With the recent stock market volatility, which seemed to come
out of nowhere, one begins to wonder what to do with retirement money invested
in stocks. There is very little choice,
since banks are paying so little interest, “putting it under the mattress”
seems like the only alternative!
Well, there is an alternative, a Self-Directed IRA. Self-directed IRAs are the only retirement
accounts that have the potential of a good return on your investment other than
the stocks, bond or CDs. No surprise, the IRS has imposed rules, but with
proper guidance from a qualified advisor, the option to invest in real estate –
such as single and multi-family homes, condos, commercial property, undeveloped
land, as well as equipment leasing, precious metals, livestock and others.
One of the most important guidelines is that the investment
must be arm’s length. For example, you cannot personally use or benefit from
the real estate in your self-directed IRA.
All expenses and revenues must come from and go directly to the
IRA. Also, you cannot buy and asset or
sell to a disqualified person -a close relative or the custodian or advisor of
the IRA.
If you are thinking about diversifying, you may want to look
into the creation of a self-directed IRA
to invest in real estate or other qualified types of investments. Consult with your tax professional and
retirement advisor – there are very specific rules that must be followed.
To find the best possible investment property
for your self-directed IRA call us at 631-765-5333, or email me at Marie@BeninatiAssociates.com, or visit our office at the corner of Main Road and Horton’s Lane in
Southold. We’re here to help you!
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