Archive for May, 2015

Do you want more Investment Options Inside Your 401K? If so, A Self Directed 401k is for you.

Monday, May 11th, 2015

Self directed 401k

Most employer-sponsored 401(k) plans in existence today permit employees to invest only in a limited selection of mutual funds or similar securities. The dismal returns in the stock market over the past several years have caused many people to question the utility of such retirement investments. While many don’t realize there is something else that is available to you that offers far more than a typifcal 401(k) account. A Self Directed 401k is a great option for those wanting more than just a typical selection of mutual funds or similar securities. With your Self Directed 401k (one.K plan), you are finally able to make nontraditional investments while enjoying the great benefits of a 401(k) plan.

  1. What you can do with a Self Directed 401k (one.KTM plan)

The main benefit to a Self Directed 401k is that it offers the ability to invest in a wide range of investments. Some of the investments you can invest in are:

  • Purchase real estate
  • Loan to yourself or others
  • Buying or starting a business
  • Use purchase options on real estate
  • Flip properties
  • License intellectual properties
  1. What you can’t do with a Self Directed 401k (one.KTM plan)

Like an IRA, there are certain transactions that are prohibited. The rules, stated simply, do not permit “self-dealing.” You cannot interact personally with your 401(k) account in such a way that you or your 401(k) account can benefit directly or indirectly. Naturally, as the owner of the account, you have a right to direct its investments and you will therefore receive an incidental benefit as a future retirement account beneficiary. But that is the only benefit you can receive from your investments.

For example, you cannot loan money to your account nor receive a personal loan from your account (other than participant loans). It doesn’t matter that the terms are commercially reasonable. The problem is that there could be a conflict of interest in the transaction itself. In other words, if your account loans you all of its funds and you then default, there would be an obvious conflict of interest in you (acting on behalf of your account) trying to “collect against yourself.” The same concept applies to certain family members. Your spouse, your lineal ancestors (parent, grandparents, but not mother/father-in-law), your lineal descendants (children, grandchildren, but not nieces/nephews), and the spouses of your lineal descendants are all considered “disqualified persons” or “parties in interest” and your account cannot transact with any of them for the same reason. The government does not believe you would have your retirement account’s best interest at heart if your 401(k) account needs to collect a bad debt from Grandma or evict your daughter and son-in-law from the house they recently leased from your account’s portfolio!

  1. What is included in setting up a Self Directed 401k?

The following is what Accuplan Benefits Services provides in setting up a Self Directed 401k. If you would like any more information feel free to contact us direct.

  • Creation of 401K plan documents
  • Filing of 401K EIN
  • Favorable determination letter from IRS
  • Complete set of plan documents with all necessary forms and guides
  • Assistance and guidance in 401k rollover of current plan to new self directed plan
  • Assistance and guidance in setup of checking account
  • Unlimited pre and post setup consulting for plan setup and operation

Hopefully you are beginning to see the benefits to a Self Directed 401(k). It really is the same thing as a regular 401k except that you are allowed to invest in more things. If you want to take advantage of investing in real estate, gold or other investments that are outside of the stock markets feel free to contact us today to open an account or to learn more.

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Factors to Help you Decide Between a Roth or Traditional IRA

Friday, May 8th, 2015

Traditional vs Roth

There more than one type of retirement account out there. Most of us have heard of a few of the most important types of retirement accounts, like the Individual Retirement Plan which is more commonly referred to as an IRA. An IRA is one of the most affective ways to save for retirement.

If you are wanting to start saving for your retirement but aren’t quite sure whether a Traditional IRA or Roth IRA is the right choice for you? The following four factors can really help you decide which type of IRA account it right for you.

Factor 1 Age

One of the differences between a Traditional and Roth IRA is when they deliver their tax savings. A Traditional lowers your taxes today while a Roth IRA saves its tax benefit for retirement. This is a big factor in deciding which account is right for you. The closer you are to retirement the more a Traditional IRA makes sense. Those who are younger have a lot longer to accumulate monies in their IRA and thus can have tax savings on a lot more money.

Factor 2 Income

Your income is a super important factor in deciding between a Traditional or Roth IRA. Depending on how much you earn, you might not have a choice as to whether a Traditional or Roth is better for you because as of 2014, you can’t use a Roth IRA if you are single and earn more than $129,000 or married and earn more than $191,000 as a couple.

Factor 3 Access to the money

If you are concerned about needing the money in your IRA before you reach retirement then there are some things to be aware of. Because an IRA is a retirement plan, the money should stay in the account until you turn 59 1/2. Generally if you wanted to take money out of any IRA account you could owe income tax plus an extra 10% penalty on the withdrawal. While we could talk about some of the special situations that allow you to avoid the penalty we will leave that for another time.
While there are these restrictions the Roth IRA still gives you some extra access to your money. Since taxes and penalty only apply to pre-tax income you can take out all of your contributions in a Roth IRA and not owe anything to the IRS. It is only when you take out your investment gains that tax and penalty apply. All things considered here, a Traditional IRA is much more restrictive when it comes to taking out money and you’ll be hit with much more fees and taxes.

Factor 4 Retirement tax rate

One of the last factors to think about is your expected tax rate while in retirement. Do you plan on staying in the same tax rate during retirement or do you foresee it dropping?

If you expect to be in the same or higher, then a Roth IRA makes more sense. If you expect to be in a lower tax bracket, the Traditional IRA makes more sense. This can be a lot harder to know and because of this shouldn’t be one of your top factors when deciding between a Traditional or Roth. If you do happen to foresee a lot higher bracket in retirement then a Roth is more sensible. If you foresee a lower tax bracket then a Traditional is more sensible.

These are some of the most common factors to think about when deciding between the two types of IRA accounts. One great thing about self-directed IRAs is that you can have either a Traditional Self-Directed IRA or Roth Self-Directed IRA. At Accuplan Benefits Services we can help set up your account in minutes to get you investing in non-traditional assets.

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Take Advantage of the Rising Crowdfunding Trend with a Self-Directed IRA

Monday, May 4th, 2015

Crowdfunding Is A Growing Trend

An IRA and 401k are one of, if not the best way, to save and invest for your retirement. An IRA and 401k are not something you actually invest in but are a tool that allows you to invest tax free for retirement. As most of you already know this you are probably trying wanting to know more about some of the best types of investments inside of an IRA or 401k. As we have discussed in length before an IRA or 401k can invest in many other things besides stocks and bonds. Typically when investing in things other than stocks and bonds you’ll need to find an investment firm who allows for self-directed IRAs and self-directed 401ks. These types of IRA and 401k accounts allow for just about any type of investment.

Some of the most popular types of investments inside of a self-directed IRA and 401k is real estate and gold. While these have been some of the most popular types of investments inside of IRAs and 401ks there is a newer type of investment that is starting to catch on. This new type of investment is called crowdfunding.

What is crowdfunding? Crowdfunding is the practice of funding a project or venture by raising money from a large number of people. This is typically done through the internet. The JOBS act, is a law intended to encourage funding of U.S. small business by easing various securities regulations. The JOBS act is what propelled crowdfunding to what it is today.

The JOBS acts has certain restrictions to protect investors. One certain restriction states that in order to be an investor looking for private equity, you have to be a credited investor. A credited investor is an investor who has a net worth of $1 million dollars or more, not including home property value.

It has been nearly impossible for the general public to invest in companies in exchange for private equity in the company simply because they were not considered a credited investor.

There is now good news for non-accredited investors. Title III to the JOBS Act will allow non-accredited investors to invest and participate online in start-up business and private firms. This law is not currently in place but when the future is very bright for those who are non-accredited investors.

According to the following chart you will see that crowdfunding is a trend that is on the rise. This year the crowdfunding industry is poised to to have the best year ever. This is great for investors looking to invest with their retirement accounts because it is possible to invest in some sort of crowdfunded investment with a self-directed IRA. This is also good because it means that there will be many more options available than ever before and it doesn’t look like it will be slowing down either.

If crowdfunding is something you are interested in and you want more information as to how it works with a self-directed IRA then contact us today. As self-directed IRA experts we do everything we can to make investing with your self-directed IRA hassle free and enjoyable.

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Don’t be like the Majority Of us, Start Today and Plan for your Retirement

Friday, May 1st, 2015

Plan For Your Retirement Today

As would typically be imagined, finances are one of the biggest concerns that we have throughout life. Wondering about everyday bills and how they will be paid can be nerve-racking. We often time worry so much about today that we forget to think of tomorrow or even next week. It is important to stay current with our financial situation but it is also important to look ahead at where we want and need to be financially.

The biggest example of looking ahead and planning for our financial future is with our retirement. We should take a moment to think about our financial future in regards to our retirement plans. Are we currently on track to have the retirement we want and need to have?

When you actually start thinking about these questions It can be overwhelming to try and figure this all out. You may not know where to start or how to figure out what your goals should be. If you want to start planning for your retirement on your own then check out our retirement guide. If you’d rather not do it alone then you should contact a retirement financial adviser. Meeting with a qualified professional retirement adviser can make a huge difference as they can help bring clarity to your retirement picture.

According to a recent poll conducted for the indexed annuity leadership council surveyed 3,017 adults 605 that were retirees and 1,664 who are employed.

Of those employed 45% plan to retire before age 67; 18% plan to retire at 67; 21% plan to work until 70.

What are some of the reasons mentioned as to why they will stay working in retirement? 56% of employed adults say they will have to keep working for financial reasons; 45% simply want to stay active; 34% enjoy working; 32% want to get more benefits.

Maybe one of the most shocking results is that over half of those who were polled say they have never spoken to a financial adviser.

Yikes, what a bad statistic. It tells me that we simply aren’t planning well enough for retirement. It is a huge stage in our lives and if we simply enter that stage without any planning we are bound to have things go wrong, especially with our nest egg. It is highly unlikely that any of us will have enough of a retirement nest egg to last us our whole retirement if we don’t save and plan for our retirement. Talking to a retirement professional is just one of the steps to helping secure a retirement that you can actually live on and feel secure in.

While there are plenty of other things you can do to help take more control of your retirement more than anything we want to instill in you the need to plan for your retirement. We want retirement to be a great thing for each of us and the more you plan the more likely you will arrive at retirement ready for whatever comes your way during retirement.

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