Sep 19

Why Should You Open a Self-Directed Roth IRA?

Tax-Free Investing: The primary advantage of using a Self-Directed Roth IRA LLC to make investments is that all income and gains associated with the Roth IRA investment grow tax-free and will not be subject to tax upon withdrawal or distribution. This is because unlike traditional IRAs, you are generally not subject to any tax upon taking Roth IRA distributions once you reach the age of 59 1/2.

Investment Options: With the Self-Directed Roth IRA LLC, you can invest in almost any type of investment, including real estate, private business entities, tax liens, precious metals and commercial paper tax-free!

Diversification: With the Self-Directed Roth IRA LLC, you can invest in almost any type of investment, including real estate, allowing you to diversify and better protect your retirement portfolio.

“Checkbook Control”: With a Self-Directed Roth IRA LLC, you have even more advantages, including what’s called “checkbook control”. As manager of the Self-Directed IRA LLC you will have the ability to make IRA investments without seeking the consent of a custodian. Instead, all decisions are truly yours.

Access: With a Self-Directed Roth IRA LLC, you will have direct access to your IRA funds allowing you to make an investment quickly and efficiently. There is no need to obtain approvals from your custodian, or deal with time delays in awaiting approval from your custodian, or pay any review fees.

Speed: With a Self-Directed Roth IRA LLC, when you find an investment that you want to make with your IRA funds, simply write a check or wire the funds straight from your Self-Directed Roth IRA LLC bank account to make the investment. The Self-Directed Roth IRA LLC allows you to eliminate the delays associated with an IRA custodian, enabling you to act quickly when the right investment opportunity presents itself.

Lower fees: Another advantage to a Self-Directed Roth IRA LLC account is that you can save a lot of money on custodian fees. With the “checkbook control” Self-Directed Roth IRA LLC structure, you will not be required to seek custodian approval when making IRA investments allowing you to eliminate custodian transaction fees and account valuation fees.

Limited Liability: By using a Self-Directed Roth IRA LLC with “Checkbook Control”, your Roth IRA will benefit from the limited liability protection afforded by using an LLC. By using an LLC, all your Roth IRA assets held outside the LLC will be shielded from attack. This is especially important in the case of Roth IRA real estate investments where many state statutes impose an extended statute of limitation for claims arising from defects in the design or construction of improvements to real estate.

Asset & Creditor Protection: By using a Self-Directed Roth IRA LLC with “Checkbook Control”, the Roth IRA holder’s Roth IRA will be protected for up to $1 million in the case of personal bankruptcy. In addition, most states will shield a Self-Directed Roth IRA from creditors attack against the Roth IRA holder outside of bankruptcy. Therefore, by using a Self-Directed Roth IRA LLC, the Roth IRA will be generally protected against creditor attack against the Roth IRA holder.

Self-Directed Roth IRA LLC Structure

To view a diagram of the Self-Directed IRA LLC structure, please select the image below.

Self Directed IRA LLC

 

Please contact one of our IRA Experts at 800-472-0646 for more information.

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Feb 23

Check Out Our Roth IRA Calculator to Understand the Power of Tax Free Investing

The primary advantage of using a Self-Directed Roth IRA LLC to make investments is that all income and gains associated with the Roth IRA investment grow tax-free and will not be subject to tax upon withdrawal or distribution. This is because unlike traditional IRAs, you are generally not subject to any tax upon taking Roth IRA distributions once you reach the age of 59 1/2. In general, the longer the time period, the more advantageous the Roth IRA is because of the powerful advantages of compounding.

Check Out Our Roth IRA Calculator to Understand the Power of Tax Free InvestingOne of the most important determinants impacting how large your retirement can get is the length of time you let your savings grow. The reason for this is that the effects of compounding can become a very powerful tool. Unlike a Traditional IRA, income and gains generated from a Self-Directed Roth IRA grow tax-free. In contrast, income and gains generated by a traditional Self-Directed IRA are only deferred, as taxes must be paid upon distribution, which are vulnerable to future increases in tax rates. The power of tax-free compounding can best be viewed by way of example: Assume Joe, who is thirty years old, decided to start a Self-Directed Roth IRA. Joe had a current Roth IRA balance of zero at that time. Assume Joe decided to make annual Roth IRA contributions of just $3500 each year until he reached the retirement age of 70. Further assume that Joe was able to generate an average annualized rate of return of 9% and the prevailing tax rate was 25%. At age $70 with a Roth IRA, Joe would have $1,289.022 tax-free in his Self-Directed Roth IRA. In contrast, if invested outside of a retirement account, assuming a 25% tax rate, the individual would have just $699,475. Hence, the Self-Directed Roth IRA allowed the individual to accumulate an additional $589,547 of wealth.

Americans love to spend and hate to save. Americans have one of the lowest savings rates for developed countries. Americans are the ultimate consumers and that definitely plays a role. Most people don’t understand the basic concepts of retirement planning and how crucial it is, largely because they’re not widely taught in our high schools or even our colleges and universities. For example, if young workers were shown that if they began funding a self-directed Roth IRA with $3,000 per year at age 20 and continue on through age 65, they will wind up with $2.5 million at retirement (assuming they earn the long-run annual compound growth rate in stocks, which was 9.88 percent from 1926 to 2011). Not a bad result for investing only $3,000 a year.

Calculate Your Self-Directed Roth IRA LLC Plan Contributions Please click here to see for yourself how little it requires to become a millionaire upon retirement by using a Self-Directed Roth IRA:

Saving just $10 a day can make you a millionaire when you retire.

Start saving with a Self-Directed Roth IRA and you will be rolling in money when you retire.  For more information, please contact us at 800.472.0646.

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