Rethink Your Rollover

Posts Tagged ‘investments’

ira investments real estate

IRA real estate investments are booming in 2008 for soon to be retirees who are worried about their future retirement plans. With the economy looking wobbly, the stock market plunging and the big investment banks going under, with us bailing them out, some traditional forms of retirement investing are starting to look a little sick.

For these reasons IRA real estate investments are increasing. Increasing? Surely not. Along with an economic meltdown, a stock market collapse and all sorts of economic turmoil, isn’t the real estate market headed for oblivion as well? Who in their right mind would consider investing their IRA in real estate?

Surely in 2008 real estate is a one way trip to the poorhouse.

No, not quite. Have you ever heard the expression that there is opportunity in adversity? There is plenty of opportunity in real estate right now, if you know where.

But lets look at ira real estate investing first. How can you invest your IRA in real estate? Is it allowed? Is it legal?

Traditionally the majority of the population invest their IRAs in investments that are promoted to them by their custodian. In fact some custodians limit allowable investments to their own. So, it’s estimated, over 90%, in fact around 96% of IRA funds are invested this way. Mutual funds, CDs and stocks, and so on.

No problem if the markets are pushing ever skyward, but quite a problem right now.

But what about IRA real estate investments? Yes it’s entirely allowed to invest your IRA in real estate through a self directed IRA. Although this is not widely recognised, ira real estate investing is one of the best forms of wealth accumulation for retirement. Real estate is a traditional long term wealth accumulation model, and as such is in fact ideal for IRA investing.

If you’re not certain about the details of how to set yourself up for ira real estate investing consult your CPA, that’s outside the scope of this article. However take my word for it, it’s quite legal, and many canny IRA investors are doing it right now, and have been for a long time. You may need to execute an IRA rollover into a self directed IRA, but the trouble is worth it.

And there’s powerful reasons to consider investing your IRA in real estate. Did you know, for example, that it’s estimated that 85% of all wealth in the US was created through real estate?

And that through your IRA you can secure up to 70% bank non-recourse financing to invest your IRA retirement funds in income producing real estate?

Its food for thought isn’t it?

Now back to the real estate market. After all there’s no point in ira real estate investing if the value of your real estate investment is going down is there?

Although we all hear that the real estate investment market is dreadful this isn’t the whole story. PARTS of the real estate market are dreadful, but not ALL of it. It’s perfectly possible to find excellent opportunities for investing in the lower priced end of the market. Simple comfortable homes for the working class who live in those faceless suburbs in cities right across America. There are some fantastic IRA real estate investments available in the right place RIGHT NOW.

But if you’re looking to get out there and find them yourself then you may be in for a shock. It’s not something that is realistic for the individual IRA real estate investor. You need professional help.

Buy in the wrong place and you’ll probably get burnt, big time.

But right now there are some excellent opportunities available for securing a great real estate investment, no cash down, at under market value, with tenants supplied, rental guarantees and even a guarantee that you will double your current investment return.

All through a major US public corporation with a reputation for solid real estate investment returns, for both ira real estate investing and ordinary credit investing in real estate.

Yes you can secure your retirement future through a good ira real estate investment, or more than one. However it’s the time to leave it to those who really know what they’re doing in hard times, and you can relax and leave the hard work to someone else.

But which corporation could possibly offer an opportunity like this?

About the Author:

Want to know more about profitable ira real estate investing? Visit Peter’s Website Win-Win Real Estate Investments and find out more about no money down real estate investing at http://win-winrealestateinvestments.com/

Source – ira real estate investing When the Going Gets Tough

Private Lending for Real Estate Investing

Roth IRA cds

Question: What should a Roth IRA consist of now with the market in turmoil?

I know people normally do a 60/40 % ratio. So 60 percent goes in mutual funds and 40 percent goes in CDs.

But based on recent events why not establish an IRA and simply put all of the money in short-term CDs?

Are there CDs out there where you can continually add money to them?
So it would be like a savings account but you are guaranteed a certain high interest rate?
Im 19 year old but I don’t want to dump my money into something.

Answer: It depends on your "asset allocation" model which would be built on by looking at your needs, risk tolorence, inflation expectations and years to retirement and a resonable quess at years in retirement.

A 60/40 split rarlely means 40% in CD's. for a 19 year old it should be none at all. Beside a 60/40 at your age would be a terrible idea... it may be way too little to get to your goals. So the answer is an "asset allocation" model.

I believe the last place for retirement money before age 75, is a bank. The next worst place for any retirement money is an insurance company.

Take some time. Learn about this stuff!!!! Start by reading; Mutual Funds For Dummies. It's a whole lot better than getting advice from strangers who don't know you & your needs. Besides you don't know their qualifications or motives.

Personal Investment & Loan Tips : Roth IRA vs. CDs

Roth IRA transfer

Question: Is it possible to transfer current stock shares into a new Roth IRA account?

If I already own some stocks through a personal brokerage account, can I transfer the stocks into a newly opened Roth IRA? If so are there penalties or fees I might incur?

Answer: No, you can only deposit cash. You have to sell your shares first.

Transfer of Funds to SD -- "Trigger" a Distribution of MY Plan?

self directed ira investments

Question: Can a Self directed IRA that has invested in a LLC pay the medical Insurance premiums for the LLC members?

I have an IRA self directed with checkbook control. My only investment is a Real Estate LLC that invests in real estate. There are two members of this LLC. Can the IRA pay their monthly medical premiums since this is an expense for the LLC? Thanks.

Answer: No.

Self-Directed IRA | Real Estate IRA | Guidant Financial Group

ira limits 2005

From my experience in working with seniors, here are the five most offered reasons why people have not purchased long term care. In most cases, the reasons are not valid. It’s not that they don’t make any sense; it is due to lack of information. So here are the big five along with some insights that may cause you to re-think your position.

1. Denial. “I won’t ever need long term care—I’ll never go to a nursing home.”

There are a couple of ways to look at this. First, it is true that about 50% of the population will go to a nursing home at some point—generally at the very end of life. But that also means 50% won’t. It’s a flip of a coin.

Still, 50% is a pretty high chance. If no provisions are made for long term care, a person with little or no assets is up a creek and the person with modest assets could rapidly dissipate their entire estate. So it’s insuring against an unknown, just like other insurance. Do you have fire insurance on your home? How many times has your home burned down?

Consider this: There are a lot more long term care situations than going into a nursing home. You could need home care, adult day care, assisted living or hospice care. These are all long term care variations requiring money.

2. “It’s too expensive.”

It very well might be. You could have health challenges. You could be too old to get a good rate. But you need to think outside the box.

There are a number of things you can do that entail just “moving assets around” that would provide long term care benefits. None of these require an out of pocket premium.

For example, there are insurance companies that will allow you to “exchange” all, or a portion of, a CD, annuity, life insurance policy or IRA for a product that has most of the attributes of the fund transferred and has long term care benefits to boot.

3. “My kids will take care of me.”

Maybe. But pretty much for sure if you live in rural American and it’s the late 1880’s. Today, families are scattered all over the country. As much as this sounds like a good idea on paper, in reality it is hard to pull off without friction somewhere.

4. “I’m a veteran—the VA will take care of me.”

Again, maybe. First, they have to have a bed for you. Remember, there are 70 million Baby Boomers right behind you and it’s all about supply and demand. Economists are already predicting that nursing homes won’t be able to be built fast enough for the general population, much less expanding VA hospitals.

Before you put all your hopes on the VA, I would suggest reading the qualification rules. This is a topic unto itself, but let me give you a couple of examples.

a. In some places, you must have a 70% service-related disability to qualify.

b. For others, the best option may be State Veterans Nursing Homes. These are generally out in the sticks. The VA provides a per diem ($59 a day in 2005) so the vet may have to pay the difference unless a state subsidy for low income veterans is available. There are waiting lists, some as long as two years.

So making the assumption that the VA will take care of you does not put a lock on long term care.

5. Medicare will cover my long term care costs.

Again, this is a complicated topic requiring a detailed explanation. Let me just say here that there are a lot of hoops you have to jump through to even qualify. Second, the benefits are only offered for a limited number of days. On top of that, most people don’t qualify for the maximum number of days.

Several years ago, there was a popular planning technique used for Medicare’s cousin, Medicaid: Give or spend your way into poverty so you could qualify for longer benefits. But now the rules have changed. For example, the powers that be were able to “look back” only three years to see what was given away to reduce your estate to Medicaid’s definition of poverty. Now it’s five years—and not from the time the asset(s) were given away—five years from the “application time.” The equity in your home was previously not taken into the calculation; now it is. If you have more than $500,000 of home equity, you don’t qualify.

So, the bottom line is that Medicare really is not a long term solution for most people.

The point of all this is to encourage you to do more homework if you have offered any of these reasons for not addressing the long term care risk. One of two things is likely to happen. You will discover that what you think would be your solution really isn’t or you will solve the problem by being exposed to a planning technique or product that was previously unknown to you.

About the Author:

Robert D. Cavanaugh, CLU is a 36 year financial and estate planning veteran. The Estate Preservation Advisor provides financial planning information to seniors and those approaching retirement.

Source – Five Excuses People Use for not Buying Long Term Care and Why None of Them Hold Water

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Question: I contributed to my Roth IRA in 2005 and my AGI was over the 150K limit. What are my options?

I filed my taxes before the April 15 deadline, is it too late to recharacterize my 2005 contribution without penality? If not, should I recharacterize now and pay the 6% penalty or not do anything? What are the odds that the IRS will check and penalize me at a later date?

Answer: The truth is you need to recharacterize now and pay the penalty. You will get it again if you don't. It repeats every year until it is fixed.