Watch this video to learn about Self-Directed IRAs vs. Standard IRAs.

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Most investors and financial advisors can agree on the importance of diversifying your retirement portfolio to reduce overall investment risk.
But you still may be wondering, which IRA account is best for me? In this video, we dive into the key differences between a Standard IRA and a Self-Directed IRA. Let’s get started!

#1 Asset Choice
In a Standard IRA, you’re limited to Wall Street investments like stocks, bonds, and mutual funds.
However, with a Self-Directed IRA, you have the power to invest in alternative investments like real estate, precious metals, private business, and more!

#2 Asset Security
When investing in general, it’s important to note that no asset security is ever guaranteed. In a Standard IRA, your asset’s value will generally follow the trends of the stock market.
Some alternative assets held in a Self-Directed IRA like real estate tend to retain value, while others can be more volatile. It all depends on your specific investment.

#3 Fees
Standard fee schedules are generally asset-based, which means that you’ll be charged an annual fee based on the amount in your account. The larger the account (and the more it grows), the higher the fee charged.
Different Self-Directed IRA companies may have different fee schedules. A Madison Self Directed IRA allows you to invest with a flat fee schedule. You will never be charged more for being successful.

#4 IRS Rules
Every retirement account is subject to the same IRS Rules, including Self Directed IRAs!
Due to the more hands-on nature of a Self-Directed account, accountholders are encouraged to do their own due diligence when it comes to their investments and understand rules like Prohibited Transactions.
For example, you can’t transact with certain family members that are considered lineal descendants to you, including:
– Your parents
– Your children
– Your grandchildren
– Your son or daughter-in-law
These family members are also known as “disqualified persons.” Investing with any of these family members will result in a prohibited transaction.
People that aren’t considered lineal descendants that you can invest with include:
– Siblings
– Neighbors or friends
– Cousins, Aunts, and Uncles
#5 Role of the Custodian
All IRAs, standard and Self-Directed, are held by a regulated custodian. Most banks, brokerages, and online trading platforms offer IRA accounts.
On the other hand, Self-Directed IRAs are offered exclusively by regulated custodians who specialize in Self Directed IRAs, like Madison Trust.

Are you ready to begin your alternative investing journey? We’re here for you!
Our dedicated Self-Directed IRA Specialists will provide step-by-step guidance from account setup all the way to placing your investment.
Madison is ready to provide exceptional services for your exciting opportunities!

(800) 323-9203
questions@madisontrust.com
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Self-Directed IRA vs Standard IRA: Which is the Right Choice for You?

When it comes to planning for retirement, individuals have several options to choose from, and one of the most popular choices is an Individual retirement account or IRA. Developing a comprehensive retirement strategy involves careful consideration of the various types of IRAs available. Two common types are Self-Directed IRA and Standard IRA. This article will compare the two and help you understand which option might be the best fit for your financial goals and investment preferences.

A Standard IRA is perhaps the most well-known type of IRA. It allows individuals to contribute pre-tax income, which means that contributions are made before taxes are deducted. This provides a tax advantage, as the amount contributed is not taxed until the funds are withdrawn during retirement. This may be beneficial for individuals who expect to be in a lower tax bracket during retirement as it can potentially reduce their overall tax liability.

On the other hand, a Self-Directed IRA offers more flexibility in terms of investing. With a Self-Directed IRA, the account holder can invest in a wide range of assets, including but not limited to stocks, bonds, mutual funds, real estate, precious metals, and even private equity and cryptocurrency. This allows individuals to diversify their investment portfolio and potentially achieve higher returns.

Madison Trust Company is a leading provider of Self-Directed IRA services. With a Self-Directed IRA from Madison Trust, you have the freedom to choose from a broader array of investment opportunities compared to a Standard IRA. This flexibility empowers you to explore different asset classes and investment strategies that align with your financial goals and risk tolerance.

Furthermore, a Self-Directed IRA with Madison Trust Company provides access to alternative investments, which are typically unavailable in traditional investment accounts. For instance, you can invest in real estate properties, whether residential or commercial, and benefit from potential rental income and property appreciation. You can also invest in precious metals like gold and silver, which have historically been considered a safe haven during economic uncertainty. Additionally, Madison Trust offers the option to invest in private equity, giving you the chance to participate in the growth of private companies.

When considering a Self-Directed IRA, it is important to keep in mind that it requires active involvement and diligent research from the account holder. Unlike a Standard IRA, the responsibility of finding and managing investments falls on the account holder’s shoulders. Therefore, it is paramount to have a solid understanding of the chosen investment and conduct thorough due diligence before committing funds.

In summary, both Standard IRA and Self-Directed IRA have their advantages and disadvantages. A Standard IRA offers the tax advantage of contributing pre-tax income, while a Self-Directed IRA from Madison Trust allows for more investment options and potential higher returns. It ultimately depends on your financial goals, risk tolerance, and interest in actively managing investments. Speaking with a financial advisor and considering your individual circumstances will help you determine which IRA option is the best fit for you. Regardless of the choice, it is never too early or too late to start planning for retirement and securing your financial future.