Self-Directed IRAs Don’t Have to Be Risky

Self-directed IRAs allow those tired of ordinary investing todabble in alternatives behind the shield of a tax-deferred account.  Although self-directed IRAs may allow peopleto invest they way they want, many people make the mistake of filling them withhigh-risk investments.  These investorshope to pick “enormously successful short-term investments while avoiding taxconsequences.” 

In reality, investorsshould put most of their money in traditional investments and use self-directedIRAs only as a tiny portion of investments. Instead of investing in “exciting” alternatives, investors should useself-directed IRAs to take advantage of tax deferrals and steadily grow theirmoney in very low-fee accounts.

See Mitch Tuchman,Safe Self-Directed IRAs for RetirementInvestors, Forbes, May 28, 2013.