Converting retirement accounts (401k/IRA) into real estate assets

[Geoff Stuhr]

I posted this on LinkedIn and also felt like it could be helpful on BiggerPockets - I get asked from time to time about converting retirement accounts such as 401k/IRA into real estate assets... Wall Street often doesn't highlight these options because they make money from the fees on traditional investments, but with a Self-Directed IRA or Self-Directed 401(k), people can take control of your retirement savings and invest directly into real assets if they wish.

Here’s how it works:

1. Set Up a Self-Directed Account: Find a custodian or administrator who specializes in these types of accounts

2. Transfer or Rollover Funds: Move your funds from your existing retirement account into your new self-directed account

3. Invest in Real Assets: Use the money in your self-directed account to invest into real estate or other tangible assets such as gold and silver

There are some rules to follow, like avoiding prohibited transactions and ensuring that your assets are held by the custodian. It’s a bit of a learning curve, but can be worth it for the potential benefits.

As always, chat with a tax professional to make sure you’re on the right track and taking full advantage of the benefits.