Self-Directed IRAs Can Provide a Solution for Alternative Investment Seekers

January 17, 2019
By Millennium Trust
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As we face a growing retirement crisis, Americans are looking for more ways to save. Participating in an employer-sponsored plan and investing in traditional assets, like stocks, bonds and mutual funds, is a common way to save for retirement, but is that enough?

In addition to employer-sponsored plans, like 401(k)s, self-directed IRAs are another option to help you utilize tax-advantaged structures to invest in different ways.

What is a self-directed IRA?

Let’s start with the basics. A self-directed IRA is not significantly different than any other IRA, but it is unique because it allows you to select the investments yourself and includes the ability to invest in a wide range of investment types – not just traditional assets. Essentially, the ability to invest in alternatives through your IRA, such as real estate or private equity, is the main differentiator of a self-directed IRA. A self-directed IRA can still be either a Traditional or Roth IRA.

Many custodians who offer IRAs, such as larger banks, typically offer only the ability to hold traditional assets in your IRA. Custodians like Millennium Trust offer you the ability to hold alternative investments in your IRA, as well as traditional assets.

What are the benefits of investing in your self-directed IRA?

Self-directed IRAs can provide a variety of benefits for investors, particularly in comparison to employer-sponsored plans. Some of these benefits include:

  • Full control over the account

  • Opportunity to diversify your portfolio with alternative investments

  • Tax-free growth of investments

  • Potential to qualify for yearly tax-deductions

Custodians provide professional experience and service for your IRA, and at Millennium Trust, we have unique expertise in the custody of alternative assets.

What types of alternative assets can you invest in?

Investing in alternatives can add layers of diversification to your portfolio to protect against market volatility. On the Millennium Alternative Investment Network® (MAIN®) you can discover, research and invest in a wide range of asset classes in your self-directed IRA, including:

  • Private equity/debt

  • Marketplace lending

  • Real estate

  • Managed futures

  • Precious metals

  • Multi-strategy

Who should consider opening a self-directed IRA?

Self-directed IRAs are not for everyone, but if you are someone who wants to diversify your portfolio outside of stocks, bonds and mutual funds, it could be right for you.

Work with your advisor to determine what best meets your investment goals, and save for the retirement you want. Also, be sure to research your custodian, the types of assets you can invest in and the associated rules and IRS regulations.

Our self-directed IRAs give you the control and flexibility you need to manage your own diversified portfolio of both traditional and alternative assets. Learn more about opening a self-directed IRA today.

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The material in this blog is presented for informational purposes only. Millennium Trust Company performs the duties of a directed custodian, and as such does not sell investments or provide investment, legal or tax advice. Millennium Trust does not undertake any due diligence for you, including on the Platforms listed on MAIN, their prospective investments or any other investment you may select. The inclusion of any Platform on MAIN in no way represents an endorsement or recommendation of the Platform or its investment options. The Platforms and investment options on MAIN are not a complete list of investment providers or investments that you may choose to hold in your Millennium Trust account, and are provided for informational purposes only.

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