Investing in an Individual Retirement Account (IRA) may sound simple and easy, but there are plenty of considerations that we have to understand, and there are choices that we need to make. First of all, we have to find the best IRA companies that are offering the best IRA rates — it is obvious that getting the best is what we all want and need. Opening a type of IRA which is flexible enough to give us freedom with our investments, and better opportunities for growth, is advised.
However, finding an investment structure which will let us do several things and enjoy plenty of great opportunities for our investments is a good way to gain better profitability. Such investment freedom may be achieved with an Open Opportunity IRA, which provides maximum flexibility with your retirement investments.
What is Open Opportunity IRA?
Open Opportunity IRA is an IRA structure which lets the account holder hold real estate and rental properties, stock in private companies, own American Eagle gold coins (which may be stored anywhere according to the preference of the account holder), and withdraw all the gains at the right time without having to pay taxes and fees.
Basically, you can invest your IRA into an LLC which is owned by you, meaning you can choose different and unique investments, which can help lead to higher returns per year.
This is truly an “open door opportunity” for all IRA owners.
Converting to a Roth or Open Opportunity IRA
Account holders are eligible to convert their Traditional IRA to a Roth IRA any time they want. If one finally decides to convert his Traditional IRA to a Roth IRA, then he is making the right decision. Since the distributions from Roth IRA are tax-free, this is advantageous for those people who are expecting to belong to a higher income tax bracket in the future, which is more likely to happen to most of us. Paying tax now — at today’s tax rates which are obviously much lower than the rates in the future — on the fair market value of the investments that one transfers from a traditional IRA to a Roth will give better net gains.
However, using Open Opportunity IRA structure is another better way to take away more of the tax cost of a Roth conversion. This will also open up better investment opportunities that promise better returns later on.
Achieving Investment Freedom
It is said that using an Open Opportunity IRA structure gives more investment freedom and flexibility. Using this structure, the IRA will be allowed to hold one asset that the account holder will personally manage. This type of Self-Directed IRA is not totally tied-up by a bank, brokerage firm, or mutual fund family that manages the IRA. The IRA holder himself personally manages his own IRA LLC, thus the account holder is always free to do what he thinks is best to do whenever he encounters better and richer opportunities.
The bigger chance of getting a higher tax rates later on truly makes a Roth conversion a wise move to take. Nonetheless, the tax savings available with the Open Opportunity structure is the right and better move to consider.