Q: How are the European Union, Presidential policies, and High Frequency Traders connected?
A: While you can’t control them, these factors can greatly influence the stock market, making it unpredictable and not ideal for your retirement savings.
If you’re like most Americans, your retirement savings are probably in a regular IRA or 401(k) handled by reputable companies like Vanguard or Fidelity. These companies are trustworthy, but the retirement plans they offer are tied to stock market performance, which can be stressful to monitor. The constant ups and downs, driven by political actions and trading practices, can make it nerve-wracking to watch your retirement savings fluctuate, even with a reputable provider.
So, what can you do instead? One option is to move your retirement funds away from Wall Street and into assets you know better. Maybe you’re knowledgeable about local real estate, have expertise in a specific industry, or believe in precious metals as a safe bet during economic troubles. For these scenarios, a Self Directed IRA could be your solution.
A Self Directed IRA allows you to choose specific assets for your retirement portfolio and invest in them as you see fit. There are two main types: Custodian and Checkbook Control. With a Custodian setup, a custodian holds your retirement savings and handles all investments and transactions, but this can mean high fees, lots of paperwork, and delays. On the other hand, with Checkbook Control, you manage your funds through a checking account at a bank of your choice, eliminating middlemen, paperwork, delays, and extra fees. This Checkbook Control model is quickly becoming more popular in the self-directed sector.
For self-employed individuals, there’s a similar option called the Solo 401(k). It works much like the IRA, offering Checkbook Control and various investment choices. Additionally, it allows for personal loans up to $50,000 and higher annual contributions. Even a small amount of self-employment income can qualify you for a Solo 401(k).
No matter which path you choose, remember that managing a self-directed IRA isn’t just about picking a few stocks and forgetting about them. It requires active involvement to grow your funds and secure your financial future. The key is to invest in areas you understand and manage your money yourself. Essentially, you’re building your own financial success.
Broad Financial specializes in Self Directed IRAs and Solo 401(k)s with Checkbook Control and can be reached at 800.395.5200.