Solo 401k or self directed Roth for real estate investing!

[Michael Blackwood]

I'm kicking around the idea of moving 401k funds out of the stock market and into real estate investments. I started researching self directed IRA because a lot of people seem to use that on here but I stumbled across a Solo 401k vs self directed IRA comparison and there were some compelling differences in favor of Solo 401k. Does anyone have any opinion on which one is better and why?

Thanks in advance.

[Brian Eastman]

@Michael Blackwood

If one qualifies by being self-employed with no full time employees, then the Solo 401(k) is likely going to provide some advantages over an IRA as a 401k is simply a more robust retirement plan with features such as higher contributions, a personal loan provision, ability to hold both tax-deferred and Roth funds, and an exemption from a small tax on leveraged income in real estate.

Whether you A) qualify and B) will benefit from those differences is a matter that hinges on the details of your situation and investment goals.  A conversation with a professional or two in the field will be the best way to get to the heart of that question.

Either way, both plans are great vehicles for taking control of your tax-sheltered retirement savings and investing in real estate and other secure assets.