NUTS & BOLTS UPCLOSE & PERSONAL
Kaaren Hall, founder and CEO of self-directed account administrator uDirect IRA Services
STRATEGIES: REITs ONE-ON-ONE
cash-management side of the fence.
HOW TO DO A LITTLE DIGGING: DUE DILIGENCE ON INVESTMENT PROVIDERS
What can self-directed IRA
investors usually hold in their SDIRAs?
B efore you make any investment, you run the numbers and evaluate the strategy. But do you also conduct a little due diligence on the investment provider? The integrity of your provider is as important as the integrity of your investment strategy, so be sure to do a little digging on that person or company before trusting them with your money. DO A WEB SEARCH Take results with a grain of salt, since many companies pay people to write bad reviews for competitors and others actually engage in a form of blackmail where they post bad reviews and then demand payment from the target company before they will take them down. Don’t be afraid to address any issues directly with the company to gauge their reaction, or seek information in protected forums that screen for paid and false reviews both positive and negative.
KH Different self-directed IRA providers will decide which assets they will and will not custody. Most custodi- ans transact a variety of investments in a variety of asset classes, including real estate, mortgage notes, private equity investments, hard-money loans, and certain qualified types of precious metals and currency. Some more exotic investments require highly specialized custodians, such as bitcoins and racehorses, for example. Some custodians have creative structures in place to permit this or have special resources, or investors use self-directed 401(k)s for that type of investment because the rules for holding exotic investments are differ- ent for 401(k)s. What is the most common mistake you see people make about self-directed IRA administrators and custodians? KH Probably the biggest mistake people make is they forget their self-directed IRA is exactly what the name implies: self-directed. We get so spoiled by our financial advisors. They tell us what to do and where to invest. When you are self-directed, however, TRM
Insider Insight froma Self-DirectedAccount Administrator ONE-ON-ONE WITH KAAREN HALL.
DO A FRAUD CHECK The North American Securities Administrators Association (NASAA) and the Financial Industry Regulatory Authority (FINRA) offer public
information about many investment providers. The Amer- ican Association of Retired Persons (AARP) does as well. Remember that these organizations may not necessarily have comprehensive information or tailor their content to self-directed investors, however, since the majority of Americans do not self-direct and tend to leave their retire- ment in stocks and bonds.
by Carole VanSickle Ellis
eal estate investors love discov- ering new sources of capital to fund their deals, but sometimes getting to that capital can be a little compli- cated. Think Realty Magazine sat down with Kaaren Hall, founder and CEO of self-directed account administrator uDirect IRA Services, to learn more about how real estate investors working with her company leverage and build their retirement capital. R
IRA custodian, and they also often must follow a lot more regulations because they literally take hold, or custody, of the assets that an investor is buying with their IRA as an investment. Self-directed administrators work di- rectly with the account-holders through the processes of opening accounts, funding them, reviewing investments, and other administrative duties. Admin- istrators’ time is not monopolized by the
THINK REALTY MAGAZINE What do self-directed IRA custodians and administrators do?
KAAREN HALL In general, an IRA custodian helps investors begin to save for retirement and then take those dollars and turn them into investments. A self-directed IRA custodian usually permits a lot more types of investments than a conventional
ASK FOR REFERENCES Ask the investment provider for a list of other clients who have worked with them successfully. This is a great way to learn about their methods and daily operations as well as the ultimate return on investment.
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