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Investing In Real Estate Podcast

This episode of Investing in real estate is sponsored by SimpliSafe. Fear has no place in a place like home: that’s been SimpliSafe’s mission since day one. Protect your home today, and enjoy free shipping on any system order by visiting simplisafe.com/investing.

Have you ever been left frustrated by the lack of control you have over your retirement accounts? If so, a self-directed IRA (also known as an SDIRA) could be what you’re looking for as it allows you to choose your types of investments, instead of letting your custodian choose for you. So when it comes to taking control of your financial future, self-directed IRA rules work in your favor.

On this episode, Natali and I sit down with our self-directed IRA expert, Hayley Neeley. Hayley joins us to help us answer your questions on how to maximize your retirement account! We’ll talk about the finer details of how to invest in real estate with a self-directed IRA, self-directed IRA rules, and how to become truly empowered in your wealth building. Don’t miss this episode of Investing in Real Estate.

On this episode you’ll learn:

  • The difference between a traditional and Roth IRA.
  • Some creative assets you can invest in with a self-directed account.
  • How to determine if your account is truly self-directed.
  • The benefits of self-direction.
  • And much more!

Self-directed IRAs have become a wildly popular choice for retirement savers lately. But we’ve noticed some confusion over the different types of accounts, and what do the self-directed IRA rules mean for you when it comes to paying taxes.

The difference between a traditional and Roth IRA

Retirement seekers weigh up the pros and cons of traditional and a Roth IRA. But really, there isn’t much difference. Ultimately, it depends on what you’re out to achieve. For us, a Roth IRA is the winner. One of the main goals for those looking to profit from real estate in their retirement is to end up in a higher tax bracket, which can happen with a Roth account. And with a Roth, when you retire, your withdrawals won’t be taxed.

Anything that you make in a Roth account grows completely tax-free! If you have a traditional account, you can make the conversion so that you would pay the taxes today to avoid the worry of paying them later down the line. But with a Roth, you’ll be taxed when you withdraw it as income. And If you withdraw it as a Roth you’re not taxed on it, whereas with a traditional IRA you will be taxed in retirement.

This is where our eyes light up with the possibilities of how to make money with a self-directed IRA. Let’s say, you have a Roth with property inside of it and its rental income is flowing – you can then pay the tax on the seed and not the crop. Over the years and years of making rent – you’re not taxed on the crop when you take it out! 

Simply put, multiple years of tenant cash flow goes into your self-directed IRA, when you cash it out at 59 and a half years young – you don’t pay any tax on that rental income. Not bad, right?

Some creative assets you can invest in with a self-directed account

What attracts retirement savers to self-directed IRAs is the flexibility to invest in diverse investments. No longer are you limited to stocks and REITs that traditional brokers push. With a self-directed IRA you can take control of your financial future with investments that excite you. How to make money with a self-directed IRA and build wealth for the future? That’s up to you. 

You can invest in:

  • Real estate (actual real estate, not real estate stocks!)
  • A business
  • Cryptocurrencies 
  • Gold and precious metals
  • And more!

There are multiple ways to set up your self-directed IRA to suit your investment choices and retirement goals. If you’d like to learn more book a call with our team for a FREE consultation to make sure that you’re fully set up to achieve the dream retirement that you want.

How to determine if your account is self-directed

This is an important step as many people get misguided by institutions doing all they can to keep them as customers. Many retirement savers have called their traditional bank and asked to transfer their money to a self-directed IRA after reading a blog like this. Then, their bank/broker will claim that they offer self-directed IRAs too… but they don’t!

Why aren’t they real self-directed accounts? Because, they’ll only let you invest in stocks, bonds or REITs. You’ll instantly know whether you have a legitimate self-directed account or not when you talk about your choice in investments. A real self-directed IRA will let you invest in real estate, precious metals, cryptocurrencies. etc. 

With a self-directed IRA, you’re free to invest in real estate and purchase a property. Now your self-directed IRA owns that address and everything that the property generates is going to flow right back into your retirement account. So, if you’re unsure whether your account is self-directed, ask if you can invest in a property and alternative assets to find out.

The benefits of self-direction accounts

The benefits that attract retirement savers to self-directed are the aforementioned flexibility and freedom that they give you to invest in whatever you want. BUT… as people learn more about them they realize they get even better…

Tax benefits and leverage with self directed IRA rules

Many retirement savers wisely leverage inside of their IRA via non-recourse financing. Let’s say you have 100,000 in your self-directed IRA, you can leverage this as you talk to traditional or non-recourse financing lenders when aiming to purchase a larger asset.

Simply put, you can use the funds inside of your IRA towards a property down-payment – but thanks to the IRA – you have the security of using someone else’s money to make you money. This is asset-based financing that works perfectly with self-directed IRA investments. 

Another plus is that you can legally avoid capital gains taxes inside of a self-directed IRA. So when you eventually sell a property – you’re not responsible for the capital gains taxes. Your self-directed IRA can act like a tax-deferred or tax-free account depending on how its setup.

Safety for first-time real estate investors

People investing in real estate for the first time are understandably cautious. Buying a property with an account that you have instant access to can be unsettling. This is why self-directed IRAs appeal to those entering real estate because they know they can’t touch the account for years to come. This makes retirement savers feel more secure as they begin their real estate journey. 


Retirement savers love the control that a self-directed IRA gives them. They’re no longer told “no you can’t invest in that” or led to place their financial future in options that they don’t believe in. You sit in the driver’s seat with a self-directed IRA: you choose your investments as you plan your path to a wealthy retirement. 

The results that can be achieved with a self-directed IRA are fantastic. And today, they’re incredibly easy to set up! The process has been streamlined over the years as self-directed IRAs have become a go-to tool for retirement savers looking to build wealth.

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Posted on

February 9, 2019

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