Using Your Self-Directed IRA for Private Real Estate Lending
Unlock Your Retirement Account's Potential
Most Americans have their retirement savings in stocks and mutual funds earning average market returns. But what if your IRA could earn 10-12% fixed returns backed by real estate?
Self-directed IRAs make this possible.
What Is a Self-Directed IRA?
A self-directed IRA (SDIRA) is a retirement account that allows investments beyond traditional stocks, bonds, and mutual funds. With an SDIRA, you can invest in:
- Private lending and notes
- Real estate
- Private equity
- Precious metals
- And more
SDIRA vs. Traditional IRA
| Feature | Traditional IRA | Self-Directed IRA |
|---|---|---|
| Investment Options | Stocks, bonds, mutual funds | Almost anything |
| Custodian | Brokerage (Fidelity, etc.) | SDIRA custodian |
| Control | Limited | Full |
| Returns | Market-dependent | Alternative returns |
Why Use SDIRA for Private Lending?
Tax-Advantaged Returns
Private lending returns of 10-12% become even more powerful in a retirement account:
Traditional SDIRA:
- Returns grow tax-deferred
- Pay taxes on withdrawal in retirement
- Great if you'll be in lower tax bracket
Roth SDIRA:
- Returns grow tax-free
- No taxes on qualified withdrawals
- Ideal for high earners
How to Set Up SDIRA Private Lending
Step 1: Choose a Self-Directed IRA Custodian
Research custodians that specialize in alternative investments:
- Equity Trust Company
- Entrust Group
- Millennium Trust
- Alto IRA
- Rocket Dollar
Step 2: Fund Your SDIRA
You can fund through:
- Rollover: Transfer from existing 401(k) or IRA
- Transfer: Move between IRA custodians
- Contribution: Annual contributions (limits apply)
Step 3: Complete Investment Documentation
Your SDIRA custodian will:
- Review the investment opportunity
- Process subscription documents
- Send funds to the investment
- Hold assets in your IRA's name
Step 4: Receive Returns
Investment returns flow back to your SDIRA:
- Interest payments deposit to your IRA
- Returns compound tax-advantaged
- Reinvest or hold as cash
Invest Your Retirement in Real Estate-Backed Lending
Key Real Estate Capital welcomes self-directed IRA investments:
- 12% fixed annual return
- Capital secured by first-lien real estate
- Professional management
- SDIRA custodian compatible
Contact us to discuss investing your self-directed retirement account with us.
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