Self-Directed Retirement

What is a self-directed individual retirement account?

A self-directed retirement account is the tool investors use to get their retirement funds “out-of-jail” and into their full control. Since the 1970’s, US citizens have had the ability to invest in a diverse group of asset classes in order to play for their retirement through cash flow, without getting forced into stocks and bonds. Unfortunately, due to the massive amount of marketing most large-retirement custodians conduct, very few people know they can invest in alternative investments while building their retirement account.

A self-directed IRA account is an IRA that allows the account owner to make investment decisions and investments on behalf of the retirement account. The IRS requires that a custodian hold the IRA’s assets on behalf of the owner of the IRA. This custodian is responsible for managing all transactions and records pertaining to the IRA, filing the appropriate IRS reports, and handling all the administrative duties on behalf of the IRA owner.

A truly self-directed IRA plan gives you control of your retirement funds without fees and lost opportunities of using custodians that prohibit self-directed investments.

  • No transactional, asset holding fees – you pay no ongoing transaction fees regardless of how many investments you make
  • Checkbook control – allows you to make on the spot investments as you have funds readily available
  • True diversification – not only do you have access to the traditional IRA investments like stocks and bonds, you also have the ability to invest in real estate, tax liens, small businesses, private mortgages, and much more.
  • Create a real estate partnership agreement  – with a truly self-directed IRA, you can enter into partnerships with other investors, or partner with yourself.

What are the tax advantages of using a self-directed IRA to buy real estate?

When it comes to investing, it’s not what you make; it’s what you keep. Using your self-directed retirement plan can allow you to defer or even completely eliminate your tax exposure from income or gains from your investments. All of the income and gains from your real investments flow through your IRA, meaning that you do not pay taxes on your investments until you, personally, receive the profit. If you use a Roth IRA, your gains are completely tax-free.

If you invest $25,000 in a Roth IRA when you are 30 and leave the money invested at 9% until you are 59 ½, the Roth IRA will be worth $317,703.28 completely tax-free!

How do these transactions work?

  1. Set up your self-directed Roth IRA
  2. Fund your IRA
  3. Direct your custodian to invest your IRA’s funds
  4. Receive income and gains from your investments into your IRA
  5. Enjoy strong gains in diverse asset classes without paying taxes!

How do I set up my self-directed IRA?

In order to create a truly self-directed retirement account, you need to work with a custodian that allows you to invest in alternative investments like real estate.

In a previous article, I outlined the 5 best Roth IRA providers that specialize in self-directed accounts. I always suggest my clients work with Udirect, an inexpensive and experienced custodian that has assisted many of my clients invest in real estate and non-real estate transactions in their self-directed retirement account.

Udirect

(714)460-5505

info@uDirectIRA.com
Want to learn more about investing with a retirement plan?

HOME        CONTACT US         AVAILABLE  OPPORTUNITIES         SELF-DIRECTED RETIREMENT         ARTICLES

Asym Capital does not make investment recommendations, and no communication through this website or in any other medium should be construed as such. Investment opportunities posted on this website are “private placements” of securities that are not publicly traded, are subject to holding period requirements, and are intended for investors who do not need a liquid investment. Private placement investments are NOT bank deposits (and thus NOT insured by the FDIC or by any other federal governmental agency), are NOT guaranteed by Asym Capital and may lose value. Neither the Securities and Exchange Commission nor any federal or state securities commission or regulatory authority has recommended or approved any investment or the accuracy or completeness of any of the information or materials provided by or through the website. Investors must be able to afford the loss of their entire investment.Any financial projections or returns shown on the website are estimated predictions of performance only, are hypothetical, are not based on actual investment results and are not guarantees of future results. Estimated projections do not represent or guarantee the actual results of any transaction, and no representation is made that any transaction will, or is likely to, achieve results or profits similar to those shown. Any investment information contained herein has been secured from sources that Asym Capital believes are reliable, but we make no representations or warranties as to the accuracy of such information and accept no liability therefor. Offers to sell, or the solicitations of offers to buy, any security can only be made through official offering documents that contain important information about risks, fees and expenses. Investors should conduct their own due diligence, not rely on the financial assumptions or estimates displayed on this website, and are encouraged to consult with a financial advisor, attorney, accountant, and any other professional that can help you to understand and assess the risks associated with any investment opportunity. Investments in private placements involve a high degree of risk and may result in a partial or total loss of your investment. Private placements are generally illiquid investments. Investors should consult with their investment, legal, and tax advisors regarding any private placement investment.