I’ve just started hearing about these… now I just need something to invest!
What is a Self Directed IRA?
Self Directed IRA is an IRA that allows you to choose your own
investments. Your current IRA provider will probably tell you that you
can choose your own investments — “Oh sure, you can choose between the
Janus Fund and the Fidelity Fund.” No, that’s not what I’m talking
about. With a real Self Directed IRA, you can invest in not only stocks
and mutual funds but also real estate, businesses, notes, and just
about anything you want, as long as you avoid certain prohibited transactions.
Prohibited transactions are simply transactions where you use the money
to benefit yourself instead of your IRA, but it’s important to read and
understand the details.
So if you’re tired of losing money in
the stock market and getting jerked around by self serving mutual fund
managers, a Self Directed IRA is the way to go.
You can easily
convert a non Self Directed IRA into a Self Directed IRA. You can also
convert a 401K, if you have one sitting around from a former employer.
If you have a 401K with a current employer, you probably don’t want to
convert it to an IRA, since you would no longer get matching funds.