What exactly is a Self Directed IRA?
Since the passage of the Employee Retirement Income Security Act (ERISA) in 1974 you have been allowed to invest in almost any type of asset through your IRA. Yet still today most IRA custodians (such as brokerage firms and mutual fund companies) limit your investment choices to publicly traded stocks, bonds and mutual funds. A truly Self Directed IRA (or “SDIRA”) allows you to direct your capital toward any IRS permitted investment you choose, including real estate, mortgages and trust deeds, pre-developed land, private placements, tax liens, franchises, and the list goes on. The IRA account itself must be held by a custodian or trustee on the IRA owner’s behalf, but the investment options extend well beyond the highly volatile stock and bond markets.
