Why do some people buy 'Tax Sheltered INVESTMENTS' into 'Tax Sheltered ACCOUNTS'?

Question

Why would someone buy an annuity in a self-directed IRA?
or
Why would someone buy REIT's/ LLC's in a self-directed IRA?

Answer 1

It doesn't make sense. Many insurance people are looking only for a commission. I see it all the time, it is very sad. Most people dont know what they are being put into. Of course an IRA is tax-deferred arrangement----there is no reason to put a a tax-deferred investment into a tax-deferred investment....except for the commission. We really have to be informed in order to not be talked into something that is detrimental to us. No wonder people hesitate to talk to me about planning, there are so many crooks out for themselves----they just want to hit and run. A good financial planner will take the time to do it right, yes, it will cost a bit of money, but a good one will NOT put you into this kind of thing. And dont think because the person has a designationi like the CFP they are perfect and will care about you....that's crap....Ask to see a sample plan and have them be very specific about costs---like commissions.
I see TSA's or 403Bs put in annuities all the time and they should have just been rolled over----why the annuity? The commission, I hope they sleep well. Watch out for a company that starts with a and ends with e......they do this all the time---SAD!
I cant do it that way. Good luck to you, great question.
CG Financial Advisor

Answer 2

One benefit of rolling a 401k or an IRA to an annuity is the living benefits. If you roll it into let's say a brokerage account and buy mutual funds, there's no "guarantee" you're going to make money, etc. Some annuties (which have fees, etc) can provide lifetime income. For some people, it's worth paying an extra few percent a year so that they have income for their life & the life of their spouse. You insure your house, your car, etc. Why not "insure" your retirement?

Answer 3

Annuities are the only way to guarantee the principal and/or an income stream in retirement. REIT's pay income but are not tax sheltered as you imply. To say it is a bad idea is silly as that person has been spoonfed by the media. Find me another way to capture upside and guaranty no loss of principal, plus get me a death benefit to my heirs in my IRA. You can't unless it is with an annuity. Yes, people are paid to sell those but in the right, not all, situation they are powerful tools. Do not buy them form a bank or large brokerage firm as your choices are limited. Use an independent advisor.

Answer 4

Obviously, TSA's shouldn't be purchased within an IRA for their tax benefits. They're often prurchased within a qualified account for the death benefit or the guarantees. Other than that it serves a double purpose.

Answer 5

Then the IRS may be hounding your ***. on account which you could purely make contributions $sixteen,550 into your 401k consistent with twelve months, with exceptions made while you're over 50, you're able to make contributions one greater $5,500. apart from, this 401k money which you legitimately make investments isn't tax loose. it is tax deferred. you would be paying the taxes on that, quicker or later. definite, you could deduct many stuff as agencies expenses. and could the IRS ever audit you, you will could desire to take care of those deductions. while you're very liberal with your deductions, sturdy success with that on account which you would be wanting it. and those prosperous human beings which you look to believe pay no taxes, actually pay the main. in accordance to IRS records, the suited a million% of income earners pay 40% of this united states's income taxes.

Answer 6

Because it's a great source of income for the "Financial Adviser".
Otherwise.... anyone that has spent a small amount of time learning this stuff wouldn't do it.