Making Your IRA Work For You

Irs publication 590

In addition to traditional investing, the simplicity of using a self directed IRA means you can directly purchase investments on your terms as you discover new opportunities to grow your retirement accounts. With that freedom, you can use your retirement savings to fund real estate deals, purchase a business, or to amass traditional stocks, bonds and mutual funds. To better understand the guidelines and potential opportunities, you may want to consult IRA custodians that can help navigate different opportunities.

There is an enormous range of options when investing through self directed IRA accounts. The main restrictions only prohibit investing in S corps, life insurance and collectibles for most IRA types. Understanding the self directed IRA rules will allow you to better invest and to realize substantial returns if managed properly. For example, a growing number of investors choose to invest in real estate for the opportunity to earn significant monthly returns and the relative security of liquid assets. The real estate IRA rules exclude property that you live in, or that would be used by yourself and a spouse essentially, but otherwise you have substantial freedom in choosing properties to focus on. Using an IRA custodian with real estate experience can help you navigate the complexities of purchasing rental properties using your self directed IRAs.

Some investors opt to purchase a small business using funds from various IRA types. While any venture can be a risky proposition, the immediacy of a self directed IRA provides the ability to grow your holdings considerably and to realize solid monthly returns. When looking at investing in a new or active business, you will have to weigh the time commitment in addition to any financial obligations. For some, it might represent the perfect way to switch careers and to increase their retirement savings, but you will have to weigh all options.

Your level of risk will dictate how you decide to invest your funds and what level of operational overhead you are comfortable undertaking. However you decide to invest your retirement funds, performing due diligence may help you eliminate risk, while providing you with opportunities for future wealth.

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