Precious metals are a popular investment option due to their security. When the stock market crashes, the price of precious metals tends to soar. But the industry is also rife with scammers and dishonest salesmen. It's important to find a precious metals dealer that will give you an honest option.
IRA Financial Group is a common choice by people who want to create a self-directed IRA. Unlike many gold IRA providers, they don't just specialize in precious metals. So what exactly do they offer? And are they actually legitimate?
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About IRA Financial Group
IRA Financial Group has been in the business of self-directed IRAs since 2010. It was created by a group of tax lawyers who wanted to make self-directed IRAs more accessible to the public. While they're not the biggest firm in terms of staffing, they are one of the largest in the US in terms of assets managed.
In fact, almost $5 billion in customer retirement funds are managed by the company. The main investment offerings are real estate and precious metals. Both of these can be held in a self-directed IRA as long as they comply with IRS regulations, but they can't be held in a traditional IRA.
The company states that their mission is to help connect people to investments. They allow individuals to create more diverse retirement accounts, even if those individuals don't come from a strong finance background.
Precious metals and real estate might be their main focuses, but they aren't the only investment options offered. You can also invest in private business stocks, cryptocurrency, and other alternative assets not eligible for a traditional IRA.
One of their most popular services is the checkbook IRA. Basically, they will create a limited liability corporation and enter it into your IRA. This corporation will have a checkbook. You can then use the checkbook to purchase assets for the "corporation," which can then be stored in your IRA.
Self-Directed Account Options
Rather than working with a range of entities, this company focuses on working with individual investors. There are three types of solution available. The standard self-directed IRA is great for any investor. The solo 401(k) plan works well for those who are self-employed. And the ROBS solution is tailored to those who want to start their own business.
Self-Directed IRA
The self-directed IRA is the most popular account opened with the company. This type of account can hold alternative assets that aren't eligible for traditional accounts. However, your assets do need to comply with IRS regulations. Since IRA Financial Group is run by a group of tax lawyers, they help with compliance.
A self-directed IRA does not have an investment manager like traditional IRAs do. Instead, you have full control over exactly what you put in the account. The assets and diversification are both up to you.
There are two options for your self-directed IRA.
The first is a standard setup. IRA Financial Group will act as your custodian. When you want to purchase assets for the account, you will need to have the custodian facilitate the transaction. This is significantly less expensive than the second option.
The second option is for a checkbook IRA. This involves complicated tax paperwork to create an LLC that is held inside the account itself. The LLC comes with a checkbook. You can use that checkbook to purchase assets directly without needing to go through the custodian.
While it is legal, this type of IRA might be vulnerable to compliance issues if you aren't careful about what you buy. It also costs significantly more to set up, since there's a lot more paperwork to be done.
Solo 401(k)
Many self-employed people aren't aware of just how many retirement options are available to them. One option is a solo 401(k). This account lets you get the maximum tax deductions while still investing in alternative assets. In addition, since you're the trustee for this account, you can make investment choices without going through your custodian.
With a solo 401(k), you can contribute a maximum of $61,000 per year. When you reach the age of 50, that maximum increases to $67,500. You can borrow thousands of dollars from the account when need be,