2007-10-24 02:40:00 · 11 answers · asked by kathie a 1 in Business & Finance ➔ Investing
You can either invest in REIT's which are real estate investment trusts, or if you are interested in utilizing IRA funds to invest in real estate it is possible. It takes a specialized broker to assist you in making those transactions, and there are plenty of regulations.
2007-10-24 02:43:16 · answer #1 · answered by 10SNE1 2 · 0⤊ 0⤋
Is it possible to create a company, roll the 401k into an IRA, and invest your IRA in that company's stock? That way you wouldn't pay the penalty. I'm not sure if an IRA needs to be invested in publically traded stock but it's worth looking into. Edit: If you can't do the above, it depends how much money is in your 401k, how much you will need for retirement, your current age, etc. Remember you're taking a 10% penalty off the bat for removing $$ from your 401k, so you will need real estate returns of 11% above what you would get from your 401k in order to break even the first year. Then again, if you can rent out the additional properties and increase your cash flow, they will pay for themselves while you reap the benefits of capital appreciation. With the housing market the way it is, you should be able to make purchases at very good prices. It's a tough call and there's not enough information to give you good advice.
2016-05-25 10:59:02 · answer #2 · answered by ? 3 · 0⤊ 0⤋
If you are talking about investing in real estate like some property up the street then the answer is if your plan allows it you can but it's one of the worst type of investments that you can have in a retirement account. You have to have an outside trustee run the books and get an annual valuation of the property. That combined with the fact that you can't run any losses through your personal tax return makes it a silly investment. It could very well end up being a money pit for you...
And, to top that off....you may not be able to sell it when you need to at a value that you need to get out of it. Example: let's say you turned 58 last year and want to retire at 62...you may not even be able to sell it before you turn 62 and may have to sell it at a loss even then.
2007-10-24 03:14:57 · answer #3 · answered by digdowndeepnseattle 6 · 0⤊ 0⤋
If you are also the plan sponsor, maybe. If your are a rank and file employee, no. If you are the sponsor you need to be mind-full of ERISA requirements. Although you can get real estate into a plan does not mean it is a good idea. The department of labor will have some terrible news for you should the investment go south.
2007-10-24 02:43:43 · answer #4 · answered by Anonymous · 0⤊ 0⤋
One of the only drawbacks of a 401k is that you can only invest in funds that they select.
If one of your fund choices is REIT, then you can invest in that.
There is no way that I of to invest personally in any sort of rental real estate.
Common wisdom is that you never put rental property in a retirement account anyway.
2007-10-24 02:45:55 · answer #5 · answered by Wayne Z 7 · 0⤊ 0⤋
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2007-10-24 03:01:36 · answer #6 · answered by Anonymous · 0⤊ 0⤋
Only if your specific 401(k) plan offers it. If you mean can you do it through an IRA I believe you can. I am certain you can if it is in a fund or REIT within your IRA account. IRAs refer more to specific tax treatment than investment restriction.
2007-10-24 02:44:48 · answer #7 · answered by Anonymous · 0⤊ 0⤋
no, but there are funds that invest in real estate, so you can do it through that means.
2007-10-24 02:42:34 · answer #8 · answered by howie r 5 · 0⤊ 0⤋
It depends on the structure of your 401(k). But you should keep your investments diversified.
2007-10-24 02:43:43 · answer #9 · answered by Anonymous · 0⤊ 0⤋
if it's in my name you are WELCOME to invest :-).
2007-10-24 02:42:46 · answer #10 · answered by crazy suzy 2 · 1⤊ 1⤋