By J.P. Dahdah, Founder & CEO of Vantage
As more people begin to use Self-Directed IRAs and alternative investment opportunities, the number of scams and people trying to swindle each other out of money continues to rise. Below are three warning signs that you need to be aware of when looking to move retirement savings into a Self-Directed IRA account.
1. Non-FDIC insured financial companies. Avoid anything or anyone who attempts to make a “guarantee,” especially if they are not FDIC insured. This means in the event of a financial disaster, you may not be able to recover any lost funds. If you have not diversified your portfolio, financial ruin is highly likely.
2. Don’t use unlicensed trustees. There are many licensed investment professionals or trustees in each state who can manage your Self-Directed IRA. Don’t work with an unlicensed trustee. You will have no recourse if they take off with your retirement funds, and you will be responsible for not performing due diligence and researching your investment institution and trustee’s information.
3. Don’t use an institution that doesn’t disclose their fees. Companies that offer Self-Directed IRAs are in business to grow and make a profit. Ensure the company you choose discloses their annual management fees and any other fees you will be charged to investing your money with them. If they are unwilling to disclose how they make their money, this could be a red flag. As a consumer, you are entitled to know and understand what portion of your investment dollars will pay for your receiving services. If you don’t feel comfortable with the answers you get, steer clear of that firm. Avoid falling into these traps by choosing an FDIC insured, a licensed trustee who has integrity and a track record to properly invest your retirement funds to grow your wealth.
For more information on how you can discover your IRA investing alternatives, contact our team at (866) 459-4590 or ClientService@VantageIRAs.com.