If you are looking for broader investment options, then consider a Self-Directed Individual Retirement Account (SDIRA).
What is an SDIRA?
An SDIRA is also an IRA, but the difference arises from two aspects. One, you can diversify your investments in a broader range of assets. Two, you can take all the investment decisions by yourself. Meaning, you can decide what and how to invest or what things made self-directed investments so popular.
The Initial Step
Once you decide to open an SDIRA, the first step is to choose and avail of the services of an IRA custodian. Make sure that you select a reputed custodian that is well-versed in the maintenance of such accounts. Also, do not forget to shortlist a few of the custodians and compare their fees.
Once you have selected a custodian, you can now open your SDIRA. After setting up the account, you will be able to contribute funds to the SDIRA.
After you create your account, you are free to choose your investments and instruct your custodian to invest the funds on the assets you choose. However, there is also a more convenient way to invest through an SDIRA–the creation of an SDIRA LLC.
You need to hire an experienced legal professional to manage the affairs of the creation of the LLC, as that is a complicated process. Subsequently, you can track the investments made through the LLC.
Avoid Prohibited Transactions
You should make sure that you avoid prohibited transactions. So, brush up your knowledge with the existing prohibited transactions. Bear in mind that despite an SDIRA gives you more freedom to invest compared to a traditional IRA, yet there is a limit that you cannot breach.
As already mentioned, you can invest in alternative assets if you have an SDIRA. When it comes to investing in alternative assets, startups can be a good option. Read the infographic in this post to know all about investing in startups.