1-877-247-2559

What Is a Self-Directed IRA, and Do I Want One?

Is a Self-Directed IRA Right for Me?

A self-directed IRA works like a traditional or even a Roth IRA, except that you—the account holder—make the investment decisions. Typically, this approach lets you invest in things beyond the stocks, bonds and other vehicles that usually are available in the traditional or Roth IRA. Thus, a self-directed IRA might include investments in real estate, mortgages and business partnerships, among other things. Although the account holder chooses those investments, a trustee or custodian, such as a bank or brokerage, handles the administrative details and actually holds the assets. Be sure to consult with a tax professional to help you make the best decisions for your situation.

While Ally Bank doesn't offer a self-directed IRA, our goal is to help you make informed choices about your retirement savings. Always be sure to consult with a financial advisor familiar with your situation to create a retirement plan. With a self-directed IRA, like any IRA, you may want to consider having a mix of investments, so that you balance out some of the riskier holdings with low-risk vehicles, which can include CDs. “One of the good things about a CD,” says Chad O’Brien, a Certified Financial Planner® with Lassus Wherley, “is that [most deposit owners] are FDIC-insured, so there is not really much risk of losing principal, like you might with a bond mutual fund or something of that nature." And, to add flexibility to security, you can spread your funds across a number of CDs with different maturity dates, so that a portion of your money is available on a regular basis.

In addition to making certain you understand the financial underpinnings of your retirement planning, you also should assess your own comfort level as you consider a self-directed IRA. "Some investors just aren't willing to assume the risk that equity markets have, or they just don't feel comfortable with bonds or things of that nature," said O'Brien. "So a CD could play a role in that situation."

Ally Bank offers a variety of CDs and IRA products that can help you meet your goals with just the kind of flexibility that smart retirement planning requires. For example, with the IRA Raise Your Rate CD, you have the option of a one-time rate increase if our 2-Year CD rate goes up; you have the option to increase your rate twice (two times) if our 4-Year CD rate goes up. And our rates are consistently among the best in the country.

Learn more at Allybank.com or call live, 24/7 customer care at 877-247-ALLY (2559).