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Self Direct

Self Direct Retirement Accounts

Self-Direct Defined

When you self-direct your IRA or your 401K, it simply means that you have complete control over the monies in those accounts—you decide which investments are best-suited for you, and then you “direct” your funds accordingly. The freedom and control are in your hands.

Why Haven’t I Heard About Self-Directing?

It is a little known fact that you can self-direct your retirement portfolio. However, this vehicle has been in effect since the Employee Retirement Income Security Act (ERISA) of 1974 passed the responsibility of retirement saving from the employer to the employee. In 1975, Individual Retirement Accounts (IRAs) were created, providing individuals a chance to direct where their retirement funds are invested.

Only 3% of IRA holders currently use this vehicle. Why?

  • Self-direction places the responsibility in your hands which can be daunting
  • The public finds it too complicated to research and make informed decisions
  • Traditional investment advisers will not recommend self-directing because:
    • They cannot recommend anything outside their approved portfolios
    • They may not be informed or educated enough to make decisions

An unfamiliar term now, self-directed IRA will become a household term as more become wary of the stock market and seek new investment opportunities.

Self-Direct Advantages

  • Diversification
    This is crucial for guarding your investments against economic changes. Self-Direction helps you to diversify your portfolio by giving you the opportunity to take advantage of non-traditional investments, which typically are not connected to stock market activity.
  • Avoid or defer taxes on capital gains

A balanced portfolio allows, you, the investor, to stay abreast of market trends and move money into safe harbor investments (less risk) during market downturns.

What does a well-balanced, diversified portfolio look like?

A balanced portfolio could include some stocks, some mutual funds, some non-traditional investments such as business investments, real estate, and life settlements.

  • You Have Creative Control
    The beauty of self-direction is that it allows you to get creative with your investments. No longer are you restricted by the investment choices of your employer, or by the “approved” investments mandated by your stock brokerage. While it’s still a good idea to heed the advice of professionals, the self-directed investor gains the upper hand by having the ability the quickly maneuver funds based on unexpected market trends.
  • Customization

Based on your age, the current size of your portfolio, or the lifestyle you want to sustain in your later years, we can provide information on the appropriate strategies for your unique needs. Always remember, one investment strategy does not fit all!

The wealthiest people in America have discovered that directing their own investments in non-traditional, unique, and exclusive opportunities can produce great wealth and peace of mind.