Invest in Private Equity with an IRA
March 30, 2013 (PRLEAP.COM) Business NewsSelf-directed IRA provider, Silverstone.net, provides checkbook IRA investment opportunities for self-directed IRA investors looking to place retirement account funds into private equity and private placement deals. While the private equity and private placement deals involve greater risk than most public company investments, there can also be greater returns, especially in growth sectors. "The Silverstone self-directed IRA allows smaller, private investors to take part in large private equity deals as preferred shareholders," says Troy Jenkins, VP of Marketing. "It's a great way to massively boost the money in your retirement account very quickly."
Private Placement Deals and Checkbook IRAs
When investing in private equity and private placement, according to IRS rules IRA funds can be used to invest in private stock deals in a preferred way before the deal goes big. This can provide huge returns for IRA investors who are able to get in early, ride the wave of entrepreneurial fortune and cash out, tax-free.
Investing in private equity with your IRA can mean huge returns on a tax-free basis either when dividends begin to be paid-out or when a major liquidity even takes place.
Avoiding Self-Directed IRA Risk in Private Business Deals
Proper business planning can certainly help start-ups and mid-stage companies avoid the risks inherent in new enterprises, but risk mitigation can often prove difficult, especially for new ventures. Moreover, most retirement account investors are less prone to invest in risky projects and business ideas. At least some of this risk can be more easily mitigated when IRA and 401(k) investors pool their resources by investing in private equity deals together.
In addition, private placement investments in later-stage rounds of deal capital financing can be extremely helpful in lower the risk of failure and thus investment losses.
"We suggest those unfamiliar with private equity an investment class tread even more carefully when looking to invest retirement funds," says Jenkins. "As we have seen, some deals don't always turn out the way we would hope and expect. This can be especially hurtful when the lost funds are within one's retirement account."
Silverstone.net is a self-directed IRA provider based in Seattle, Washington. The company works directly with business owners, investors and entrepreneurs to safely access the capital within retirement accounts. With full checkbook control IRA investors are able to place their money in private equity, real estate and precious metals as a hedge against the public markets.