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How To Invest In Real Estate Using A Self-Directed IRA

Here is one concept everyone learns quickly in retirement: taxes are high, money is short. For many thinking about retirement, they soon realize they’re going to need a bigger pool to swim in, i.e. more money, especially after the government takes its share of the 401k through taxes.

Self-directed IRA’s are a blessing to individuals who want to take their retirement investing in their own hands. Investing in real estate with your IRA allows you to profit tax-free. With tax rates seemingly ever-increasing, and property values going up, now is a great time to invest in real estate with retirement funds.

However, the risks involved & complexity of investing in real estate present a challenge for many individuals looking to get into the game. At Holdfolio, we have revolutionized the real estate investment process. Holdfolio provides an option for individuals to invest alongside real estate investment professionals, and Holdfolio has established a seamless process to complete these investments with your retirement money. Many of Holdfolio’s investors choose to work with The IRA Club to set up their self-directed IRA accounts.

How to Invest Using a Self-Directed IRA

Many people don’t even know Self-Directed IRA’s are an option for their IRA account. This option allows owners to choose their own investments for the plan. In order to open one, an individual must work with a custodian to hold the IRA assets. This company is in charge of the account and paperwork with the IRS. Once your self-directed IRA account is setup, which can be a simple process costing you less than $100, you can invest not only in bonds & financial products, but you can also invest in real-world items like property.
The process is simple. It involves a roll-over from your established 401k or IRA company, to your new custodial account. Once the rollover has been completed you will then be able to purchase real estate. Strict rules must be followed and it is imperative to go along with them or be at risk for losing your IRA.

Pro Tips on the Processes of Investing in Real Estate with a Self-Directed IRA

  1. Find an Eligible Property

You Can NOT Invest In…

  • Personal Residence
  • Second Home
  • Occasional Rental
  • Buying a Property You Already Own

 You CAN Invest In…

  • Property You Newly Purchased
  • Property Purchased Directly Through Your IRA
  • Investing in Properties with Holdfolio
  • Flipping Properties with an Annual Limit
  1. Traditional mortgages are not an option with IRA real estate investments. Therefore, if you don’t have enough money in your IRA to purchase an entire property outright, then the most viable option is to consider investing with a company like Holdfolio.  Holdfolio’s minimum investment creates an opportunity to invest in real estate with as little as $10,000.

Please consult with professionals such as IRA Custodians, CPAs, or your financial planner. We can provide a list of some of the most popular Self-Directed IRA Custodians. A wealth of knowledge regarding self-directed IRA’s can be found on their websites. We encourage you to please contact us should you have any questions.

Ready to invest in real estate?

We make real estate investing simpler, more transparent, and accessible to individual investors.

TJ Lokboj

TJ Lokboj is an entrepreneur with a passion for adding value to the real estate investing industry through adopting digital transformation. Some of TJs companies have been featured in Yahoo Finance, Morningstar, Benzinga, and many other publications.

TJ is the managing partner of Holdfolio, a real estate investment firm that leverages a premier crowdfunding platform.

He is also a member of the Forbes real estate council and co-founded SyndicationPro, which is the #1 syndication management SaaS solution in the market today.

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Ready to invest in real estate?

We make real estate investing simpler, more transparent, and accessible to individual investors.