I imagine the majority of U.S. citizens have heard of an IRA. I also imagine that most have not heard of a self-directed IRA. A self-directed IRA gives you the ability to invest in non-traditional investments. In all reality though a self-directed IRA is the same thing as a regular IRA. Because they are the same thing and the only real difference is what your custodian allows I wanted to explain a few things that you need to know about an IRA that you may have not known.
You Can Invest In So Much More
Most IRA accounts are invested into stocks and bonds, but they don’t have to be. What most of you don’t know is that a self-directed IRA is really just a custodian (Morgan Stanley, Merrill Lynch, Wells Fargo, Etc) that allows you to take full advantage of your IRA and invest how you want with you. Most custodians only allow for certain types of investments, like stocks and bonds. Why is that? More than likely it is because they make more money by pushing other investments. Or it could simply be because it is not in their wheelhouse. The truth is though with an IRA you can invest in just about anything. You can invest in real estate, gold or even private placements.
You Can Pay For College With An IRA
You can without penalty withdrawal funds from your IRA to cover the cost of tuition. There are a few issues to be aware of when doing this though and that is why it is important to talk to a tax attorney or CPA when dealing with this.
Whether this information is new to you or not you can gain from this knowledge. What you can gain from this is that you can do more with your IRA than you probably are doing. If that means using your funds for things like education or if it means investing in things other than stocks and bonds. You can find a way to maximize your IRA for what works for you.
Author: Nick Barker