When you directly own an alternative asset in your IRA, it must be held with a non-bank trustee or custodian. Both traditional and self-directed custodians will only hold an asset for you as long as it is approved by their investment team. Once approved, the custodian will place its name on the investment for your retirement account's benefit.
In the Rocket Dollar model, your LLC reviews, executes, and holds the investment directly. There is no other party that can interfere.
Self-directed custodians are experienced in holding a more extensive variety of assets, but can enforce an extensive deal review process. These can be frustrating, holding up your own investment objectives and delaying completion of your retirement account’s investment goals.
A custodian’s deal review process is not intended to provide you with fiduciary advice, but rather to protect their own business interests. Your deal may be rejected because the custodian finds it too cumbersome for their service processes, not because it violates IRS guidelines.
Issues such as Fair Market Value (FMV) and other maintenance items can provide friction with a custodian, whereas the LLC model truly empowers you to control the portfolio.
While managing your investments, you will occasionally need to move funds. These transactions could be for a new investment, ongoing expenses, or capital calls. Your LLC business bank account will make it simple to execute these transactions, without the constant review hassle imposed by most self-directed custodians.
Your $15 per month, or $180 per year will help upkeep your the Colorado LLC that Rocket Dollar creates for you.
Rocket Dollar offers a direct held Self-Directed IRA product with a partner custodian for California residents. For more on purchasing or structuring your California Self-Directed IRA, click here.