401(K) Rollover: To Which Form of IRA?

Colleen K. Rich
March 6, 2009 — 1,716 views  
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Although 401(K) plans are a great idea for the average lay-worker, but they still have their downsides. If a person has a choice in planning for their retirement future, then why not take a much better approach.

Another alternative is to have a self-directed 401(K) plan. With this choice investment options are more diversified than with the regular 401(K) plan but they still have their downsides. Some employer plans may impose limits as to how much of the account can go into the self-directed portion.

Remember 401(K) plans get invested in the company or what the company chooses, so they really don't want you to take control over what happens to your investments. So the employer may only allow the 401(K) owner to put ¼-1/3 of the funds into the self-directed portion of the 401(K) and the rest into the regular portion of the 401(K). This also makes things much more confusing and difficult to control for the 401(K) owner. Is that not what we all want to avoid!

You ask, is there not an easier and better way to invest for retirement and have control over my investments? And the answer is yes, of course there is. Created in 1997 by Senator William Roth and put into effect in 1998 is what we now know as the Roth IRA. But better yet is the self-directed Roth IRA. You understand the self-directed part gives you the control to decide how to investor funds, right?

This also gives you the greatest diversity portfolio available with the most control. You can also use the self-directed Roth IRA to invest in real estate which has the highest ROI, 15%-30% plus. And this form of IRA is not linked or limited to the company in any way; you are in 100% full control. The company can no longer set things up to benefit themselves. If you're going to roll your 401(K) over to something, why not do it right and make it a self-directed Roth IRA.

Does the idea of being in 100% full control sound a little scary to you? It shouldn't, because it's easier than you think. There are teams and companies out there set up just for this purpose. As all that is left for you to do, is for you to find the right one for you.

About the Author

Colleen K. Rich is an Internet Network Marketer and a Real Estate Investor. Colleen http://www.squidoo.com/ColleenKRich now networks with individuals and teams who believes in the proper techniques http://www.Income-and-Security.com used for a successful online business in today's climate no matter what a person's experience. Teach, educate and make it happen! You can contact Colleen K Rich at [email protected]esonline.net.

Colleen K. Rich