Despite their popularity, some investors still don’t even the basics about IRAs. In this episode, David answers the most obvious question: “What is an IRA?”
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Patrick: Today we’re talking with David Moore, co-founder of IRA Advantage, a firm that specializes in truly self-directed retirement accounts. David, the question on everybody’s mind is the basic one.
What is an IRA?
David Moore: An IRA is an individual retirement account. They were first established in 1974. The first type of IRA was a traditional IRA. In 1978, we received the simplified employee pension plan, which is a SEP. We also got the 401k at that time. Finally, in 1987 we got Roth IRAs, which are different than traditional in that traditional IRAs grow with pre-tax money and everything is tax deferred. A Roth is taxed money that grows tax free.
David, you mentioned that often clients who already have IRAs come to you. Why is that?
David Moore: They want something else. They forever have been investing in Wall Street and they’ve been told that’s all they could do. The reality of it is that since the IRA inception in 1974, IRAs have been able to acquire anything other than stock in a subchapter S company, life insurance contracts, or collectibles. Nothing’s ever changed, it’s just becoming more widely accepted.
Patrick: Thank you David. Listeners may call 503-619-0223 or can visit iraadvantage.net for more information.
IRAs are a very popular retirement investment strategy, it’s important to know what they are and what options you have before moving forward.