Use a self-directed IRA for real estate investments

Diversify your investment portfolio: Use a self-directed IRA for real estate investments

Investment professionals always advise to diversify your portfolio. The current dramatically fluctuating market conditions are an excellent example of why to do so! Real estate in Boulder County has historically been an outstanding investment, outperforming most US markets. Some people think real estate investments are inherently risky. But with planning and forethought, over time a Boulder County real estate investment may yield the largest returns in one’s portfolio.

Why use a self-directed IRA to purchase real estate
Self-directed IRAs offer the ideal opportunity for those looking to invest in rental real estate. News to many is that real estate can be held in an IRA or 401(k) accounts in the same manner as traditional securities. Furthermore, yielded income will bear those same tax advantages.
Also consider this: In a real estate purchase you can leverage 65% of the value of the property. You can’t do that with stocks or gold bullion!

A self-directed IRA real estate purchase cannot be used for “self-dealing,” i.e. buying land or property for you (the owner) or your family members to reside in, or as part of business dealings. But it is ideal for residential or commercial rental property purchases.

Self-directed IRAs help you invest for retirement
With employer-provided 401(k)s and other retirement plans, you don’t have the option to choose where your funds will be invested, which reduces your control over the returns. Investing your savings in property now will add up to major gains by the time you reach retirement age, due to our incredible local market gains and compounding interest.

Picking the right self-directed IRA to meet your real estate investment goals
Not every self-directed IRA will allow you to make investments in real estate, so it’s important to review this option before you pick one. Choosing the right custodian for your IRA is also as important as picking the right account type, since they can help you invest IRA in alternative assets of your choosing. A knowledgeable Realtor can connect you with trusted providers of IRA accounts, help you locate a suitable property, finalize the deal and help you through the closing.

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