Best Self Directed IRA trust companies?

[Pat Bahn]

I am looking to do a self directed IRA, i was thinking of using
the "Equity trust Company" www.trustetc.com.

Their fees seem reasonable, the service seems capable, and they
are out of Ohio which is not a hotbed of fraud unlike Florida and Nevada.

Pluses: They were recommended to me. They are a family owned private business. They have been in business for a while

Negatives: They are small $64MM assets, their CPA is a one horse shop.

As I am trusting my IRA to them, I wanted opinions. My IRA was at Merrill, and they exploded, so the big guys aren't safe.
Madoff was a family enterprise also.

So what do you all think?

pat

[Tom V.]

The issue of who is the custodian of your money while it is in a Self Directed IRA is a big deal that people should think about. I use uDirectIRA and I have had mixed results with the service and the security of my personal information. My money though, when it is not invested in a note etc., sits in bank accounts of Amercan Estate and Trust, a Nevada company.

American Estate and Trust, unless you specifically tell them to keep the money in an FDIC insured institution account, has the right to invest that money in 'high quality' fixed income investments. There is no disclosure of what the 'high quality' fixed income investments are - no description is provided. IRA holders also receive a pittance of interest (they could pay me/you .5% while investing in 8% junk bonds and pocket the difference.) I transfer money out of my SDIRA when it is not locked up in a deal.

I think a lot of these outfits make a good deal of their funds by investing this 'float' - IRA money not invested by customers - in other debt or equity investments. SD IRA's are still lightly regulated cowboy town as far as I am concerned. Be careful especially that you understand (and can be shown) where your money is when it is not in one of your self-directed investments.

The risk is that your 'custodian' decides to buy a bond or make a loan or whatever in XYZ company (or uses your funds as collateral, etc.) and then it goes bad.  There is no insurance for your deposit in this case.  

Buyer beware.  Don't be afraid to ask questions aggressively.  You are your own best advocate and there are options, so if something smells bad, think carefully about it. 

Pensco is the big outfit in San Francisco that I would qualify as blue chip and most reliable, but they also charge % of asset fees.

Good Luck to All!