Self-Directed IRA

Before the Self-Directed IRA: A Preparer’s Checklist

Are you ready for a Self-Directed IRA? Then like a pilot prepping for takeoff, you will need a plan—a checklist. The good news is that this checklist is not as complicated as a flight plan and you can get be off the runway much faster than you think. But it still helps to know the specific steps to ensure that you launch your Self-Directed IRA the right way:

Your Funding Method for the Self-Directed IRA

First things first: do you know how you are going to fund your Self-Directed IRA? Nothing’s going to happen unless money moves through this account. And the way you fund the Self-Directed IRA can have a dramatic effect on its overall momentum and value to you long-term.

Here are some funding methods for you to consider:

  • Indirect Rollover: Funds distributed from a qualified existing account (like a 401(k)), paid to the client, and then put into the new account within 60 days. Because the money does not move from A to B without being in the investor’s hands first, this is called “indirect.”
  • Direct rollover: Rolling over funds from a 401(k) to an IRA is the most direct method of funding, and typical for someone who may have an existing 401(k) from a previous employer.
  • Transfer: This is typically for people who already have IRAs but want to move them across custodians. It’s a very direct way of funding an IRA, but usually not available for new investors.
  • Contributions: If you do not have an existing retirement account, the only way you can put funds into the IRA is to make contributions. Even at the start, your contributions will be limited by the IRS, depending on the specific rules of the account type.

Select a Self-Directed IRA Custodian

You will have to know what your desired strategy is before choosing an IRA custodian. Why? Because not every custodian is alike. There may be some with limited offerings, or who only try to work within certain areas. That’s why it’s important for you to know what your goals are before choosing.

You should also have a look at the custodian’s track record. Have they worked with lots of investors like you before? Do they have a history that you can examine, or are they relatively new?

Try to pay attention to the level of service as well. When you reach out to a custodian, how are your queries handled? Do you feel pressured like you are being met with a sales pitch, or do you feel like a true equal? These little signs can mean a lot when it comes to the ultimate quality of your relationship moving forward.

Set your Vision for Your Self-Directed IRA

Before you complete your new Self-Directed IRA, it helps to have a clear vision of what you want to achieve. Do you know what investments you plan on focusing on? Do you have a timetable for your retirement—even if you are only 25 and decades away from retirement? Do you want to “catch up” and use a higher income later in life to make up for lost time?

Although the principles remain the same, everyone’s retirement strategy is different. That’s why it’s vital that you go about setting up your first Self-Directed IRA in a way that’s purposeful and thorough. Stick to this checklist, of course, but make sure that you keep the ball rolling. Know what your vision is and research the best ways to achieve it.

Interested in learning more about Self-Directed IRAs?  Contact American IRA, LLC at 866-7500-IRA (472) for a free consultation.  Download our free guides or visit us online at

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