The economy’s uncertain, numbers seem to point in opposite directions, and there’s an increased demand for retirement solutions of real, tangible value. The Real Estate IRA has many investors interested, and for good reason. Or, rather—three reasons.
Here are some of the top explanations for investor interest in the art of the Real Estate IRA—and a few tidbits of knowledge that might help you as well:
Generating Income with a Real Estate IRA
Income is a real issue for anyone who wants to retire. If you don’t have an income to live on, then you have to rely on your investments and savings. But if you invest properly, you can have investments generate interest and you can have an income on which to depend.
Real Estate IRAs are ideal for generating an income because they’re essentially an investment in income. If you have a piece of real estate with a tenant, that tenant will continue to pay you rent over a period of time. And if you own that real estate outright, far more of this rent will go straight to your net income and not to your expenses.
For people who want to make sure that they retire more quickly, real estate can be one of the ways in which to accomplish these goals. Real estate allows for a steady cash flow—and since you work through a property manager in a Real Estate IRA, there’s minimal maintenance to be done by the investor themselves.
Capacity for Greater Growth
One of the most important issues people have about retirement is that they want to invest in something that has a large potential to grow. Although you can certainly save up for a nest egg over time if you invest early, not everyone has that opportunity. Some people wait until their 30s, 40s, and even 50s and beyond to start investing in earnest. That means that there are many investors out there looking for options with greater growth potential.
Because you can take out non-recourse loans with a Real Estate IRA, this gives you a certain amount of leverage for making larger purchases than you could otherwise with an IRA. With this larger purchase comes more opportunity for growth; after all, a larger investment tends to have larger fluctuations in value. With this growth come more opportunities for investment as well.
Flexibility and Versatility
One might think of “real estate” as a single field of investments. Not so. Real estate includes an entire swath of different investment types, ranging from single family homes and townhouses to raw land and commercial property. There are plenty of opportunities for expanding your retirement portfolio when you invest in real estate—it doesn’t have to be just one kind of building or one kind of property purchase.
You can use your IRA to invest in all of these different types of real estate, which gives you the flexibility to make an investment that lines up with your experience and your values. There is one caveat, however, to be aware of: you can’t live in a real estate investment which you have through a Real Estate IRA.
Plenty of Options
Investors are interested in owning a Real Estate IRA because it allows them the freedom to live retirement on their terms. Because many investors are looking at real estate anyway, they want to find an option that offers them a tremendous amount of protection.
If you are interested in using a Real Estate IRA to meet your investment goals, contact us at 828-257-4949 and we’ll be glad to speak with you.