Gold 401K

Here is a brief look at the IRA rules concerning valid investments. It appears that a lot of people are not getting the most accurate IRA information, because instead of earning high returns, their accounts are actually losing money, making their future look a little less bright than it could. Let me give you some things to think about.

Under the IRA rules there are some assets that cannot be held within the account; collectibles and life insurance policies, for example. However, there is a long list of assets that are allowed. It’s just that most custodial companies limit their client’s options to stocks, mutual funds, bonds and bank CDs.

You see, the IRS specifically states that custodians may impose their own policies that go above and beyond the IRA rules imposed by the federal government. That statement gives the custodial companies a lot of control and that’s why about 95% of all account holders have incomplete IRA information.

Only about 5% of all retirement investors go the self-directed route. While all custodians allow their clients to make choices, the choices are very limited. In a truly self-directed account, investors are allowed to choose options like real estate, tax liens, mortgage notes, structured settlements and anything else that is a legal option. Do you have any idea what kind of difference that could make? Let me give you an example.

Suppose your account was managed by a traditional custodial company and one of the stock options that they offered was GM. Ten years ago, you checked the box next to the GM stock and “let it ride”, along with some other stock market options. In 2007, the value of 100 shares of the GM stock was around $3600. At the time of this writing, 11-11-2008, 100 shares of GM stock are worth $285. That’s a 92% loss.

That’s an extreme example of how not having enough IRA information can ruin your chances of retiring. Traditional and Roth account holders were limited to a $4000 contribution in 2007. Imagine if someone had taken their entire annual contribution for 2007 and put it in GM.

Using the traditional IRA information, the average account holder “only” lost about 20% over the last year. Other investors have seen lower monthly earnings because of the economic turn-down, but they have not seen a loss, because they are invested in “real” property.

Under the IRA rules, we are allowed to invest in real estate; houses, raw land, warehouses, apartment complexes, etc. I was just reading a few clients success stories and thought I would share a few of the highlights:

o From $5500 to $55,000 in one year

o From $55,000 to $900,000 in less than four years

o From $150,000 to $500,000 in three years

Those who got complete IRA information are looking forward to bright futures. They expect their retirement to be some of the best years of their lives. You can get started by learning more about the IRA rules and real estate investing, in general. Good luck!

Visit my website today to learn more about IRA investing.

Ed Gosselin is an advocate of socially conscious real estate investing as a way of diversifying your portfolio, while maximizing your returns. To learn more on how you can obtain maximum returns on your IRAs, 401ks and other retirement assets, visit my website http://higher-ira-returns.com now.

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