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4 Reasons to Dump Stocks and Buy Real Estate to Diversify Your IRA

01 September, 2018

4 Reasons to Dump Stocks and Buy Real Estate to Diversify Your IRA

There has never been a better time to diversify your financial portfolio with investment properties, and buying real estate with IRA accounts is a smart alternative investment option that can dramatically increase your ROI and provide ongoing retirement income for many years to come. Read on to see our top four reasons to diversify your stock market investments and unlock the benefits of buying real estate in a Self-Directed IRA account.

1. Stock Market Volatility 

First and foremost, ongoing stock market volatility should be enough to convince investors to diversify, but if not perhaps the chorus of longtime investment analysts who have issued warnings will do the trick. The bottom line is, don’t put all of your eggs in one basket! Instead, include alternative investments like real estate in your Self-Directed IRA retirement account, to create a buffer to stock market uncertainty, and provide steady income plus proven capital appreciation.

2. Tax-Deferred Growth

When you buy real estate with IRA account money, all of the gains will be tax deferred for that investment. Reducing the taxes you have to pay now greatly increases financial security, because the higher your income and tax bracket, the more money you can save by contributing to your retirement accounts. So, if you use funds in your IRA account to buy an income producing investment property, such as a turnkey vacation home rental or apartment building, all rental income (and property appreciation if and when it is sold) will be tax deferred until IRA distributions are taken.

Tax-Deferred Growth

Also Read:

7 Reasons Real Estate Investing is Better Than the Stock Market

How to Boost Retirement Income with Real Estate Investing

Self-Directed IRA Rules for Buying Real Estate

3. Protection from Inflation

Real estate also provides protection from inflation, because brick-and-mortar investment property values (and rents) tend to rise along with inflation, while other investments often remain fixed, or even fall in value. Buying real estate in your IRA account helps to provide protection against the decreased purchasing power of a currency that results from the loss of its value due to rising prices associated with inflation.

Steady Retirement Income

4. Steady Retirement Income

Income producing investment properties are also a great way to secure ongoing, proven retirement income through turnkey vacation homes or other rentals. In fact, real estate remains one of the few investments available today that can provide consistent return on investment of 8-14 percent, which is what many investors will need to earn in order to fully enjoy retirement. To succeed, look for professionally managed, modern, attractive properties in high-demand locations, where you’ll never have to worry about property depreciation.

Do you have questions about buying real estate with your IRA account? Post them in the comments!

Want to Know How to Invest in Real Estate with your Self-Directed IRA?

Topics: Real Estate IRA Alternative Investments