SELF-DIRECTED IRAs
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Self-Directed IRAs and Ease of Use for Lenders: Past, Present and Future by Clay Malcolm
S
ince their inception, it has always
technological practices to bring
investing and crowdfunding more
been possible to use self-directed
retirement account management into the
accessible to investors of varying
IRAs to invest in private loans. This
modern era. Fully automated account
accreditations and income levels.
includes both originating loans or
management services means quicker
Borrowers and lenders of all variations
buying existing notes. However, the
disbursement of funds, along with quick
likely will be able to connect and utilize
private lending marketplace has
and convenient transaction processes.
their retirement accounts to extend
not always been optimized by selfdirected IRA providers. As retirement investing moves into
Online marketplaces have revolutionized the ability for lenders and borrowers
or purchase private loans quicker and easier than ever before. Innovative technological
the future, innovative technological
to connect and carry
processes have now made it easier
out transactions.
than ever for lenders and borrowers to
Many self-directed
retirement investors
utilize their self-directed IRA accounts.
IRA providers
can easily compare
have integrated
between IRA providers.
their automated
Integrated automated
The Past Historically, self-directed IRA providers
technology with
processes is one of the main features that
services such as the
used paper processes for everything
online marketplaces so
from opening an account to purchasing
investors can utilize their
or distributing an asset. This caused the
retirement accounts to originate loans
via your desktop or smartphone are
disbursement of funds from accounts to
in one seamless process.
good indicators of whether or not the
be a relatively slow-going process. In the past, lenders who were looking to find a borrower had to do
ability to open an account and carry out transactions
provider prioritizes the modernization The Future As we look to the future of self-
of its company’s processes. Automated processes can also be a glimpse into
so manually, rather than connect
directed IRA investing, the evolution of
how much time and effort the account
to an online market. Similarly
investment and banking technology will
owner is going to have to spend
all due diligence processes (like
predictably allow retirement investors
managing his or her account.
credit checks, etc.) were performed
to purchase private loans at the touch of
manually and could be expensive.
a button. Advanced technology should
quick and easy to manage as your
make it easier for IRA transactions to be
bank account, so make sure you have
properly documented and tracked per
a provider who utilizes the most
IRS standards.
cutting-edge technological practices
The Present To stay in-step with modern banking processes, self-directed IRA companies have begun to adopt innovative
26 PRIVATE LENDER
The maturation of the JOBS Act will likely continue to make online
Retirement accounts should be as
to bring your self-directed IRA into the modern era and beyond. •