Take the Fear Out of Your Retirement Formula – Include Alternative Assets in a Self-Directed IRA Instead!

Published on August 5, 2014

When is enough, enough? When it comes to retirement savings, many Americans are gripped with fear that they haven’t saved enough. In fact, according to a recent Gallup poll, it tops their list of concerns about financial matters, with a firm majority of Americans (59%) worried about not having enough money for retirement.

In good economic times and bad, Americans have been “very” or “moderately” worried about retirement savings every year since 2001. Perhaps it is because the three-legged retirement stool–Social Security, individual savings and employer-sponsored pensions—is getting too wobbly to place retirement dreams on.

If you are tired of living in fear as retirement looms on the horizon, here are some simple steps you can take to prepare for the retirement life you want with more confidence:

Downsize. Reduce your spend. Weigh whether you need those luxury items or every day incidentals that can add up over time. Consider moving now to smaller digs rather than waiting for retirement, and save on taxes, utility costs and insurance dollars. This is all money that can be socked away into retirement savings.

Roll over orphaned 401(k) plans. If you’ve changed jobs, you may still have money in a former employer’s 401(k) plan, which you can roll over into a new IRA. Consolidating your retirement savings in one place gives you a better idea of how much money you have and a line of sight into your investment portfolio performance as a whole.

Don’t borrow from your 401(k). Reducing the funds in your 401(k) will have an adverse affect on the compounding magic of a retirement investment because the dollar amount that gets compounded on will be lower. Plus, there are loan expenses such as origination, administration and maintenance fees as well as the interest you must pay to repay the loan (or the penalty you pay if you do not replace those funds).

Consider alternative investment options. In a world of wobbly three-legged retirement stools, it may be worthwhile to examine nontraditional investment options such as real estate, mortgages, unsecured loans, private hedge funds, precious metals, limited partnerships, commercial paper and more. This is especially true of individuals who might already be making these investments outside of their existing IRA; they can open a self-directed IRA and make these investments with the same tax advantages that a retirement plan provides.

Investors who want to have a stable and secure retirement know that a self-directed IRA can be a great way to build retirement wealth more boldly with alternative assets. With a self-directed retirement plan, informed investors have the ability to develop a diversified portfolio that they control, with both traditional and nontraditional assets they know and understand.

Next Generation Trust Services, a self-directed IRA administrator, handles all the details of the transactions and manages all the paperwork and filing. Our professionals are available to answer questions about self-directed retirement plans and our transaction specialists ensure our clients are investing within IRS guidelines. Since we do not give investment advice, we strongly recommend you consult your trusted financial advisors about your investments and any tax implications they have for your unique situation.

Take the fear out of retirement and control your future, today. Contact Next Generation at (888) 857-8058 or Info@NextGenerationTrust.com to learn how. Or, read through our Starter Kits for more information.