A Self-Directed IRA (individual retirement account) is the oldest and most common type of retirement plan. It may be opened by an individual who has earned income and wants to set aside a portion for retirement on a tax-deferred basis.

Deferring taxes means no taxes are levied on all your savings account’s earnings; your dividends, interest payments, or capital gains can compound each year without tax deductions until distribution. You can contribute to your Self-Directed traditional IRA until you are 73 years of age and only pay income taxes on your savings when you make withdrawals in your retirement.

Add these benefits to the advantages of a Self-Directed IRA, and you enjoy direct access to your retirement account’s funds. It allows you to make investments without securing approvals or sending money to your account custodian. Moreover, reliable Self-Directed IRA services enable you to invest tax-free in real estate, precious metals, stocks, tax liens, and other investment vehicles.

Start a tax-advantaged self-directed account today and build a solid, profitable portfolio tomorrow

If you’re still not convinced starting an Self-Directed IRA (individual retirement account) is the best move for you, here are some considerations to can help you decide.

Your Current Contributions Can Be Tax Deductible

Self-Directed IRA contributions can generally be deducted from your taxable income. This deductibility is determined by your income level and whether or not you are covered by a 401(k) or another workplace retirement plan. If you are qualified to make partially or fully deductible contributions, it’s best to seize the opportunity to start a Self-Directed IRA today and reap its benefits in your retirement.

Your Anticipate Your Tax Rate at Retirement To Be Lower

Since withdrawals from a Self-Directed IRA will be taxed at retirement, creating one is a smart move if you expect to be in the same tax bracket (or lower) in the future. This allows you to enjoy the enhanced compound growth of your investments.

You Need a Tax Deduction

Since you are making contributions on a pre-tax basis, funding your IRA lets you lower your tax obligations while growing your savings simultaneously. For example, if you contribute $6,000 to your individual retirement account, you can deduct that amount from your taxable income.

This is different from Roth IRAs, which take a post-tax approach and allow individuals to enjoy tax-free withdrawals in the future.

You Are Looking for More Investment Options

Various Self-Directed IRA alternative investments are available today, and hiring Self-Directed IRA services gives you access to these options. Besides conventional assets like stocks and bonds, you can diversify your portfolio with real estate, a business partnership, or precious metals.

You Are Not Eligible for a Roth IRA

Not everyone is qualified to open a Roth IRA as it has specific income limitations. If your earnings exceed those limits, a traditional individual retirement account may be the best for your unique situation.

You Want to Maximize Your Savings

As mentioned, you can use your Self-Directed IRA for real estate, precious metals, or other investments of your choice. More importantly, traditional IRA accounts also let you make contributions even if your income exceeds the earning limit. While these contributions will no longer be tax-deductible, they can still grow tax-deferred in your account.

Please consult your tax professional for the plan that best suits your individual needs.

Please consult your tax professional for the plan that best suits your individual needs.

A Self-Directed IRA account may be funded with a transfer, a rollover, or a yearly contribution.

An IRA-to-IRA transfer is the most common way to finance this individual retirement account. Meanwhile, rollovers are when the plan participant or IRA holder moves funds from an existing employer plan, such as a 401(k). Finally, contributions can be made yearly, and the chart below shows the annual contribution limits.

If you have earned income and want to save for retirement on a tax-deferred basis, you may contribute to a Self-Directed IRA – Traditional IRA account until you are 73 years of age.

If you are eligible to contribute to an IRA, the amount you can deduct from your taxes will depend on whether you (or, in some cases, your spouse) are an active participant in a retirement plan at work.

In 2022, you can contribute up to 100% of your compensation or a maximum of $6,000 ($7,000 if 50 and over.)

In 2023, you can contribute up to 100% of your compensation or a maximum of $6,500 ($7,500 if 50 and over.)