Planning for the future, specifically for retirement, is crucial.
The earlier you begin planning, the better off you will be when the time comes.
Whether you’re looking for a steady pool of funds to serve as income replacement, or you’re looking to compound your overall wealth in order to improve quality of life for you and your loved ones, smart investing can help you achieve your goals.
That’s where an IRA can come in handy.
An IRA — or, an Individual Retirement Account — is one of many routes you can take when planning for the future. An IRA allows you to save for retirement by setting aside tax-free money, or on a tax-deferred basis.
But did you know you can use your IRA funds to make other investments?
That’s right. With the Fixed Income Fund from Tactical Wealth, you can use your IRA to earn steady, reliably monthly income with no investor fees, transaction fees, or management fees.
But more on that later.
First, let’s look at the different types of IRA accounts and how you can use your IRA to invest.
What Is An IRA?
An IRA, as we said earlier, is essentially a retirement fund. You can deposit money into your IRA pre-taxes, paying only when you withdraw your money later down the road.
This can be an immensely helpful vehicle for saving money for 10, 20, 30, or 40 years down the road.
For starters, let’s look at the three basic types of IRA accounts, and the different advantages associated with them.
- Traditional IRA: A traditional IRA allows you to make contributions with money that may be tax-deductible on your return. These earnings are contributed on a pre-tax basis, allowing them to grow until you withdraw them at a future date (i.e. retirement). This type of IRA can mean you money is taxed at a lower rate, especially if you find yourself in a lower tax bracket after retiring.
- Roth IRA: This type of IRA allows you to make contributions after tax. While there are certain contingencies to the Roth IRA, this means you can contribute, compound, and withdraw your money tax-free before and after retirement.
- Rollover IRA: Simply put, this is a traditional IRA that allows you to roll over money from another qualified IRA plan. For example, if you had an employee-sponsored retirement plan like a 401k, you could transfer those funds into your Rollover IRA easily.
Using An IRA To Invest
So, why should you get an IRA? Well, simply put, your 401k or other savings plan may not be able to provide you with enough money to last you in retirement.
An IRA can be a helpful way to accumulate the savings you need.
And, to make your options even better, you can use your IRA to invest and make even more money.
What are your options?
Here are just a few:
- Mutual Funds: You can use your IRA to test the waters of the stock market by pooling your money with other investors and handing it over to a mutual fund manager who will choose different stocks, bonds, and other assets. This is a good way to get a diversified portfolio, though be aware that the managers often charge a price for this service and aim for low-risk stocks and bonds that will yield small, safe returns.
- Stocks: Another way to test the the market, you can use your IRA to buy individual stocks. You can do this on your own, or utilize a third-party manager. Here, you are running the risk of tying your money to the success of one company (or several, if you so choose).
- IRA Annuities: Close to investing in the Fixed Income Fund, buying an annuity with your IRA can help you earn residual income after your retirement. However, annuities often have unwieldy high expenses and varying interest rates that can affect your return on investment.
While these are the most common options for using your IRA to invest, they aren’t the only options. You can also use your IRA to:
- Buy Gold: You read that right. Buying gold and silver coins, or even bullion, is one of the more unconventional ways to invest using your iRA. Most banks or other IRA managment parties traditionally don’t offer this as an option, but buying gold coins can be a sometimes safe, albeit low return, way to invest. The cons? You’ll need a custodian to buy, and in many cases store, your precious metals, and they don’t compound interest or pay dividends. Their value is directly tied to the health of the economy.
- Buying Real Estate: This is a tricky, yet viable, option. You’re essentially using your IRA funds to become a landlord, and you’ll need to have enough in your savings to cover not only the initial down payment and mortgage, but also maintenance, taxes, and other fees. Also, you can’t go for this option with a traditional IRA.
- Buy A Business: Looking to invest in a great business idea to help generate revenue in retirement? Well, you can use your IRA for that. Again, while this is a plausible option, it can also be a headache. And, since you’ll likely be investing in a startup, this option is also very risky.
Use Your IRA With The Fixed Income Fund
Still wary about your IRA investment options?
Don’t worry. We’ve saved the best for last.
With the Fixed Income Fund from Tactical Wealth, you can use your IRA, 401K, SEP, and other qualified retirement accounts to generate stable, consistent income.
The Fixed Income Fund makes this happen by buying mortgage and trust deed loans according to strict underwriting criteria, all with a maximum loan-to-value ratio of 70 percent.
We’ll pool your investments with other clients to diversify portfolios, maximize returns, and minimize risks.
Unlike the other options laid out above, with the Fixed Income Fund you can invest your IRA with an easy-to-understand offering with zero fees, a fixed rate that will never fluctuate, and low risk.
You can even let your earnings compound instead of taking monthly distributions.
Interested yet? We thought so.
If you’re looking for a risk averse investment with income greater than you can receive with annuities, bonds, and other investment options, without the need for immediate liquidity, then contact Tactical Wealth today.
With the Fixed Income Fund, you can get peace of mind in retirement.