Self-Directed IRA fees come in a variety of forms and can be difficult to understand. Not only are there different kinds of Self-Directed IRA platforms (each with its own unique fees), but even when comparing identical platforms, the fee structures can be radically different. Let's break down the possible fees in a Self-Directed IRA and what you should look for when comparing plans.
Self-Directed IRA fees come in a variety of forms and can be difficult to understand. Not only are there different kinds of Self-Directed IRA platforms (each with its own unique fees), but even when comparing identical platforms, the fee structures can be radically different. Let's break down the possible fees in a Self-Directed IRA and what you should look for when comparing plans.
Yes: There is no such thing as a fee-free Self-Directed IRA. However, the way the fees are structured can change depending on the type of Self-Directed IRA. For some companies, this means charging a heftier setup fee, while for others, it can mean charging a percentage of asset value. In order to better understand Self-Directed IRA fees, you should first learn about the types of accounts.
Some of the common Self-Directed IRA fees you'll encounter include:
Now that we know the basic kinds of Self-Directed IRA accounts and the standard fees, let's find out what fees you may be charged based on your account type.
Every investor would love to pay the most economical fees and get the best account functionality. However, due to the nature of Self Directed IRA investing, the choice of fee structure is not always an easy one. This is because the fees can vary not only by company but also according to two other factors:
With that in mind, let’s cover some of the more popular Self Directed IRA assets and determine the best kind of fee structure for each.
The payment of IRA custodian fees is tax-deductible if you deduct certain expenses under "miscellaneous itemized deductions." However, this only counts if the Self-Directed IRA fees were paid through your personal funds and didn't come out of your IRA account.