Protecting Your Retirement Assets in a Self-Directed IRA
A self-directed IRA is an excellent option for the confident investor who is ready to take control of his or her financial future. Many investors are unaware that the IRS permits an IRA owner to choose from a wide variety of commonly permitted investments, which go far beyond the usual mutual funds offered by large brokerage firms. Why is this important? Because diversification is one of the best ways to protect your retirement assets. Whether you choose a Traditional self-directed IRA or a self-directed Roth IRA, your IRA can buy a very wide variety of asset classes to protect your savings from the inevitable fluctuations within the various financial segments. True diversification goes well beyond a mix of stocks and bonds; individual retirement accounts can be used for investing in real estate, a limited liability company, structured settlements, precious metals, mortgage notes, and any number of other alternative assets. In fact, the IRS does not dictate which permitted investments you can use your self-directed IRA to buy; rather, it has established a short list of prohibited asset types and transactions that IRS regulations prohibit (such as self-dealing in property owned directed or indirectly or held by a fiduciary or service for the owner of the IRA). For years, CamaPlan has been a leader in providing self-directed IRA services for investors who are ready to start building their wealth on their own terms.
Choose Your IRA Custodian Wisely
Part of protecting your retirement savings is choosing the right IRA custodian. As a self-directed IRA custodian, CamaPlan provides a different type of service than the typical large brokerage house. The reality is that the average investment firm has financial incentive to direct an account owner to put their money in a mutual fund or other financial products managed by the broker. There is an inherent conflict of interest in taking investment advice from a company with a vested interest in profiting from your IRA investment asset allocation. It is different at CamaPlan. We sell no financial products and receive no commissions; therefore, our only goal is to empower you as the account holder to take full advantage of the wide range of investment options available to self-directed IRAs. CamaPlan offers retirement plans with transparent, easy-to-understand fee structures, ongoing investor education opportunities, and clear risk and benefit information. Our highly trained staff is experienced in self-directed IRA rules and is there to support the unique needs of each individual investor. We manage the required reporting and paperwork for the Internal Revenue Service, while you decide which alternative asset classes will be more secure and lucrative for your personal finance goals. When you are ready to move your funds to a self-directed retirement account, CamaPlan is the IRA custodian of choice.
Diversify Your Assets
Did you know that self-directed IRA plans can be used to buy real estate, invest in small businesses and entrepreneurs, purchase tax liens, form equity trust plans, or buy precious metals? Retirement experts all agree: diversification is one of the keys to protecting your assets. In fact, there are very few prohibited asset types for self-directed IRAs. State securities regulators and the IRS forbid the use of self-directed retirement plans for a few specific types of transactions, such as making personal loans to yourself, dealings with a disqualified person such as a spouse, lineal descendant, or entity (such as a corporation, partnership, limited liability company, trust or estate) of which 50% or more is owned directly or indirectly or held by a fiduciary or service provider. Also disallowed is dealing with an entity that is a 10% or more partner or joint venturer of with an entity that is 50% or more owned directly or indirectly or held by a fiduciary or service provider. While you absolutely can use your IRA to buy real estate, there are exceptions for certain methods of investing in real estate; for example, using a self-directed IRA real estate plan to buy investment property for personal gain (ie, buying a vacation home) is not permissible. Beyond a very few exceptions, our investors use their self-directed IRAs to invest in a myriad of high-yield assets, such as:
- Real estate
- Precious metals
- Mortgage notes
- Hedge funds
- Tax liens (you may wish to consider a creating a Limited Liability Company structured IRA with checkbook control if you intend to invest in assets like tax liens that require ready access to funds)
- Private placements: invest capital in a start up business and earn equity as it grows
- Oil, gas, timber, and mineral rights
- Stock shares or futures
Keep in mind that you can further diversify by making an IRA purchase within sub-categories of primary alternative asset types. For example, a real estate IRA can be used to buy residential property, commercial property, rental properties, or unimproved land. In addition to IRA held property, you could invest in an LLC or Limited Partnership that invests in real estate or holds mortgage notes. The more diversified your retirement portfolio is, the better prepared you will be to weather the fluctuations in prices of real estate, precious metals, the stock market, and other investments. Contact a CamaPlan consultant for more information on protecting your assets with a diversification strategy.
Become an Educated Investor
You wouldn’t take an exam without studying the material first, and the same should be true for your investments. A well-educated investor is the one most likely to make sound investments that will offer the highest returns. CamaPlan is pleased to provide individuals with ongoing investor education through our Cama Academy articles, videos, webinars, and in-person seminars. We offer investors the tools they need to become informed and expand their personal knowledge about a wide range of topics, including alternative asset types, how to evaluate potential investments, state and federal guidelines for Traditional and Roth self-directed IRAs, and more. CamaPlan does not provide individual investment advice; therefore, the self-directed IRA owner should always perform their due diligence on any potential investment. We strongly recommend consulting with your personal financial advisers and tax professionals about the potential ramifications of investments you are considering, including those pertaining to tax-deferred accounts and capital gains tax. It is difficult for individual investors to keep up to date with all the statutes that have regulated securities industry transactions in recent years, so having experienced pro advisers work for you is essential. When you educate yourself, choose a good team of professionals, and diversify your retirement portfolio, you are well on the way to protecting your assets and assuring your future.
Create a Plan to Build Wealth
CamaPlan was founded by investors, for investors. At CamaPlan, we believe that investors should have the flexibility to use their self-directed IRAs to build wealth their own way. Part of protecting your assets is to create a strategic plan for growth. It is critical that the savings used to fund your self-directed IRA do more than stagnate in an account earning minimal returns. Your money needs to be working hard for you, so that when you are done working, you will be able to retire comfortably. The true benefit of self-directed retirement plans is that they can be used for so many types of investments. Why should you be limited to the narrow variety of stocks, bonds, and mutual funds offered by most brokerage houses when there is such a diverse range of investment opportunities available? Our role at CamaPlan is to handle the required IRS reporting and provide you with the investor education that will empower you to take charge of your own finances. Call us today to open a CamaPlan self-directed IRA, and learn how to protect your retirement assets while building wealth.
When it comes to protecting assets, CamaPlan takes risk seriously and so should you!