The Five Most Important Factors When Choosing Your Self-Directed IRA Company
by Jim Hitt, American IRA
Y ou’re convinced. You know a Self-Directed IRA is a powerful way to build wealth, using its pro- tections to help you get the most out of investments like real estate. But there’s a catch: you can’t move for- ward unless you have a Self-Direct- ed IRA administration firm in your corner. And you’re not sure which one to pick. How can you tell which Self-Directed IRA company has the experience and know-how to make life easier for you? We’ve put togeth- er a list of the Five most important factors to help you decide. FACTOR#1: TEAMKNOWLEDGE Simply put, a Self-Directed IRA company should know things. A lot of things. You’re working with a Self-Directed IRA company, after all, for a long- term commitment. Shouldn’t you be concerned about who it is that will help educate you? You’d be surprised. Many Self-Di- rected IRA companies have leader- ship and speakers with very limited experience in the asset classes they’re teaching you about. For ex- ample, let’s say you signed up with a Self-Directed IRA company because you wanted to invest in real estate. What if you work with a Self-Directed IRA company whose team knows very little about this asset class?
Do you want to learn from someone who’s reading out of a manual? American IRA’s team is comprised of investors who bring value to you from a place of personal experience. Our ownership AND employees are comprised of individuals who have created a 7-figure net worth by in - vesting in real estate.
checkbook if you use their service, while others will not allow check- book control if you’re going to work with them. But isn’t a Self-Directed IRA all about the freedom to call your own shots? American IRA realizes that every client has different goals and needs. For that reason we employ a hybrid approach to checkbook control. For clients that want to utilize a retire- ment account owned LLC, they can do so. For clients that do not want that structure, it is not mandatory. This gives all clients the tools that allow them to optimize their self-di- rected investments. FACTOR #3: FIRM CONTINUITY—ANDALONG- TERMRELATIONSHIP If you were going to propose to get married and knew there was a chance it would only last a year, would you re-think it? That’s often how it works with Self-Directed IRA administration firms. You’re happy to sign up with one if you know you can work with them for years and even decades. But if you knew that the firm doesn’t have a strong history of continuity, you might rethink things. You may think it a bit strange that we compare a Self-Directed IRA
FACTOR #2: LLCSAND CHECKBOOK CONTROL
LLCs like Single Member LLCs al - low the Self-Directed IRA to put a lot of power in your hands. In essence, a “Checkbook IRA,” as its called, can function much like a personal in- vestment account—with the obvious caveats and regulations of a retire- ment account. With Checkbook Control, an IRA/401(k) is a member of an LLC, which allows the investor to directly transact for their investment. There’s no going through middlemen here. They don’t have to check with their Self-Directed provider for paper- work, or for the flow of money for the account. It’s as simple as writing a check. Is there a catch? Of course. You have to set it up properly. Your Self-Directed IRA adminis- tration firm should allow you to do this. You’ll find that some compa - nies mandate that you have to use a
36 | think realty magazine :: june 2020 2 : : INVESTOR REV I EW
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