Newman Asset Management Blog

More Ways to Make Money With a Self Directed Roth IRA (individual Retirement Account).

A nice short article to think about for the coming year…As we all look for new ways to make money, and to make money with our self-directed retirement funds, it is often a good idea to look at some old ways of using your money to make money.Buying real estate with a self-directed account, be it a traditional IRA or Roth IRA, is nothing new. Yes, here are rules to follow…that is why Newman Asset Management is in business, to help you with these…but overall it is not that difficult for someone willing to be coached and guided. I will not go into detail here as this point in the article is well known and we work with many already doing this type of investing.

The point I want to bring up is the tax lien investment mentioned. This area of investing is like Texas weather – it blows in favorably for a while and then back out again. The reason for investors to look at this area again now is due to the current state of the economy and the still rising foreclosure rate. You may ask, “What do foreclosures have to do with tax liens?” The answer is …maybe a great deal in some cases. What those who research will find is that properties that are going into foreclosure often have outstanding tax positions as well. These outstanding obligations have to be taken care of before the property is sold. In many cases, a savvy investor can pick up a tax lien on a very good property and get very good returns for their money…in many states from 15-26%.

Are there any risks? Of course, this is investing not get rich quick. Those interested in this area will need to do the following:

• Work with professionals who have handled tax liens or worked with tax lien investments.
• Research, or pay to have it done, the rules for your state and area…these will tell you what the process is and how you can make money.
• Begin doing your own research on areas with foreclosures that are likely to move…builder foreclosures, newer neighborhoods, good rental neighborhoods, etc.
• Have your funds available. If you are wanting to use retirement funds, makes sure your self-directed account is setup properly and ready to go (…again, Newman Asset Management can help you with this).

Like most investments, this is not a one shoe fits all scenario, but as you look across the investment landscape it is an area that will remain a good opportunity for those who do their homework. For those interested, give us a call and we will help you get going.

Until next time…

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Tags: IRA, Real Estate, tax liens

This entry was posted on Wednesday, December 2nd, 2009 at 10:22 am and is filed under Real Estate, Retirement. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.