Are You Setting up the Right IRA to Reach Your Long Term Goals?

A Self-Directed IRA, also known as an IRA LLC, can provide you with the freedom to invest in precious metals like gold and silver while enjoying the tax deferred umbrella that makes IRAs ideal for setting aside money for retirement.

How Gold and Silver Investments Are Possible within an IRA

Yet investing in the precious metals market is just a sliver of the many investment opportunities that are possible when you are the owner of an IRA LLC.

When you devote your working life to setting aside enough money to begin investing for your retirement, it is smart to decide on an IRA that permits you the chance to grow as much of your money as possible.

You have to ask a broker some sharp questions to know if you are getting a self-directed IRA that will allow you this broad range of investments. While inquiring into an IRA, it’s best to ask to questions to identify whether or not you are getting an IRA that will allow you to put sufficient cash aside for retirement.

Questions to Ask When Shopping to Identify a Truly Self-Directed IRA

First, will the IRA allow you to tap into the profit potential of a variety of investments? Can it, for example, allow you to venture into the gold and silver market?

Second, what are the charges associated with running your account? If there are numerous small fees, you will reduce the amount of money that you can set aside for retirement.

Third, will you get checkbook management? If you do not have the power to manage your own funds, then it’s most likely that you will have to ask the custodian to approve of how you invest the money in your IRA.

Fourth, will you be capable of making timely investments or will there be delays in how fast the funds will be released for your use?

Frankly, only an IRA LLC offers you a constructive answer to these four questions. If you get negative answers, it means that you are being offered a less flexible type of IRA.

Why You Should Consider Getting an IRA LLC?

An IRA LLC gives you full control of your retirement and allows you greater diversity. The plain fact of investing your own money is that nobody is as vigilant about your funds as you are. So shouldn’t you have a say in how your funds are invested and have as much flexibility as possible to diversify? For this reason, whether or not you choose to invest in gold or real estate, a truly self directed IRA gives you the freedom to develop your retirement funds according to your own insights.

Although there are many funding alternatives out there with a checkbook IRA, much more than provided by a standard IRA, there are nonetheless some restrictions on where you are permitted to invest. You still must have a custodian to purchase, fund, and hold your IRA LLC account. The custodian’s main task, other than administrating the legal aspects of your account, will be to ensure that you do not violate any IRS provisions and to annually to report the assets within the account. Without knowing the rules, even out of ignorance, you might invalidate your IRA and face heavy tax penalties. This can occur by purchasing collectibles or undertaking investments that could be classified as self-dealing.

A knowledgeable custodian is not responsible for overseeing your investment management.  They can’t tell you if an investment is worth buying and they can’t offer advice on whether an investment will be profitable. They can however, offer updates to the IRA rules and consultation on what is and what is not permissible within an IRA structure. In the event, they don’t know whether an investment falls within the area prohibited by the IRS, then they will likely direct you to a financial or legal professional that does know. A good rule of thumb is to seek out help before making any investment.

Investing Is a Team Sport Even If Your IRA Is Self Directed

In the end, investing is a team sport and you need a good team to help you answer these questions before pulling the trigger on a self directed investment.

1.    Does a particular investment fall inside or outside of the IRA rules and is it compliant with current IRS code? Generally, your IRA custodian should know this, but if it is in a gray area or the custodian is not sure, then you should seek legal assistance.

2.    Does a particular investment opportunity make sense? Just because you are presented an idea and you have the money to make the investment does not mean you should make it. Here is where you need a number cruncher on your team that thoroughly knows how to read a balance sheet. You should seek the advice of your CPA or attorney.

3.    If you partner with your IRA, then you need to know the tax ramifications prior to making the investment. Check with your CPA or attorney.

4.    If you are considering investing in a company, an opportunity or a real estate project that you know nothing about and especially if you find something online promising high returns, then you should have an attorney review all the documentation before wiring the funds. Make sure to interview everyone you can that is associated with the company and get everything in writing.  Also you should involve your legal counsel. An ounce of prevention is worth more than a pound of cure, especially when you are handling your retirement.

Must read post: Could the tax deferred status of your 401k or IRA be in jeopardy? View our much read post about the plans being discussed by the Ways and Means Committee in Congress. They are now eying your retirement savings accounts to tackle the next bubble or debt crisis created by trillions of dollars of government spending. Could there be another bail out just on the horizon? Don’t think it could affect your 401k or IRA savings. After reading this you might want to think again.  Read here to find out more

This entry was posted in New To Self Directed IRAs. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>