One of the most common goals among the American workforce is to be able to retire comfortably at a reasonable age — typically at 65. The problem is that many people are not properly preparing for their retirements, and fewer and fewer employers are offering retirement plans for their employees. Many American workers are realizing the jeopardy that their retirements are in — one in four Americans think that they will have to work until they are 80 to retire and 39% of working Americans believe that they will still have to work after they retire to be able to maintain a comfortable lifestyle. There are things you can do to start preparing for retirement while actually using your retirement to do it. Sounds weird, right? Here’s how it works:
Invest in real estate.
Plenty of people invest in real estate to create a second source of income, but you can buy it to help fund your retirement. One of the ways you can do this is to use your individual retirement account (if you already have one). The way that people do this is with self directed IRA lending, since people who own self directed IRAs are free to make whatever investments with the funds that they choose to.
I thought I couldn’t borrow from my IRA…
You can’t. Typically if you want to take funds from your IRA, there are fees and penalties associated with it, which is why you buy real estate with your IRA. Self directed IRA lending works like this: the IRA borrows an IRA non recourse loan from one of many different non recourse lenders.
What is a non recourse loan?
A non recourse loan agreement means that the borrower (that’s you) puts up some real property as collateral for the loan. The non recourse lender can only seize this property if you default on your loan and nothing else. A non recourse loan is the only way to buy real estate with your IRA.
Do you have any other questions about buying real estate with your IRA? Let us know in the comments. Helpful research also found here. Check out this website for more.
