New to site; IRA question

[ancesthntr]

I've been lurking for a while, and also hunting for coins for a while. I started out with halves, and I've gotten perhaps 200 40% and about 30 of the '64s and a few Franklins since starting in earnest about 2 years ago. I've been skunked a few times, but usually I get about 3 40% and 1 '64 per box. My best box gave me 3 '64s, 3 Franklins and 58 40%. Another time I got skunked on the first box, then got over 30 of the 40%ers and a couple '64s. I also got 3 clad proofs (in very scratched up condition) and about 40 of the NIFC halves. I've also gone through about 100,000 pennies to get the pre-'82s, and in the process maybe gotten 300-400 wheats (incl. 1, count'em 1 steelie) and roughly 14,000 pre-'82s. I've also done nickels, all of which I'm keeping because the metal content is worth more than $0.05, but I cull out the 2009s (41 so far), look for speared bisons (none yet) and everything before 1960. I finally got a War Nickel last week, the first out of roughly $150 worth.

OK, why did I join? To tell you my situation and ask the question below: I left a job at the end of last year, and I had some 401(k) money left over. I had contributed a bit less than $2,000, but the account is now over $6K because of various employer matches. I was thinking about taking around $2,600 out and rolling the rest into my IRA, with the intent of netting about $2K after the tax withholding and the administrative fees. Why? So that I can start ordering 4 boxes at a clip (money is otherwise tight, and I only get boxes irregularly). I would like to do 4 boxes/week, or at least do it twice a month.

Question: Do others here think it advisable to take the tax hit now? I think that the answer is "yes," based on the following math:

Assuming 3 40% and 1 90% per box, that's just a tad over 0.8 oz. of Ag per box, or 3.2 oz. per week (or per round trip, if I don't do it every week). At $40 per oz., that's $140/round trip, at a cost of $8 (face value) plus a little bit for gas, for a profit of roughly $130. Even if I get 3 40% per box and only 1 90% per 4 boxes (and I've done better than that on average), that's still 2.13 ounces, worth about $85.50, less the cost of $6.50 face value, for a $79 profit. Even if I do this only twice per month, it seems that the worst case is a profit of close to $1,900 for the year, less whatever little bit of gas to pick up and dump the coins (plus labor to do the sorting, plus my wife being pissed at all the time that I'll be taking to do this - though I figure that I can sell a bit of the silver and buy her some jewelry to keep her satisfied). Seems to be a nice return on my money, doesn't it?

Anyhow, I await everyone else's input. Thanks much.

 

[47thelement]

Ou'd be better off asking your tax advisor

 

[FIRE310]

Assuming 3 40% and 1 90% per box


The above is from your post.... Thats a huge assumption and I would say that most people on the board are not pulling that out of every box.....

My boxes the last year have gone down to MAYBE one 40% a box. I would not use your above mentioned example to make a reason to do more boxes.

There are folks on here right in the middle of 15-25 box skunk streaks...


I dont do this for profit "per say" I throw them all in a pile and in 25 years when I retire they are there if I need them. Plus its like fishing, I never know what I'm gonna get.

 

[ancesthntr]

@Fire310:

I appreciate your advice, and I have also read the reports of people having bad skunk streaks. I've had some myself. However, that average is my approximate results over the last 2 years, with perhaps 35 boxes in total (and if I do this I will keep detailed records). 2 of the boxes have been spectacular, about 5 have had twice the average, 10 or so have been average, and most of the rest skunks. I think that, at least for a while, such performance is doable. But even if not - let's assume 1 40% per box and 1 90% in each 4 boxes - it'll still be profitable. Such would generate a profit of about $35.50/4 boxes at $40/oz. Ag. If that's done every week, that's about $120/month profit, over $1400/year. Not a fortune, I'm not retiring early on it, but that is worth it for me. Plus you never know when a great box will come along - my best box netted me 10.8 oz., worth about $460 at today's price.

At $40 Ag, I'm doing it for the money - though I'm not cashing in for a while, as I believe that Ag will go up considerably over the next few years. I sold a couple hundred bucks face of 40% halves about 3 years ago, and I very much regret having done so. The dollar is in virtual free-fall, and the fundamentals of silver (we're using up silver much faster than we're mining it, and have been for a several decades, with more uses being found every year) are such that I could see a price of $100 in 3-5 years, possibly higher due to speculation (similar to the oil spike now and 3 years ago). Silver will get noticed a LOT once it breaks the old Hunts Brothers high of about $50, even though the inflation-adjusted high is around $130, and when it gets noticed a lot of people will begin buying, making a speculative spike more likely. Great if you have it already, though I think that such prices will nearly end this aspect of CRHing (and also dimes).

 

[ArkieBassMan]

... Not a fortune, I'm not retiring early on it, but that is worth it for me. ...

I believe that is your answer right there. If its worth it to you, then go for it.

I too share Fire310's skepticism about your ability to average 3 40% and 1 90% per box. 35 boxes in, that is what you're averaging (and that is an extremely HIGH average btw), but I would venture to say that 35 boxes is not nearly enough boxes to get a good average. Your monster 64 keeper box is really skewing your average. In reality, that very well may be the best box you ever get - by far. Most of us have never gotten a box anywhere near that. Also, your banks could quit ordering boxes for you, or begin to charge you a fee to buy and/or dump. Its happening all across the country and something else to consider. On the other hand, at today's silver prices, it won't take many keepers to pay for the tax hit (which you are going to have to pay eventually anyway) and outperform your 401K.

Its all up to you, and it is a gamble as there is absolutely no guarantee of success.

 

[clovis97]

Since you are asking for opinions:

I wouldn't touch that IRA in a million years.

I've had, including today's box, 15 skunks in a row. I personally think it is crazy to take money set aside for your older years, for use on boxes.

What if you get a 15 or 50 box skunk streak, and find nothing? Will it have been worth it?

Just my 50 cents.

 

[mlayers]

I also would not touch your IRA to get money to CRH. Why don't you try and do some scraping to get some extra money. There is big money in scraping. I pick up all type of metal and scrap it out. Last year in little over a month me and my son each did alright. I made enough to buy a new Ecalibur to detect in the water with. I took a load of stuff I picked up this lst week and got $74 for it. So there is other way to get some extra money just sit back and think on what you can do to get some. Everytime yu get a extra $10 put in into 2 rolds of dimes or a nother roll of halfs.....Matt

 

[quiksilver]

lol i just took some money out of my IRA to buy some physical silver. CRHin just isnt netting enough. I could care less about the hit i will take next year, beats the hit ive been taking now with the side bonus of big brother not being able to take it [like some other countries] or giving me less social security in the future because i have an IRA.