Are any of you using self-directed IRAs to invest in "alternative" assets?

[tenant13]

There have been a few threads around about using SDIRAs to invest in real estate but I started looking into other assets - specifically cryptocurrencies and precious metals. I'm way up this year due to having too much Apple stock and my travel budget will very likely remain unused for a while so I have some money to play with. My specific questions are about storing these alternative assets. This is a good primer: https://www.sunwesttrust.com/news/home-storage-gold-ira/
My specific questions:

1. Do any of you store physical gold in the SDIRA LLC rented safe deposit box at a bank you have easy access to (not some Delaware depository)?
2. Has any of you purchased cryptos with your IRAs and if so how do you store them - I do NOT want to leave them on the exchange and would rather move them to a cold storage, like a Ledger wallet purchased by my my SDIRA LLC. The thing is cryptos are not tangible. It's just a computer code the lives on the wallet but so as long as you know your private keys/mnemonic phrase you can recreate that wallet anywhere and anytime.
3. Have you been approached by IRS about your SDIRAs (no matter the holdings, real estate including) and how did that interaction look like?

This is not a question about the soundness of SDIRA's investing. I'm perfectly diversified at Schwab already and am sitting on a bigger pile than I can spend. As I mentioned it's my play money. I'm just curious if anyone has some real world advice and experience investing in physical gold and cryptos with their IRA. I'm not interested in gold futures, funds, mines and the likes.

 

[OldShooter]

Start with your custodian. Find out what assets they will permit. Rules vary.

A number of years ago I was fairly active buying private placement stocks. IIRC the promoters had usually bird-dogged custodians who were willing to hold the asset. For a time, too, Schwab would hold that kind of asset, but they cut that off a decade or more ago.

I doubt that you will find a convenient custodian willing to hold physical assets. Also, IIRC the rules you cannot borrow against real estate held in an IRA. The loan is considered to be a distribution.

I would not use the word "investing" in connection with cryptos. The more accurate words are "speculating" or "gambling." Both can be fun in small doses and you don't have to drive to the casino.

 

[tenant13]

Start with your custodian. Find out what assets they will permit. Rules vary.

A number of years ago I was fairly active buying private placement stocks. IIRC the promoters had usually bird-dogged custodians who were willing to hold the asset. For a time, too, Schwab would hold that kind of asset, but they cut that off a decade or more ago.

I doubt that you will find a convenient custodian willing to hold physical assets. Also, IIRC the rules you cannot borrow against real estate held in an IRA. The loan is considered to be a distribution.

I would not use the word "investing" in connection with cryptos. The more accurate words are "speculating" or "gambling." Both can be fun in small doses and you don't have to drive to the casino.

I'm not sure what the rules for links posting are but here's the SDIRA company I'm looking into (by no means is this an endorsement): https://www.rocketdollar.com. They're fairly inexpensive, transparent, informative (their knowledge base and podcasts are good) and hands off but very good at communicating. They also have interesting investment partners (I was specifically looking into dropping some money into mini storage).

I definitely agree about cryptos but I just like the idea of supporting something that seems like the only viable alternative to central banking. Plus I enjoy its built in anti-censorship/libertarian feature; as long as it's accepted as a method of payment no financial system will be able to cut you off from transacting (think of PayPall banning payments to certain organizations) as it's completely decentralized. Is it Gold 2.0? Who knows... Whether BTC survive or not is anyone's guess. I'm willing to make that bet.

 

[OldShooter]

... https://www.rocketdollar.com. ...

A 14-employee company not registered with the SEC (https://brokercheck.finra.org). What could possibly go wrong?

I wonder if they are regulated by anyone. https://www.rocketdollar.com/disclaimer

 

[tenant13]

A 14-employee company not registered with the SEC (https://brokercheck.finra.org). What could possibly go wrong?

I wonder if they are regulated by anyone. https://www.rocketdollar.com/disclaimer

This would have been a concern if they were a custodian and, say, hold the title to the real estate property. But all they do is provide legal framework for opening a Colorado based LLC and the FDIC insured checking bank account own by the LLC and controlled by me aka the custodian. It's really my responsibility to follow the IRS regulations (and make investment decisions). Given that the funds are actually deposited at the bank and not RD I think I'm comfortable with this setup. RD is a fintech so 14 employees sounds about right for something like SDIRA - it's a niche product anyway.

 

[OldShooter]

A career in high tech has taught me that the guys out front are the ones with arrows in their chests. So I don't mess with situations like this YMMV, however, and I wish you luck.

 

[aja8888]

Reading the Bio's of the head guys in this firm, it looks like they had pretty good jobs before this adventure. I wonder why they are not still at those good jobs (Google, Merrill Lynch, etc).

It's not clear exactly why you would need any help from this firm.