If you’re just starting to think about retirement planning, you might be thinking about how much money is in your 401(k) and what kind of investment options are available. But if you’ve been investing for a while—or even if you’re just looking for ways to diversify your portfolio—you should consider putting some or all of your retirement money into a Self-Directed Individual Retirement Account (IRA). If you don’t invest in one, you may miss out on all of the benefits. Here are a few of the things you might miss out on if you don’t consider a Self-Directed IRA:
Your Ability to Broaden Your Investment Portfolio
You might be surprised to learn that a Self-Directed IRA can help you broaden your investment portfolio. In fact, it’s one of the best tools for doing so. Using a Self-Directed IRA will open up access to all sorts of retirement possibilities—which we’ll talk about later.
Most investors rely heavily on stocks and bonds, but what if you have another interest? Maybe you have had your eye on real estate for a long time, or maybe you are interested in alternative asset classes like private equity and precious metals.
With a Self-Directed IRA, those options become open to you. You can now invest in alternative assets with the same tax benefits as the rest of your portfolio. You can use this versatility to diversify your entire portfolio within a single account—which means less risk for you overall. This helps you broaden the range of your retirement portfolio, which spreads your risk across multiple asset classes. This, in turn, can make you more peaceful when you think about your retirement account and how safe it is from the turbulence of the marketplace.
Your Ability to Invest in Alternative Retirement Assets
You can invest in alternative assets, including real estate and private companies. You can have a Roth IRA, a SEP IRA, a Traditional IRA—in fact, you can have whichever accounts you deem appropriate and for which you qualify. You simply add the style of self-directing when you work with a Self-Directed IRA administration firm like American IRA.
You’ll also have more control over the investments you choose to make. The ability to invest in alternative retirement assets is one of the main benefits of a Self-Directed IRA. As opposed to traditional styles of investing IRAs, which allow only certain types of investments (e.g., stocks and bonds), Self-Directed IRAs give you the freedom to invest your contributions however you see fit—even if that includes real estate, precious metals, or other hard-to-find assets.
The Power to Choose Where Your Retirement Money Goes
You can invest in real estate, private businesses, and alternative investments with a Self-Directed IRA. This means that you have the ability to choose where your retirement money goes instead of having it automatically invested in stocks, bonds, mutual funds or CDs. In addition to control and flexibility (you can invest where you want), investing with a Self-Directed IRA offers the ability to diversify your portfolio by adding more alternative assets.
When it comes to your retirement savings, you have a lot of options. And the best part is that those options are only getting better and more diverse as time goes on. So, if you think that a Self-Directed IRA might be right for your retirement needs, don’t hesitate to learn more about how this investment vehicle can help you achieve financial success in the future.