We’ve all done it…..that crack in the sidewalk that most people would have to intentionally attempt to trip over and still maybe not fall…but, we are the ones who do that trip and are always embarrassed over it. When we trip on the crack, we look at the crack as if it jumped up and knocked us over when no one was looking.
The same can happen with our self-directed IRA and 401K plans. While the IRS rules related to what qualified retirement accounts cannot do are not difficult concepts to understand, almost like that crack in the sidewalk, they seem to creep up on some people and trip them up. And just like falling over that crack, some of us almost fall and then realize to our own embarrassment that we almost entered into an IRS prohibited transaction without even intending to do so.
So, what are some common scenarios that can “pop” up and trip us all. Let’s look at a few that have been addressed by this author over the last few months. Continue reading
I know BawldGuy has preached about this for years so what I am about to say probably won’t shock anyone, but I couldn’t resist anyways. So, BawldGuy, here’s to you!!
Sooooo, is Wall Street a scam?! Well, actually, while we might believe it is at times, most likely it is not. But, with all the rash of problems in the market that has surfaced and continued to hold high its ugly head over the last couple of years, one does definitely wonder. Since, there are many articles and posts devoted to the woes or Wall Street, let’s take a higher road and just provide some good, basic education to those of us who are interested in protecting, nurturing and growing OUR retirement accounts. Continue reading
I recently received a call from an upset individual who was claiming that he thought he was taken advantage of by a company that had established his self-directed IRA and was administering the IRA under IRS rules. Please note -– this company did not do anything illegal in any way.
This individual….who we will call Jeff…thought that he had done extensive research, selected the company of choice to hold his IRA and was quite sure he understood the fee structure of this IRA custodian. In fact, what led Jeff to be so upset and to turn on his computer and Google some more key words was not the excessive fees he was paying to the custodian to hold his IRA — but rather a very small, tiny “fee” that made him grind his teeth. Continue reading
Written By — John Park
Many of us remember our first “dive” into the municipal swimming pool or lake. Once we overcame the trepidation of diving head first into the expansive body of water, did we dive in completely or just halfway???
The same is true with self-directing your retirement assets. While your plan must be established and continually adhere with all IRS and, if applicable, Department of Labor regulations, the code in no way prevents a fiduciary (e.g., you, yes it can be you) from controlling all aspects of the plan.
This is true provided the fiduciary is not “self-dealing”, which is expressly prohibited. A fiduciary can only act in the best interests of the retirement plan, and may not personally benefit. Continue reading
Individuals have many choices from whom to solicit assistance in establishing a self-directed IRA or 401K. Typically, the prospective client looks at three types of company structures to assist them in their efforts to self-direct: custodians, administrators and facilitators. Of these three, custodians and administrators are, to the naked eye, almost identical in function. However, both are very much different than the facilitator. Many individuals will employ the services of a custodian and administrator because they incorrectly believe that these firms actually look out for their best interests and ensure that the client does not enter into a prohibited transaction with the self-directed investment.
Nothing could be further from the truth!! Continue reading