What is a Self-Directed IRA?
A self-directed IRA is a nontraditional retirement account that allows individuals to invest in what they already know and understand with alternative investment options not allowed within typical retirement plans,Guest Posting including the following:
Real estate – residential and commercial https://objects-us-east-1.dream.io/can-gold-ira/can-i-buy-gold-with-a-self-directed-ira.html properties, land, renovation or new construction, passive rental income -Mortgages and other loans -Private hedge funds -Precious metals -Limited partnerships -Commercial paper and notes -And many more
A broader selection of allowable investments in a self-directed IRA means informed consumers can develop a more eclectic portfolio that they control; it allows them to respond to economic downturns or take advantage of opportunistic (and tax-advantaged) investments in a more nimble way than going through a conventional IRA custodian.
If you have had experience before with these kinds of investments outside of your retirement plan, a self-directed retirement plan could be a smart way to grow your savings more aggressively.
Who Should Open a Self-Directed IRA?
If you are someone who understands certain markets and investments and perhaps is already investing in those as part of your retirement plan, consider applying what you know to this new investment strategy.
People who open a self-directed IRA may:
-Be an angel investor in a company -Purchase real estate or own rental property as an investment -Invest in certain commodities -Make unsecured personal loans to friends or certain relatives and earn tax-free interest on the loan
You can do all this within a self-directed IRA and enjoy the tax advantages of these plans.
Are you self-employed? You may open a self-directed SEP (simplified employee pension plan) IRA. Individuals can roll over the funds from a traditional IRA or an old 401(k) plan. You can even choose to keep your existing IRA account for stock and bond transactions and open a self-directed account for your other investments. And you can start with an initial investment of just a few thousand dollars.