Over the course of these last few years portfolio manager have nearly grown sea sick from the rollercoaster drops in the market. During this wild ride many investors and individuals preparing for retirement have been required to sit back and watch the market, all without a say in the fiscal and monetary policies the government has made that influences their retirement so heavily. Now, as the government continues to inject money into the market to stimulate growth, many fear hyperinflation will hit the economy causing the value of their portfolio, especially those invested in bonds, to decrease to the point that may completely crush their dreams of early retirement.
How can you take control of your retirement?
Taking control over your retirement plans is not an easy task; however, it can and should be done. Professionals at SilverStone believe one of the most effective methods taking control over your retirement is by rolling over your funds from a 401(k) into a self directed IRA and then purchasing income generating property and real estate. There are a number of benefits to taking this approach including the following for key points:
1. 1) Investing in real estate is taking your cash and putting it into a hard asset that will typically always hold some sort of value. As inflation hits an economy the value of the assets will increase as the value of the dollar decreases. This is much better than a bond because during periods of high inflation those who own another entity’s debt lose while those in debt win.
2. 2) Rents will increase as the cost of living increases. If you own part or all an apartment complex that pays out $50,000 a month in profit and the cost of living increase by 25% or by 500% you can guaranty that the your rents will gradually increase by that number as well ensuring your retirement needs are always met.
3. 3) Many believe that the housing market is in a trough that may pick back up in the near future while others believe is will dive into a double dip before it comes back up. Either way, if you are purchasing the property as a long-term investment that you will hold for years on end then most agree that the market will pick up far above its current level. This alone will make the investment property produce a healthy IRR during the holding period.
4. 4) The forth and final point is that unlike investing in the bond market, you are not required to forfeit the asset at some specified time of maturity. If you want to hold the asset for 5 year, 20 years, 30 years, 50 years or just pass it down to your posterity after you have deceased then nothing is stopping you from doing so. Your holding period is what you would like it to be.
These four points are the logical reasons that many have been turning to self directed IRAs to invest in their own private deals so they can take more control of their retirement plans. Now is the time to jump into such investments as the housing market is as low now as it may ever be in the next 100 years.
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