’ and the
Administration’s desire to encourage U.S. citizens to
save/invest more and to take personal responsibility for
their retirement. Certified coins as qualified investments
appeal to investors who want the option to diversify their
investment portfolios with liquid, intrinsically valuable,
tangible assets.
Certified legal tender coins are already allowed
in corporate pension plans, and the American investing
public should not be penalized for not having access to
corporate pension options. The new legislation simply
expands the menu of options for investors and allows
them to diversify and stabilize their retirement
portfolios with tangible assets. A study done for the
Joint Committee on Taxation of the U.S. House and
Senate examined the investment performance of
portfolios that include and exclude rare coins and
concluded that the inclusion of rare coins in a
diversified portfolio of stocks and bonds increases the
portfolio’s overall return at the same time that it
reduces overall risk.
Moreover, unlike paper assets, rare coins are
tangible investments that have a legal tender and intrinsic
value. Indeed, as some stock portfolios are losing value,
investors are understandably nervous about having all of
their investment eggs in a volatile stock market basket.
