Buy A Business With Your Retirement Account

                                                                                         

urchasing a business is not as easy as buying a piece of property. Sure, a real estate deal is complex but there are fewer unknowns and potential pitfalls. A business's success is tied to the market for its goods and/or services, its ability to beat the competition, its access to resources, and the capabilities of its management team and its employees. A strong business plan is only part of the story.Some of the risks involved with starting a business can be mitigated by buying a franchise or by buying an existing business. In both cases, much of the initial groundwork has been laid and many of the initial hurdles have been conquered. Of course you have to usually pay a little extra for this head-start on success but that is the cost of avoiding some of the risks.Because of the unpredictability of starting a business, many traditional IRA custodians will not allow IRAs in their care to participate in such investments. They are fine with you buying stock in a company but less inclined to let you get in on the ground floor. This is well within their rights and is usually made plain in their plan documents from the start. However, such risk aversion rarely produces extraordinary returns.Investing Wisely and FreelyIt is sage advice that you should not invest with money you cannot afford to lose. No one can predict the future with absolute certainty and every investment is a prediction on future performance. However if you do your homework and invest wisely, you can make money on nearly anything. This is one reason it is so important to choose a self-directed IRA expert who knows the game and can help you play it.Written By Scott Janko, The National Association of Financial and Estate Planning (NAFEP)For more details on the Self Directed IRA go to www.nafep.com

About the author:
Scott Janko is president of The National Association of Financial and Estate Planning. NAFEP is an leader in the self directed retirement planning industry, providing education, training and specialized products to help utilize this unique strategy.

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