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Invest in Real Estate with your IRA or 401(k)

While many people are familiar with Real Estate Investment Trusts (REITS), there are many more options for investing in real estate with your IRA or 401(k). With a self-directed individual retirement account (SDIRA) or 401(k), you can choose to invest in specific investment properties, pool funds with other investors to purchase properties, or invest in income producing debt real estate funds. These strategies could help you to generate larger gains while securing tax benefits.

⌂ The Benefits of a Self-Directed Retirement Account

With a self-directed retirement IRA or 401(k), investors choose how to invest their retirement funds. They are not limited to a pre-set list of common securities such as mutual funds, stocks, or CDs. Self-directed investments could include real estate, private placements, commodities, precious metals, limited partnerships, tax lien certificates, and other alternatives.

Self-directed real estate investments could include rental properties, commercial properties, raw land, and debt funds.

These alternative investments can protect your savings against a volatile stock market and unpredictable economic changes. By diversifying your investments with a SDIRA, you can earn higher returns and accelerate your retirement wealth compared to traditional investments like stocks or bonds.

⌂ How to Transition from a Traditional IRA or 401(k) to a SDIRA

To transition from a traditional IRA or 401(k) to a SDIRA, you can transfer or roll over your retirement from one institution to another. Different rules apply based on account type.

If you have an IRA, you need to do an IRA transfer. Funds or assets are transferred from the custodian institution or trust company to a new one. This is a quick process with no fees, taxes, or penalties.

With a 401(k), you need to roll over your funds to an IRA. This enables you to move your employer-sponsored 401(k) plan to a rollover IRA. This is only an option when you leave your employer and are no longer contributing to the employer-sponsored retirement plan.

⌂ Why Real Estate is a Strong Investment In Today’s Economy