A Self-Directed IRA Investor, a Realtor, or an Investor?Posted on July 7, 2014 by
Have you ever considered which of these options will bring you more money?
- Investing in real estate as a Self-Directed IRA investor
- Using your real estate knowledge to earn your living through commissions (real estate sales as a career), or
- Simply investing in real estate
The truth is that each option has its benefits though, as with any other investment, it is always good to diversify. This means that the best option would be to do “all of the above”.
We have met so many realtors who depend upon their real estate commissions to make a living. While realtors and brokers have a wealth of experience in real estate and while they have the unique privilege of seeing the homes coming up for sale before they are advertised, many of them are not real estate investors.
In our last articles, we spoke to you about educating yourself about Self-Directed IRAs so that you can increase your customer base to include Self-Directed IRA investors. In this article, we are going to take it one step further and encourage you to put your real estate knowledge to work for you at a whole new level. Consider for a moment that you can continue to collect commissions from your real estate sales and you can also use your real estate knowledge to purchase real estate.
You have options…you can buy the real estate within a Self-Directed IRA. That will mean you can save money because the profits will be tax-deferred or tax-free depending on your IRA account type. You can also choose to buy real estate outside of your IRA. Buying real estate outside your IRA will not afford you the same tax-deferred/tax-free status; however, it will allow you to generate “current income” that you can use now. You can also choose to employ both strategies, buying some of the real estate inside your Self-Directed IRA and some of it outside your IRA thus generating both income for your retirement years and current income that you can use now.
Whichever option you select, you will be able to employ the investment strategy you prefer including buy and hold, fix and flip, and much more. We want you to enjoy the maximum success possible and diversifying so that you can draw income from both your commissions and your real estate investments will certainly help you to increase your wealth.
Of course it goes without saying, that it is important to keep it clean so that it is crystal clear that you did not unduly influence people to sell their real estate below market value so that you can benefit from it.