“Let Someone Else Do It”: How a Real Estate IRA is Easily Managed

If you’re like a lot of ordinary investors, the phrase “real estate” scares you a little bit. Real estate is big and expensive—or at least, so goes the refrain. People are worried about having to act as a landlord even in their retirement years. What they don’t realize is that through a little smart planning and through a Real Estate IRA, it’s actually quite easy to keep tabs on your real estate portfolio without direct, hands-on management.

The key point here: in a Real Estate IRA, you hire a property manager to handle unit upkeep, rental income collection, and expenses. Meanwhile, you let your real estate build wealth for your portfolio and you get to collect the profits without lifting even a finger. Sound too good to be true? Here’s how it all works.

What People Don’t Realize about a Real Estate IRA

A retirement account with real estate holdings in it doesn’t have to be a concept only for the rich. In fact, anyone who wants to invest in real estate should consider doing it through an IRA. Consider the many advantages of holding real estate in a retirement account:

  • Non-recourse loans allow you to build up wealth while not risking everything. It’s important to use leverage in acquiring real estate, of course, because that leverage helps you maximize the amount of wealth you’re able to build over the long-term. Non-recourse loans can be helpful for investors because they require lenders to only go after the property in the event of a default, leaving the rest of your property alone. Hopefully it never comes to this, but even if it does, you can rest easy knowing that the rest of your wealth is protected.
  • In a Real Estate IRA, you’re actually expected to stay hands-off. By working with a property manager who handles the day-to-day business of handling your real estate, you don’t have to do anything except keep an eye on profits. The property manager is expected to collect rent, handle expenses, and see to the upkeep of your real estate. You’re required not to personally use the real estate you keep in a Real Estate IRA, further establishing it as a separate investment that has little to do with your day to day finances.

Those two points eliminate most of the worry that many investors have about real estate investing. People worry about risking everything, about losing it all, and worry about the kind of time involved in managing property. By using non-recourse loans and using property managers within a Real Estate IRA, you can rest much, much easier than all that.

Watching Wealth Grow While Someone Else Does the Work

Your investments are meant to put other people to work; that’s what happens when you buy funds from companies that pay fund managers to handle your investments. It’s not all that different when you invest in real estate thanks to the concept of the property manager.

True: a property manager does cost money. But with the right real estate investments, you can collect rental income and watch your property grow with real estate prices. There’s no guarantee that you’ll be a success—there’s no guarantee with any type of investment—but a property manager helps make your real estate feel a lot more like the other hands-off investments you keep.

Call us at 1-866-7500-IRA(472) if you want to learn more about what a Real Estate IRA can do, or simply keep reading here at AmericanIRA.com to learn more about Self-Directed IRAs and their advantages.