In today’s episode of Adam Talks, Adam Bergman, Esq. discusses some investments for your Self-Directed IRA in light of a high interest rate environment.
Best Self-Directed IRA Investments for High Interest Rates
Adam Bergman, tax attorney and founder of IRA Financial, discusses the best Self-Directed IRA investments in a high-interest rate environment. He mentions that alternative assets are still popular among investors who want to diversify their portfolios and hedge against inflation. Bergman lists gold and precious metals as the top pick for 2023, as they have seen a resurgence in demand; they are making a comeback as a hot investment due to their historical role as a hedge against inflation.
Promissory notes, particularly hard money loans for real estate investors, are the second pick due to the potential for strong returns and tax advantages when using an IRA. Banks have pulled back lending, creating opportunities for private lenders. Real estate, especially residential and commercial properties, is the third pick, with opportunities arising as prices drop in certain markets and mortgages need to be recalibrated to current interest rates. Bergman also mentions cryptocurrencies as the fourth pick, acknowledging concerns about the safety and accountability of exchanges. Lastly, crowdfunding, specifically Reg CF, is mentioned as a fifth pick for small businesses looking to raise capital.
In summary, Bergman recommends gold and precious metals, promissory notes (especially for real estate), and real estate itself as the top three Self-Directed IRA investments in 2023. He highlights the advantages of using retirement accounts for hard money loans, as the interest received is not subject to ordinary income tax rates and notes the changing investment landscape, with gold making a strong comeback and the potential for real estate prices to drop and create more opportunities. However, he does express concern about the lack of accountability on cryptocurrency exchanges. Overall, he emphasizes the continued interest in alternative assets and the need for diversification in IRA investments.
Overall, Bergman highlights the changing order of alternative asset investments in 2023 compared to the previous year. For more information, be sure to listen to the entire podcast.