Self Directed Ira Custodians

Written by Johnny Kitchens
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A self-directed IRA is simply one in which the IRA owner has directional control over what types of investments will be made and when. The custodian of such an IRA can be almost completely detached from the process (which is not always the best idea) or can be an active partner in the decision-making process. IRAs are subject to stringent guidelines and if the proper protocols are not met the IRA can be subject to severe penalties and fees.

To avoid such penalties, you should take great care in whom you choose to be the custodian-advisor for your account. He or she should be knowledgeable of the regulations concerning the type of investing you want to do with your IRA. There are certain rules that apply to IRAs across the board but when it comes to specific investments, the rules can apply differently. Failure to comply with all pertinent regulations has no legal excuse.

There are many types of investments that almost require that your account be self-directed in order to participate in them. Many large, traditional, IRA providers (like banks and mutual fund companies) do not allow IRAs they administrate to participate in real estate deals for example. In order to take advantage of such non-traditional IRA investment opportunities, you will need to talk to smaller brokers or self-directed IRA specialists.

Protecting Your Self-Directed IRA

Protecting your self-directed IRA from penalties and fees is ultimately your responsibility. Your choice of custodians will go a long way towards ensuring you have the best advice and oversight when making your investment decisions. Unless you have a strong handle on all of the rules regarding non-traditional IRA investing, you should pick an excellent advisor and then listen to his or her advice.


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