You may have heard the terms "self-directed retirement account," "alternative IRA," or "real estate IRA," but like most investors, you could probably use some clarity. What exactly is a self-managed retirement account? What benefits does it have? And what possible effects can a Self-Directed IRA have as part of your retirement investment strategy? Get answers from the Self-Directed IRA Specialists at Madison Trust, then get help gaining control of your retirement investments with a Self-Directed IRA.
A Self-Directed IRA is just like a standard IRA. It’s a retirement account that you put funds into, and those funds are invested with the goal of helping them to grow. The main difference between Self-Directed retirement accounts and standard IRAs is the types of investments you can choose. With a standard IRA, you will invest in stock market products such as stocks, mutual funds, and bonds. With a self-regulated retirement account, you can invest in alternative assets. Popular Self-Directed IRA assets include real estate and private placements.
This is the classic Self-Directed retirement account where the custodian not only holds the account but also actively performs the transactions.
This is a type of Self-Directed IRA where the account holder can perform transactions on their own. This can be accomplished by establishing an IRA LLC or IRA Trust.
It's hard to detail a complete asset listing because a Self-Directed IRA can legally invest in almost any type of asset. The only three types of assets that are forbidden are collectibles, S-Corporation Stock, and life insurance settlements. Some of the more popular types of alternative investments include:
The choice to invest with a standard IRA or a Self-Directed IRA can depend on multiple factors. Investors and their investing goals are unique, so the way to achieve those goals can differ greatly. Here are the differences between a standard IRA and a Self-Directed IRA.