Get Like a Boy Scout: Be Prepared for Retirement with a Self-Directed IRA

Published on June 3, 2014

Boy Scouts learn at a young age to be prepared. However, Americans often don’t prepare for their retirement and fail to save adequately. In fact, according to a new study by the Employee Benefit Research Institute, more than one-third of workers (36%) have a measly $1,000 saved for their retirement years. Wow!!

With more than 6,000 Americans turning 65 each day, the retirement savings statistics are alarming. The Social Security Administration reports that 51% of the workforce has no private pension coverage; 34% of the workforce has no savings set aside specifically for retirement.

Where were these individuals when they were passing out retirement calculators? The days of looking forward to retirement are behind us and many Americans are spending their final working years wracked with worry about the future. A Towers Watson Global Benefit Attitudes Survey found that workers are especially concerned about the affordability of health care in retirement and availability of public programs.

The survey reports that only two in five employees believe they can afford any medical expenses that arise in the next 12 months. Mid-career and older employees and those in poor health were even more concerned regarding health care costs.

• More than half of all employees (53%) are concerned they will not be able to afford the health care they need in retirement.
• 83% believe Social Security will be less valuable in the future.
• 88% have comparable fears about Medicare.

These concerns and others are causing many Americans to reduce current spending and possibly consider delaying retirement, many until age 70 or later.

What can you do to be prepared?

To prepare for a happy and secure retirement, financially savvy investors should get with the program. They should use the time now to build up their nest egg by funding a retirement plan as often and as much as possible. For those who understand alternative investment options, a self-directed IRA can be a great way to build retirement wealth more aggressively. This investment vehicle allows individuals to invest in what they already know and understand … with nontraditional assets not allowed within typical retirement plans such as real estate, mortgages and other loans, private hedge funds, precious metals, limited partnerships, commercial paper and notes and more.

Self-directed IRAs can provide informed investors the ability to develop a more diversified portfolio that they control. A self-directed retirement plan allows the individual to respond to economic downturns or take advantage of opportunistic (and tax-advantaged) investments with greater flexibility. The self-directed IRA administrator like Next Generation Trust Services handles all the details of the transactions and holds the assets.

At Next Generation, our professionals are available to answer questions about self-directed retirement plans and our transaction specialists ensure you are investing within IRS guidelines. Since we do not give investment advice, we strongly recommend you consult your trusted financial advisors about your investments and any tax implications they have for your unique situation.
Have a question now? Contact Next Generation at (888) 857-8058 or Info@NextGenerationTrust.com, or read through our Starter Kits for more information.