Many clients already know the benefits and risks of investing in real estate, especially income-producing properties. There are a few key benefits for the investor using an IRA or 401(k). The investors are in total control, they dictate the rate of return, they feel they have less risky investments, and have less anxiety as opposed to the “hope is my strategy” approach.
- The investment gains from that property will go directly back into their IRA or 401(k) on a tax-deferred basis. Every year, the gains will compound or grow in a tax-free environment, which leads to tremendous wealth accumulation over time.
- Successful real estate investors can apply the same great returns they’re getting with their cash investments to their retirement savings plans.
- Many new investors can actually get started in this market by tapping into this money they’ve saved over time. In many cases it allows investors to buy properties they weren’t considering before, especially if they partner their IRA or 401(k) funds with more knowledgeable investors.