Using Self Directed IRAs for investing

Comments Comments Off on Using Self Directed IRAs for investing by on September 15, 2010

More IRA Investment Options for Your Retirement Funds

Few people know that Individual Retirement Accounts (IRA) can include a wide range of investment options. It’s a common misconception among Americans that the only IRA investments allowed in a retirement account are stocks, CDs, and mutual funds. A self directed individual retirement account (SDIRA) is one in which the owner can directly invest the funds wherever he or she wishes. This provides great flexibility for making high-performance investments using tax deferred funds including real estate, private lending, tax liens and private equity deals.

Always available, but little known

Alternative investments have always been available, but little discussed by personal finance experts. The Entrust Group website states “The truth is that broader IRA investment options have been available to the public since 1975, the year contributions could first be made to IRAs.”

How to create a Self-Directed IRA (SDIRA)

Here’s some additional information on the benefits and how to get started:
How to Create a Self Directed IRA (SDIRA) For Permanent Wealth

Self-Directed IRA investment options

Prohibited Holdings in a Self Directed IRA

In addition, you may NOT purchase any of the following in a self-directed IRA:

  • Collectibles (includinng works of art, rugs, antiques)
  • Metals other than gold, silver and palladium bullion
  • Gems
  • Stamps
  • Coins (except certain U.S.-minted coins)
  • Alcoholic beverages, and other tangible personal property as may be defined by the Secretary of the Treasury is prohibited

However, your individual retirement account may invest in one, one-half, one-quarter, or one-tenth ounce U.S. gold coins, or one-ounce silver coins minted by the Treasury Department. It can also invest in certain platinum coins and certain gold, silver, palladium, and platinum bullion.

Additional Resources

Companies like The Entrust Group, uDirect IRA and Equity Trust specializing in helping individuals file the necessary paperwork to create a SDIRA and start investing. If you start exploring this, ask about establishing a checkbook SDIRA instead of using a 3rd party rustee. It makes things much easier without any drawbacks that I’ve seen or heard about.


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