As Americans live longer, we will have to rely more on our retirement savings. We know we can’t count on Social Security to give us the standard of living we desire.
Even with this common knowledge, most of us only make plans for the immediate future. We set up lofty goals like running a marathon, writing a novel, climbing a mountain, losing the extra pounds, and more. The amazing part is that some of us even achieve those goals. Yet when it comes to our retirement, we have almost no concrete plans.
Building a million-dollar retirement account is not complicated. All you need is an understanding of the problem and the patience to set up some simple solutions. Hopefully, you are ready to invest your time to achieve a better future today.
Retirement Saving Challenges
Saving for retirement requires discipline. It is important to understand the obstacles that can stop you from making progress.
Lack of Action: The Great Recession, stagnating wages, and the wildly fluctuating stock market have created a situation where people lack confidence in saving for retirement. Many Americans are worried about having enough funds when they retire. Yet according to a Financial Times report, 45% households don’t have any retirement plans.
Lack of Control: People who are investing in qualified retirements plans don’t understand the returns they are getting. They don’t know if they can reach their goals using those accounts.
Lack of Diversification: Risk mitigation is an important strategy to ensure retirement gains in the long term. Diversifying assets is an important way of achieving this goal. However, most people are only depending on stocks, bonds, and mutual funds. They are missing out on opportunities to invest in alternative assets like real estate, precious metals, private placements, and more.
Antidote to Retirement Saving Challenges
- Open an IRA account: The time is right now. If you don’t have a qualified retirement account, you should open an Individual Retirement Arrangement (IRA) account today. Then set up a goal and create a plan to achieve that goal. It is the first step to achieving your dream retirement.
- Learn more: Knowledge is power. With thousands of resources available online, there is no excuse to not learn about the available options. Start here at the IRS page.
- Find alternatives: Once you have mastered the basics about retirement investment, try to figure what alternatives can help you achieve your goals. You don’t need to depend on traditional institutions to invest for you. You can take advantage of self-directed IRAs to get more out of your savings.
A Self-Directed IRA can help you achieve your million-dollar retirement dream. It is one of the most efficient ways to save money for retirement. If you are excited about this often overlooked option, here is a primer to get you started.
What is Self-Directed IRA?
A Self-directed IRA allows you to take control of your investments. With a traditional retirement plan, you are restricted to stocks and bonds. With Self-Directed IRAs, you can invest in partnerships, real estate, commodities, mortgages, notes, and more. It opens up more opportunities to diversify your portfolio.
Benefits
- Gain access to alternative assets not offered by traditional banks and brokerage firms.
- Invest in what you understand. If you are an expert in real estate, you can invest in properties in your area.
- Use commodities to protect against market fluctuations
- More control over your own investments.
Reasons for Using Self-Directed IRAs – Tax Benefits Revealed!
Real estate is the most popular reason for moving to Self-Directed IRAs. You can enjoy Tax-Differed/Tax-Free Profits. You can get better gains than stocks and bonds.
However, your alternative investments don’t have to end there. You will have options to invest in private equity and stocks, limited liability companies (LLCs), futures trading, hedge funds, foreign exchanges, commodities, crowdfunded opportunities, livestock, timberlands, and more.
With all these options, you can mix and match to create your perfect concoction of investment magic.
Types of IRAs
Deciding on the type of IRA to use is an important financial decision. So it is critical to have an understanding of the available options:
- Traditional IRA: Tax-deferred retirement savings account. Compounds interest from dividends, interest payments, and capital gains help build significant savings.
- Roth IRA: Tax-free retirement account with the option to fund with after-tax dollars. Deposits can grow tax-free. No penalty for early withdrawal.
- SEP IRA: Tax-deferred retirement savings for self-employed and small-business owners. Contributions tax-deductible until withdrawn.
- Simple IRA: Tax differed tax match plans for employees.
- Rollover IRA: IRA accounts for people with multiple employers. You can move your 401(k) to a Rollover IRA.
- Self-employed 401(k): Individual 401(k) plan funded with after-tax dollars. Useful for sole proprietors with no employees.
Options to be aware of:
- Educations Savings Account (ESA): Tax sheltered cash for qualified education costs.
- Health Savings Plan (HSA): Tax-advantaged medical savings account for medical emergencies.
Taking the Leap with Self-Directed IRA – Big Returns and Tax Savings
Self-Directed Retirement plans give you the ability to have more granular control over your portfolio. It gives you the ability to cushion yourself against the ups and downs of the stock market. So it makes sense to use it as a tool to improve your chances to get a better return on your investments. With a self-directed IRA, it is possible to build a million-dollar retirement fund. So, don’t delay. Start today.
Finding Trusted Resources
To get the best results, find a reputable administrator. An administrator with the right experience can help you with your journey. You can look into local directories and talk to different parties to see if you are a good fit.
Identify the following compatibilities:
- Experience: Inquire about the track record of the administrator to ensure you are working with someone who can meet your needs.
- Fees: Prices can differ widely between different services. So make sure you have an agreement over the fee structure. Self-directed retirement plan administrators provide you with more extensive service for alternative investments. So expect to pay more than traditional IRA.
- Expertise: Find out if the administrator has the necessary knowledge in your particular area of investment. If you are a real-estate investor, it doesn’t make sense to hire someone with private equity expertise.
- BBB rating: The Better Business Bureau (BBB) ratings can be a valuable resource in finding out the reputation of a potential hire.
Conclusion
With a Self-Directed IRA, you gain power over your investment portfolio. It can help you get started in achieving your dream to earn a million-dollar retirement plan. Don’t delay. Talk to an expert today.
If you have any questions, please feel free to ask in the comments section.
Authored by Tracy Stein – CEO & President of Prime Pinnacle Investments
Toll Free: 855-387-7463
Email: TracyStein@PrimePinnacle.com
