Tired of Traditional Investments? Try Something New to Build Up Your Self-Directed IRA this Year
Published on February 17, 2015
Unusual investments for self-directed plans
Individuals who want to control their retirement investments through self-direction can include many alternative assets in their retirement plans. Among the more popular of these nontraditional investments are real estate, commodities, precious metals and private placements. But the list of allowed investments is long, varied and may be as unique as the account holders.
For investors who are tired of the same old stocks, bonds and mutual funds, a self-directed IRA can be great way to refresh a retirement portfolio. Some of the more unusual alternative investments that can be included in a self-directed IRA are:
- Bitcoin – The cryptocurrency has yet to grab the imagination of the general public but it is accepted as a payment method by retailers, hotels and others around the world.
- Race cars – Do you love the Indy 500 or the Grand Prix? Are you a NASCAR fan? Why not invest in what you love by including shares of a race car in your self-directed retirement account?
- Race horses – A Thoroughbred race horse is a thing of beauty and a winner’s purse can be quite lucrative. Whether you like the flats or harness racing, a self-directed IRA may include shares in a race horse or racing stable.
- Hogs –According to Bloomberg Markets magazine, lean hogs (the main source of US pork) were the winning investment last year in agricultural commodities. Hogs gained 56.3% in one year, 11.5% annualized over three years.
- Soybean meal – If livestock’s not your thing but you like investing in commodities, check out this ground flour, which had a one-year return of 18.5%, and it outperformed cattle, rice, and lumber.
- Alternative/green energy – Think solar, wind or water to power your self-directed retirement savings.
- Equipment leasing – Your self-directed retirement plan becomes the lessor, in effect.
The list goes on with a few exceptions—most notable are collectibles (such as stamps, coins, artwork, antiques and fine wines), which are prohibited from self-directed retirement plans.
As with all self-directed investments, it is up to the account holder to do all the necessary research about the target asset. The investor works out all the details and the account administrator handles all the transaction process, manages all the paperwork and takes care of all mandatory reporting. At Next Generation Trust Services, we go a few steps further by offering guidance and education to clients about self-direction (we do not, however, give investment advice nor do we endorse any types of investments).
If you are already investing in alternative assets, know and understand them, and want to build a more diverse retirement portfolio, contact our knowledgeable professionals at (888) 857-8058 or Info@NextGenerationTrust.com for a free consultation about self-direction as a retirement strategy; or refresh your investments by opening a new account today!
