Where Will Your Retirement Dreams Take You? A Self-Directed IRA Can Help Get You There

Published on October 20, 2022

If an affordable retirement lifestyle is at the top of your wish list, best to put Hawaii at the bottom, as a recent Bankrate report revealed it to be the most expensive state for retirement this year.

The top ten list of least affordable states are Hawaii followed by: California, Connecticut, Massachusetts, New Jersey, Vermont, Rhode Island, Maryland, New York, and Maine.

Bankrate evaluated two data reports to derive its affordability list for each state. They were the Community and Economic Research’s cost of living index (July 2022) and the Tax Foundation’s 2022 rankings for property and sales tax rates. See how your state ranks for retirement affordability here.

It is estimated that retirees will need about $2 million saved for that retirement in Hawaiian paradise, due to that state’s cost of living. However, many Americans have not saved nearly that millionaire amount. CNBC reported that on average, Americans have saved up approximately $141,542 for retirement, based on Vanguard’s 2022 “How America Saves” report.

Of course, what one person deems “affordable” may be another person’s “out of reach” based on retirement savings and sources of income. The definition of “comfortable retirement” also varies. Is it downsizing to a modest home, living on a small monthly budget, and taking one big travel splurge a year? Is it a luxury beach house and a busy social life or a quiet retreat? A NYC condo, weekly theatre outings, and dining out several times a week?

When you factor in the inflation and extreme stock market volatility of 2022, many near-retirees may be reconsidering their retirement timelines, with plans to work a bit longer to cover living expenses and have more time to shore up their retirement accounts.

Planning early and often for retirement will help guide savings goals and determine how to invest your retirement savings. And saving for retirement with a self-directed IRA could help you reach those retirement goals (and that dream lifestyle) by investing in alternative assets.

Self-directed IRAs forge a potential path to that dream retirement

Taxpayers can’t do much about inflation other than weather that financial storm. But when it comes to building a more diverse retirement portfolio—and a hedge against stock market volatility—self-direction can be a powerful retirement strategy.

Imagine building retirement savings with investments whose performance may not correlate with the stock market—investments in which you may already be investing outside of your existing retirement account.

Self-directed IRAs can include a broad array of nontraditional investments. This enables account owners to think big about their retirement dreams and use real estate, private stock, precious metals, cryptocurrency, tax liens, secured and unsecured loans and many more alternative assets to build retirement wealth. Plus, self-directed IRAs offer all the same tax advantages of their regular IRA counterparts. You can open and self-direct a Traditional or Roth IRA, a SIMPLE IRA, Solo (k) or SEP plan, as well as a health savings account or education savings account.

If you are comfortable doing your own research into alternative assets, conducting your due diligence on those investments, and making your own investment decisions, you can design a retirement portfolio with the potential to support a comfortable retirement anywhere your dreams take you.

Get started on your dream retirement at Next Generation

At Next Generation, our team of IRA specialists can walk you through the steps to open and fund your self-directed retirement account, as well as discuss your investment ideas. In addition, the webinars offered on our website provide expert insight on making a variety of nontraditional investments through self-direction. Feel free to book a complimentary educational session with a Next Generation team member who can answer your questions and provide further insights. Alternatively, you may contact us directly by email at NewAccounts@NextGenerationTrust.com, via phone at 888.857.8058, or text our team at 848.233.4076. We can’t wait to hear about your retirement dreams!