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Equity Trust's John Bowens talks about what is a selfdirected IRA, in general. Most people are familiar with IRAs and retirement accounts with other financial institutions that limit them to only investing in stocks, bonds, mutual funds.

But we're going to talk about a truly selfdirected IRA that can enable you to invest in much, much more.

1. What is a selfdirected IRA?
A selfdirected IRA is really just like any other retirement account. Selfdirected is just an industry term. What we really need to talk about is what investors are putting inside of that selfdirected IRA, or what they're using that money in that selfdirected IRA to invest in.

Let me contrast this for you. If you set up an IRA or a retirement plan with most other financial institutions, they're going to limit you to what you're allowed to invest in with your IRA funds.

Now, many financial institutions offer a selfdirected IRA, but many of them limit you to only investing in traditional securities or traditional investments. Things like stocks, mutual funds, ETFs, bonds. So traditional investments.

2. We then have a true selfdirected IRA, which can allow you to invest in a wide array of alternative investments.

You're not limited to just stocks, bonds, and mutual funds. So ultimately what it comes down to is what custodian, or what financial institution, is holding your IRA, and then allowing you the freedom to selfdirect into the assets that you see as a best fit for your own particular portfolio, most suitable for your particular portfolio.

3. Think of an alternative asset custodian, such as Equity Trust Company, as a custodian that allows you to move your IRAs, or 401k rollovers, into an environment that allows you to invest in real estate.

You can invest in notes, you can invest in small businesses. So if you have an opportunity to invest in a hedge fund or a private equity fund, you can invest in these various other alternative investments in addition to mutual funds, stocks. You can essentially do everything all under one roof.

4. The key distinction between these two financial types of institutions is one type of financial institution is going to limit you, and many of these institutions also offer some sort of advisory services.

They're advising you on investing in stocks and mutual funds and other traditional investments. Equity Trust Company is a passive nondiscretionary custodian, so we're not giving you advice on where to invest or how to invest. You ultimately have complete control and freedom over what you want to invest in.

A lot of customers come to Equity Trust Company to invest in real estate, to buy, fix, and sell, to buy and hold, to buy land, to invest in tax liens, to invest in precious metals, cryptocurrencies, and a wide array of alternative investments.

5. How do you get started with opening and funding a selfdirected IRA to invest in real estate in these various other alternative assets that I talked about?

Step one will be do your own due diligence and identify a custodian that's right for you. Equity Trust Company is a custodian, as mentioned, that allows you to invest in all of these various alternative investments with very few limitations.

You'll want to open and fund your account, and you'll want to make sure that you do that well before you begin identifying and directing your investments. Keep in mind that when opening and funding a selfdirected IRA, it can take time to get money moved from your other financial institution.

We're at the mercy of that other company to transfer the funds to Equity Trust as your new custodian, to then facilitate the deployment of that capital for your real estate or other alternative investments.

When you call us directly, we'll have one of our associates walk you through the paperwork over the phone, walk you through the online process over the phone to make it seamless and easy to open and fund your selfdirected IRA.

Equity Trust Company is a directed custodian and does not provide tax, legal or investment advice. Any information communicated by Equity Trust is for educational purposes only, and should not be construed as tax, legal or investment advice. Whenever making an investment decision, please consult with your tax attorney or financial professional to determine whether an investment product, plan or strategy is right for you. Investing involves risk, including possible loss of principal.