Investing in Multifamily with a Self Directed IRA

Have you thought about ways you can leverage past employer investment programs, or other retirement accounts to better fit your goals and family needs?  In 2024, Caleb and I converted a 401K from a previous employer to a self-directed IRA. At the time, I didn’t realize quite the benefits of doing this, but like most things, Caleb was a few steps ahead of me and knew what he was doing.  I knew the advantages of real estate investing but didn’t know our retirement accounts could be self-directed to capitalize in this asset class.  As we made the switch, I learned more about self-directed IRAs, and I hope you learn a few things from this article, too!

Benefits of Self-Directed IRA’s

1.      Unlike an employer retirement account that often has limited conventional investing choices, self-directed IRAs allow YOU to choose where you want to put your money. This flexibility allows you to invest based on your diversification strategy, expected returns, timeline, and risk tolerance in both conventional and alternative classes.

2.      You can invest in more asset types than just mutual funds and ETF’s, which are dependent upon the performance of the stock market.  Caleb and I invested in multifamily real estate through our self-directed IRA.

3.      Although self-directed IRA’s require direction and intentionality, they are mostly hassle free! Work with a custodian like the IRA Club; the IRA Club provides a platform for you to invest in stocks while you plan/strategize for alternate investment opportunities like multifamily real estate.  Once an investment opportunity is available for you, you can easily allocate your funds as needed.

4.      Alternative assets outside of the stock market can offer tax incentives.  Chat with us and your tax professional about how real estate depreciation can influence your tax burden.

5.      You can create a self-directed IRA via rolling over a retirement account from a previous employer (401k, 403b, or TSP), transferring from an existing IRA, or funding with cashflow.

The IRA Club has been a huge help to me in learning the ins and outs of a self-directed IRA, and they have tons of answers to frequently asked questions on their website here.

If you’re ready to get your self-directed IRA set up, here’s a link: PINIONS PRINCIPAL PARTNERS - IRA Club. Use code PINIONS for your first year free!

As always, Caleb and I are here to answer questions and brainstorm ways you can leverage your capital to best serve you and your family.

Happy Investing,

Kristin + Caleb