Opening A Self-Directed IRA

Who's In Charge Here?
The government created the IRA program as a way for Americans to put aside money for their retirement years. But Uncle Sam didn't want you gambling your savings on highly risky ventures. While all investments carry some element of risk, their aim was to insure that your hard-earned nest egg would end up in a relatively safe place. Most IRA plans are administered by third party custodians, who bear some responsibility for the growth of your retirement money. As a result, each IRA fund custodian is allowed to apply his own rules and restrictions concerning investment options.

An IRA That Lets You Be The Boss
But individuals have always had the option of creating a Self-Directed IRA - one in which they could assume full responsibility for their investments, and act as their own custodian.

Of course, there are still restrictions on the kinds of investment you can make, even in an SDIRA. So you still won't be able to sink your last dollar into your brother-in-law's latest get-rich-quick scheme. But the investment choices open to you are much wider.

An SDIRA Broadens Your Investment Horizons
While you can still own stocks, bonds and mutual funds, your SDIRA will also let you buy real estate, tax liens, judgments and other financial vehicles (as well as start a business or lend your money, just like a bank). And... just like a standard IRA, any profits you earn from a self-directed IRA are tax deferred - profits from the sale of your real estate, positive cash flow from rentals, business profits, interest on money lent or tax liens. All of it can flow back to your IRA tax free or tax deferred.

Setting Up Your SDIRA
There are a few forms to fill out in order to set up your SDIRA and move funds into it - about the same effort as needed to open a checking account.

Our Resources page lists several companies than can help with this and one in particular that we recommend.