IRA's, 401k's, & Other Forms Of Retirement Planning

There has been a change or revolution, if you dare call it, taking place in the United States. What is it you ask? The use of IRA's for real estate investing. That's right, many people, especially baby-boomers, are no longer depending on traditional methods for investing their IRA's. The unpredictable and volatile stock market along with low paying mutual funds and CD's are no longer the main stream for retirement planning. IRA investing in real estate has quickly become the way to secure those future years of bliss! And for those individuals that have already lost so much, it may very well be the only way to stay afloat and pull their heads out of the sinking sand.

IRA real estate investing makes up for approximately 50% of the U.S.'s net worth per capita, and almost twice that much of wealth is acquired through real estate. But sadly enough, only a few percent of that is acquired from IRA investing in real estate. So why is it that so many people are still not using their IRA accounts for real estate investing? The raw simple fact is 'ignorance' (lack of knowledge) or self education. People are just not educated on the facts of IRA's and real estate investing. You would be amazed at how many CPA's still have no clue to the fact that their clients could be using IRA's for real estate investing and that it is actually 'legal'. Yes, that is right an individual can put their IRA into a 'self-directed' IRA and actually make the decisions themselves as to what happens to their retirement nest-egg. Of course you have to keep in mind that it takes a good CPA to help you keep those large profits. To do this many individuals use some form of business/company such as a corporation or LLC, but I can not, nor would I, attempt to advise anyone in this matter. You should consult your real estate attorney or CPA for further information and advice on this matter.

The catch to using an individuals IRA for real estate investing is that it is restricted for the sole purpose of investment only, but investments can be made in the U.S. as well as internationally. Did you know that IRA's used in real estate investing can get up to 70% bank non-recourse financing to purchase income-producing investment properties. Results have shown triple to quadruple return on investment on all-cash IRA investments in real estate.

For example let's imagine that you had a property on 'Land Contract' and put a future owner in it that will purchase the property from you in 12 months. Obviously dollar amounts, all time periods, and interest rate vary, but I'll use this for the sake of an example. The future owner gives you a non-refundable deposit of ($3,000) and make monthly interest rent payments of ($600). The new owner is responsible for all taxes and repairs. At the end of 12 months the future owner purchases the home for a profit of ($30,000). Now if you add that up for a 12 month period it was a ($3,000) deposit, ($7,200) total monthly payments, and ($30,000) cash-out for a total of ($40,200) interest profit in 12 months! Try to acquire that in one year using traditional methods. I have four words for you. NOT GOING TO HAPPEN!!!

It is easy to see why there is this revolutionary new way of investing taking place in the U.S., of using IRA's for real estate investing verses traditional methods. As an investor myself I have seen first hand the changes taking place and the opportunity at hand. The wealth to be made is amazing and retirements will be secured once again. And so I guess the question is; Are you one of those people? Are you financially prepared for your retirement future? Or are you one of those people who just want more and will not settle for less than the best? Which is great, don't get me wrong. The point is, why settle for less if you can have your dream and security all by using your IRA and investing in real estate. Or maybe your at that point and have little to no retirement. The new laws can help you as well. I have seen the changes the laws have made first hand in this business and there is hope.

Colleen K Rich is a real estate investor that partners with both private individuals and lending corporations to finance investment properties. Colleen also works with investment groups/teams http://www.IRA-and-Investing.com that offer services for IRA's, 401(K)'s, cash & other forms of investing, as to ensure that all may be educated and helped along in the process of retirement planning. The web site has valuable information and an E-book/special report, which can be sent to you upon request. Colleen K Rich can be reached at Investing4Retirement@gmail.com for further questions on retirement or cash/private money investing. You can find more articles related to this topic and author online. To find out more on how the power of leverage can work for you visit: http://www.Retirement-and-Planning.com or call 1-248-891-8339.

IRA's: The Differences You Should Know

Investing In Foreclosures With IRA's

401(K) Rollover: To Which Form of IRA

IRA's and Estate Planning: Are You Prepared

The 403 (b) Plan Explained

Why Use A Self-Directed Roth IRA For Real Estate Investing

If you are self-employed (S.E.) or a business owner you may have heard of a Solo IRA or Solo 401(K). But do you know the differences? Solo 401(K)'s are sometimes referred to as a Solo K or S.E. 401(K). When you get your federal income tax return, Solo IRAs are listed as SEP-IRA (simplified employee pension) or a broker may call it a SEP. I will explain the differences between the two, along with the pros and cons of each.

Only people who are self-employed and/or business owners and their spouses, are allowed to open a Solo IRA, whether they have employees or not. You and your spouses can also open a Solo 401(K), but only if you have no employees who get a W-2. So for example, if you own a restaurant and have employees, you would not be eligible to open a Solo 401(K). Although you can hire out (outsource) help as contractors, etc., because these people are in business for themselves and do not get a W-2 from you along with their pay. Solo IRA's & Solo 401(K)'s can also be 'self-directed' as well.

As with any form of investing for retirement, there are rules or guidelines governing Solo IRAs and Solo 401(K)'s. For instance, Solo IRAs can only be a Traditional account (Traditional Solo IRA), and not a Roth. Anyone can have a Roth IRA, whether they are self-employed and/or business owners or not. Many self-employed people and business owners have both, a Roth IRA, and either a Solo IRA or Solo 401(K).

Solo IRA and Solo 401(K) contributions are tax-deductible, which means taxes on contributions are not paid until funds are withdrawn at retirement. But there are differences between the two. Solo 401(K)'s have a higher yearly limit on contributions and they require much more paperwork involvement. So it may be difficult to find a company or broker that offers this service. The yearly allotted contributions for both a Solo IRA and Solo 401(K) changes yearly. So Do Your Homework! With Solo IRAs and Solo 401(K)'s, the maximum allotted yearly annual contribution per couple in 2008 was over $100,000. Solo IRAs and Solo 401(K)'s carried the highest maximum contribution dollar amount of any contribution investments, but it is based on a percentage of income or company profits.

For example, a Roth IRA only allows for a maximum annual yearly contribution of $10,000 per couple, or $5,000 per individual and will continue to increase $500 a year starting in 2009 due to inflation. You can read up more on Roth IRAs, self-directed IRA's, and self-directed 401(K)'s at ezine articles online under author Colleen K. Rich starting with 'IRAs: The Differences You Should Know' and 'Different IRAs and Their Investment Options'. Now if you have both, a Roth IRA, and either a Solo IRA or Solo 401(K), there is also a combined maximum allotted yearly contribution dollar amount. You can consult your accountant or broker for more information.

So as you can see, if you are a self-employed and/or a business owner and your yearly income is higher, you benefit by having a higher annual yearly contribution dollar amount. The downside to Solo IRAs and Solo 401(K)'s, is that they are not tax-deferred, and therefore you pay taxes on distributions at retirement (higher dollar amount), versus paying taxes on contributions now (lower dollar amount), and do not benefit from having contributions at retirement distributed tax-free.

I know that sometimes retirement planning can seem confusing or complicated. But keep in mind that there are groups/teams out there available to help you, when you decide to go forward with your retirement planning, whether self-employed or a business owner.

Colleen K Rich is a real estate investor that partners with both private individuals and lending corporations to finance investment properties. Colleen also works with investment groups/teams http://www.Retirement-and-Planning.com that offer services for IRA's, 401(K)'s, cash & other forms of investing, as to ensure that all may be educated and helped along in the process of retirement planning. The web site has valuable information and an E-book/special report, which can be sent to you upon request. Colleen K Rich can be reached at Investing4Retirement@gmail.com for further questions on retirement or cash/private money investing. You can find more articles related to this topic and author online. To find out more on how the power of leverage can work for you visit: http://www.IRA-and-Investing.com or call 1-248-891-8339.