During the third installment of the HyperFast Wealth segment of the HyperFast Agent Podcast, Dan Lesniak and Sunil Saxena speak with Jack Kiley, Principal at Mid-Atlantic IRA, about using self-directed IRA plans to unlock your retirement funds. This episode will show you a great way to explore a wider spectrum of investment possibilities.
Episode Highlights:
- Most people don't hear about self-directed IRAs because most of the huge financial institutions have co-opted the retirement investment. People naturally think those are the only investments available.
- Real estate is a great investment for self-directed accounts.
- True self-direction offers a wider spectrum of investment possibilities.
- Generally, the motivation for keeping you invested in traditional ways is because the financial institutions get paid that way.
- Self-direction gives you the ability to invest in things that you know more about.
- Jack has a client that only invests in one street.
- The paperwork is fairly simple. There are three main pieces of paper. First there's the application, then the fee disclosure form, and then a transfer form.
- The first thing to understand is that self-direction is just a marketing term that means you can invest in anything permissible by law.
- To move money, the money has to come from another qualified IRA. Like accounts move to like accounts.
- You can't move 401k money until you have a break in service.
- Consult an advisor before establishing an IRA or a solo 401k.
- A traditional IRA will allow you to deduct $6k in a given year.
- Your business could also sponsor an SEP that would allow you to put away 25%.
- There's also a simple IRA which is halfway between an SEP and a 401k.
- If you have no employees, you can have a solo 401k.
- People can contribute directly to a self-directed account. Contribution limits are the same.
- Buying and lending to real estate are very common with Jack's clients.
- By definition, an IRA is a trust, which means it can hold assets.
- You can't invest in collectibles or life insurance with a self-directed IRA.
- What self-direction allows you to do is to leverage your knowledge and your ability.
- Typically these are the types of things entrepreneurs are interested in doing.
- Risk really depends upon your knowledge of the subject.
- Jack provides an example of a large animal vet investing in alpacas.
- You either have to have personal knowledge of what you're investing in or trusted people who are helping you place your money.
3 Key Points:
- Self-direction gives you the ability to invest in things that you know more about.
- You can't invest in collectibles or life insurance with a self-directed IRA. Aside from those categories, there are many investment possibilities.
- You either have to have personal knowledge of what you're investing in or trusted people who are helping you place your money.
Resources Mentioned:
- Learn more about Hyperfast Academy; HyperFast Wealth
- Dan Lesniak bio, Facebook, Twitter
- Sunil Saxena LinkedIn
- John “Jack” Kiley website, phone: (240) 575-3880 ext: 201