Know More About Self Directed 401k

Sep 26 06:17 2012 Rick Pendykoski Print This Article

A self directed 401(k) is a type of retirement plan. This plan does not differ from any other 401(k) or IRA plan. The most prominent feature of this plan is that it gives you power over your investment decisions.

Retirement investment custodians often offer limited ability to invest in various types of assets. With self directed 401(k),Guest Posting you get more power and you can choose your investment routes yourself. 

There are many benefits of investing in a self directed 401(k) plan. The number one benefit is the ability to take part in the decision making process. You can expand your investment and increase your retirement assets.
You should be aware that the IRS permits self directed 401(k)s under specified rules and regulations. You can get details of the rules in the IRS publications. You should go through publications number 560 and 590 to know more about self directed 401(k) plans. You will also find some other rules and regulations pertaining to self directed 401(k) plans.

IRS also ensures that all types of self directed 401(k)s comply with the rules stated by them. So, you should be familiar with all these rules to avoid any confusions. Another important thing to know about self directed 401(k)s is that there are a few transactions that are strictly prohibited when you invest in self directed 401(k)s. You should pay special attention to such transactions to ensure that you reap maximum benefits from this type of a plan.

Another important thing that you must fully understand is that your investment is not guaranteed under self directed 401(k) plan. Only FDIC-insured deposits have guarantees. This makes it more risky to invest in various assets. However, high risks implies higher returns in most cases.

The above points will tell you that the self directed 401(k) plans are only suitable for those who would like to amass wealth using their understanding on investing in assets rather than bonds, stocks and CDs. In fact, people who have good knowledge of financial industry can make the most of such schemes. However, a person with limited knowledge may not be able to make the most of such an avenue.
Self directed 401(k) plans are a good choice for people with better knowledge of stocks, bonds and other investment options Self Directed 401(k) can help you a long way in making the most out of your retirement investment.

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About Article Author

Rick Pendykoski
Rick Pendykoski

Rick takes great pride that Self Directed Retirement Plans LLC continues to give honest and very experienced advice, many times with investments most CPA’s or other advisors can’t or won’t.  Rick can readily converse with business owners and people looking to take control of their retirement accounts.  

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