Should I cash out small ira

[Daniel Stanziale]

Hi new here and this is my first post and hope to look back on this and see where it all started. My ? Is I have a small ira approx 7k the advisor says that I shouldn't take it out and pay penalties that could up to 40 percent including taxes claims It will earn 12% a yr but if I take and by a house that could cash flow at worst 200 a month wouldn't that earn me more. Looking for some opinions. Thank you in advance

[William W. Humphrey]

Keep in mind that there are a number of real estate investments that an IRA can make, some of which do not require a large cash amount. Some investments that I have seen:

IRA partners as tenants-in-common with other investors (which can be pretty much any person or entity) on a property.

IRA originates a bridge loan or construction loan.

IRA purchases a fractional piece of an existing note.

IRA purchases an interest in an LLC that is investing in real estate.

The point being, even a smaller amount in an IRA can begin to create earnings in the real estate asset class.