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What Assets Can Be Held in a Self-Directed IRA?

A Self-Directed IRA empowers investors to expand their choice of assets. In a standard IRA, the account holder is typically limited to stocks or other market products, but with a Self-Directed IRA, the investor is able to profit from almost any asset. What assets can be held in a Self-Directed IRA? Currently, real estate and private placements are two of the most popular self-directed assets, but promissory notes are also gaining popularity as investors begin to realize their value. You can also invest in precious metals like gold, as long as you follow the IRS rules for investing in these commodities.

Explore Your Options

Fast Facts
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Many investment options: commercial real estate, raw land, fix n’ flips, and more
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High growth potential
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Steady/passive income source
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Real Estate
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Yield predictable returns
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Note terms are outlined before the transaction
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Three loan types: Notes Secured by Real Property, Notes Secured by Non-Real Estate, and Unsecured Notes
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Promissory Notes
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Fast Facts
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Invest in any company/stock not sold on the public market
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Numerous Investing Options: Hedge Funds, Startups, REITs, and more
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Please ensure the investment is the right opportunity for you
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Private Placements
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Fast Facts
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Value increases when stocks, bonds, and mutual funds decrease
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Provides a good hedge against inflation
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Seen as a global store of value
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Precious Metals
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Fast Facts
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Can result in high returns when the company grows
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Invest in a local restaurant, healthcare startup, new tech company, new movie venture, small business, and more
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Ample opportunities online - new investment ideas are at your fingertips
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Startups & Crowdfunding
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The list is pretty much endless!

Some examples include:
And Beyond!

Real Estate

Real estate is a prime asset for an SDIRA because it brings together three unique elements:

• Knowledge: Investors can invest in a property that they’re familiar with if they feel comfortable with its income potential.

• Management: Unlike most investment assets, a piece of real estate can be fully managed by the Self-Directed IRA's account holder. That means the power is in their hands to direct the investment successfully.

• Profitability: Real estate often provides great value. The property itself can grow in value over time, it can bring in steady rental income, and it will always retain some value.
If you're interested in learning how to invest an IRA in a property, we can help walk you through how to buy real estate with your Self-Directed IRA.

If you have questions about investing in real estate, read our article covering 11 questions Real Estate IRA owners ask.

There are many different types of real estate you can invest in with a Self-Directed IRA including:  

Promissory Notes

Promissory notes are investments that take the form of a loan. If an individual or company needs funding, your Self-Directed IRA can offer them a loan at a set interest rate. The appeal of promissory notes is that the profits are determined in advance. Assuming that you have a credit-worthy recipient, you should know exactly how much the loan payments will be and over what period of time. This differs greatly from a standard asset, where the profits are typically unpredictable until they actually occur.

Private Placements

A private placement typically refers to investing in a non-market asset, such as a private equity fund, startup, or real estate venture. There are two reasons why this is a popular investment for a Self-Directed IRA:
1

Availability

These investments cannot typically be accessed from a standard IRA, but with a Self-Directed IRA, you can invest in alternative assets such as private businesses.
2

Funding

A private placement will often require the funds to be held in the asset for three to five years. This may not sit well with standard accounts, where investors want liquidity, but it works great for a retirement account, where the funds are meant to grow until retirement.

Precious Metals

Precious metals such as gold, silver, platinum, and palladium may be invested in with a Self-Directed IRA. There are many benefits of investing in precious metals including that it’s a hedge against inflation, it has consistently held value throughout history, and it’s a great portfolio diversifier.

Startups and Crowdfunding

The startup and crowdfunding investment opportunities available to Self-Directed IRA investors are nearly endless.

Startups

Often times entrepreneurs create companies they believe in but unfortunately lack adequate funding in order to further their business. Self-Directed IRA investors can invest in these new companies and can potentially receive significant returns on their investment. 

Crowdfunding

Whether you are looking to invest in peer-to-peer loans, syndicated real estate offerings, shares in commodities like timberland, or another crowdfunding opportunity, a Self-Directed IRA is the account that allows you to do just that. 

Our Story

Madison Trust is an industry-leading Self-Directed IRA custodian with a passion for empowering individuals to gain control of their retirement investing. Learn more about our story from our President & CEO, Daniel Gleich.

More Resources

View Our Webinars

Check out our schedule of upcoming webinars and view our previously recorded webinars to learn about Self-Directed IRAs, alternative investments, trending industry topics, and more!

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Whether you're interested in learning about what you can invest in or you need a guide to help set up your account, you can find all the help and information you need in our blog. Be sure to check back regularly to stay up-to-date on all of the information you need to know about investing with a Self-Directed IRA.

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Self-Directed IRA Resources

Explore our informative gallery of articles and videos discussing topics such as the essentials of Self-Directed IRAs, fundamental aspects of Real Estate IRAs, investing with a Gold IRA, and more in our Self-Directed IRA resource center!

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