A guest post from Sensei Gilliland, Founder of Black Belt Investors
Investing in real estate is one of the great options you have with a self-directed IRA or 401k. This can include buying rental properties, funding flips, investing in mortgage notes, private lending, and investing in real estate businesses. No matter how you invest there are substantial tax and wealth preservation advantages of using these vehicles. But, before you do be sure to address the following checklist…
Determine Real Benefits with Your Accountant
Considering the average tax rate in the U.S. is around 31%, there is clearly serious savings and wealth building advantages from investing in real estate through a vehicle which allows you to accumulate tax deferred or tax free returns. However, be sure to consult your tax professional to determine the exact breaks and benefits for you personally. Ensure that you have a plan for the year which will fully optimize your finances.
Vet Your SDIRA Provider
With billions in wealth ripe to be rolled over to self-directed accounts, and rising awareness of these options to protect more earnings and investment capital with them, there are more service providers trying to step into this space too. Take a moment to vet potential providers. How long have they been in business? How much experience do they have in managing sizable amounts of assets? What kind of experience have your peers had in dealing with this company so far?
Decide Your Priorities
When choosing an IRA custodian decide what your priorities are in advance. Do you want a service provider with the most gimmicks, or the one that will offer the best protection from the tax man?
Have an Investment Lined Up
Your money should never site idle. Strive to keep your money constantly in play with as little down time as possible. Line up investments in advance and stay on top of the process of setting up, or rolling over your retirement fund to a self-directed account.
Invest in Line with Your Retirement Needs
SDIRAs offer a lot of flexibility in investment choices, even just among real estate options. Be sure to invest in line with your retirement needs. Don’t get too distracted. Is passive income your main goal? Or do you need to build up wealth to secure more passive income streams later? Which investments work best with your timeline?
About Sensei Gilliland: Founder of Black Belt Investors; Sensei Gilliland has been featured on the cover of Real Estate Wealth Magazine, and has engineered several highly popular trademarked real estate investment systems.