Retirement Investment

Retirement Savings Options Guide – Understanding Self-Directed Accounts and the Benefits

Several retirement savings options are available for any worker in any industry, including the self-employed. Any retirement account will have its own set of regulations and requirements. Some people turn to self-directed accounts to have more control over their investments.

With the two main types of retirement accounts: Roth and a Traditional 401(k), there are limitations on the types of investments the owner can make. Some laws prevent IRA or Solo 401(k) account owners from using those funds for “alternative investments,” such as life insurance, gemstones, coins, S-Corp stock, collectibles, fine wine, and certain types of real estate.

Any IRA investment that falls under a restricted category may cause an additional 10% tax charge on early distributions. A Solo 401(k) account could even be subject to a penalty on the taxes (around 15%). Many people interested in self-directed retirement savings options want more flexibility with real estate investments.

Suppose you are currently satisfied with your ROTH, Solo 401(k), or other types of traditional retirement account but want to have more control over it. In that case, you can roll it over to a self-directed account offered by an affordable investment platform that will give you that control. You can then use the account funds for a broad range of investments you might not have initially had access to, including real estate, start-ups, and crypto-currencies.

Retirement Savings Options With Fast Transactions

There is an added benefit of fast transactions. When going over retirement savings options and selecting the investments you want to make, you can do so easily without waiting for custodian approval. Regardless of which type of self-directed account you have, there will always be tax advantages, whether deferred taxes or even no taxes on the gains inside the account.

Of course, to get these advantages, you’ll have to choose the right platform for your self-directed account. Important things to look for include transparent pricing, no transaction fees, no asset fees, and a simple setup process. Since online security is so essential these days – especially where personal finances are concerned – look for a SOC-2 certified company that continuously updates its system to ensure the best practices.

If you feel that self-directed retirement savings options are ideal for you, consider going through a platform like Rocket Dollar. It offers transparent pricing such as a one-time setup fee (the entire process is straightforward), affordable monthly pricing, and no requirements for the minimum opening deposit.

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