Retirement Planning 2015: Why You Should Consider Self-Directed IRAs

By now, even the most inexperienced investor has heard about self-directed IRAs.

These accounts have become well known and widely used among individuals who want to control their own retirement funds and decisions. After all, who is better qualified to secure a successful future for yourself than you are?

If you are not already self-directing your account, Advanta IRA urges you to learn more about self-direction and to resolve to become more involved in your retirement planning in 2015. You can do this by learning more about the potential of self-directed IRAs, alternative investments permissible in these accounts, and then begin controlling your own retirement destiny. The following information provides you with the knowledge to make that resolution and be successful in sticking to it.

Self-directed plans provide critical diversity in your retirement portfolio. These accounts allow you to control your own funds. However, they also offer the freedom for you to invest outside the hard lines and restrictions of traditional investment broker offerings. Self-directed IRAs provide the unique ability to acquire alternative investments to build retirement wealth that may garner higher returns at a potentially faster pace than standard stocks, bonds, CDs, and mutual funds.

As you are reviewing the success (or failures) of your investments accounts over the past year, Advanta IRA encourages you to consider self-directing an IRA or like account. Why? Because we believe that knowledge is power, control is key, and diversity is essential to the ultimate success of every retirement portfolio.

Knowledge is power when choosing alternative investments.

The more you personally know and understand the assets in your retirement savings plans, the better your chances of being able to invest in opportunities that can potentially build greater wealth in these accounts.

Alternative investments offer a wide variety of choices:

  • Real estate (single and multi-family homes, commercial and rental properties, rehabs, improved and unimproved land)
  • Private lending options (notes and mortgages)
  • Precious metals (gold, silver, palladium, and platinum)
  • Private placements, private stock, and crowdfunding opportunities
  • Single member LLCs (checkbook control)
  • Foreign exchange and futures trading
  • Oil, gas, cattle and timber options; accounts receivable; tax liens and deeds
  • And much, much more…

Advanta IRA neither gives investment advice nor do we sell investments. We do provide cutting-edge technology and educational events designed to arm you with the knowledge to confidently invest your funds in areas and at a pace you are comfortable with. View our event calendar to register for our complimentary nationwide webinars or to find and attend a seminar near you.

Control is key in successfully managing your own retirement income growth.

Advanta IRA is a retirement plan administrator serving clients across the nation who hold over $700 million in assets in self-directed IRAs. We provide unsurpassed personal service in the administration of your plans with us. We ensure all elements of the administration of your account(s) are performed properly and in compliance with Internal Revenue Service rules and regulations. We file reports on your behalf, issue statements, and help you follow contribution limits and permissible transaction guidelines.

By having Advanta IRA handle the tedious administrative tasks, you are able to focus on the more important undertaking of identifying promising investments to add to your portfolio. You gain the value of having the time to choose your own investments and to perform sometimes exhaustive but necessary due diligence to ensure the potentially viability your chosen assets present. You have total and complete control over your own investment funds and decisions.

Diversity is essential to the health and success of your retirement portfolio.

Not only do alternative investments provide diversity, but different types of self-directed accounts do, as well. Learning about the different retirement plans available, along with their qualifications and benefits can help you decide which account best fits your needs.

Retirement plans that can be self-directed:

>>Traditional IRAs: individual retirement arrangements that allow pre-tax savings for most investors. Tax is paid once you reach retirement age and begin taking distributions. You are able to fund a traditional IRA by rolling over funds from another IRA, employer plan or pension plan.  You may also make allowed annual contributions on a pre-tax basis.

>>Roth IRAs: Contributions are made after tax, but the earnings grow on a tax-free basis provided that certain requirements are met. In most instances, the amounts you have contributed may be withdrawn at any age with no tax liability. When you reach the age of 59 ? years and the Roth account has been funded for at least five years, you can take tax-free withdrawals of both contributions and earnings.

>>Simplified Employee Pension Plans (SEP IRA): These are low-cost, easy plans utilized by the self-employed, partners, and owners of corporations. Employers and employees, if any, make contributions to individual, traditional IRAs owned by the employees, established at institutions of their choice.  All employees must receive the same benefits, and are taxed at ordinary income tax rates when distributions are taken after the participant reaches the age of 59 ? years.

>>Savings Incentive Match Plan for Employers (SIMPLE IRA): A plan designed for small employers (including self-employed individuals) to offer employees. (The term “employee” includes a self-employed individual who receives earned income.) This arrangement is typical of salary reduction, wherein the employee elects to defer a percentage of compensation, before taxation, each pay period into the account. The employer contributes the salary deferral, along with a matching amount on behalf of the employee. Contributions and earnings in this plan are not taxed until withdrawn.

>>Individual(k) Plan: A profit-sharing plan with a 401(k) option, but less complicated and not as costly as a traditional 401(k). The types of businesses that can establish an individual(k) include corporations, partnerships, and sole proprietorships. This plan is a good fit if you have no employees or if you are a business where you and your spouse are the only employees with compensation in excess of $100,000. In 2006, the Roth 401(k) was introduced, allowing you to make the salary deferral contributions on a post-tax basis and place them into a tax-free account similar to a Roth IRA. Profit-sharing contributions are still considered a pre-tax contribution.

For each of the plans outlined above, there are eligibility requirements, varying yearly contribution limits, and distribution rules. You can find additional information about these accounts by visiting the self-directed plans section on our web site. It is important that you consult with a trusted tax or financial professional to determine which retirement plan best fits your current situation and needs.

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About Jack Callahan

Jack proudly earned his bachelor’s degree in finance and multinational business from Florida State University and his law degree from the University of Florida College of Law. He established Advanta IRA in 2003 and has steadily nurtured and grown the company and the team every year since. Prior to founding Advanta IRA, Jack delivered specialized counsel to real estate investors, small business owners, and real estate professionals on tax, legal and financial matters. As an industry expert, Jack is a frequent speaker on self-directed retirement plans. He is an accredited continuing education instructor for the Florida and Georgia Bar Associations, Florida and Georgia Real Estate Commissions, and The American Institute of Certified Public Accountants.