Don’t think self-directed IRAs are important? Think again!

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Don’t think self-directed IRAs are important? Think again!

By admin | January 9, 2010

While many Americans are far too passive about their IRA accounts, the Government is counting on them to help fund the future of an aging America. Evidence of the fact can’t be more profound than yesterday’s announcement by the FDIC that insurance on Self-Directed IRA and qualified plan (e.g., 401(k)) cash deposits will be increased on April 1, 2006 to $250,000 from the $100,000 level put in place 26 years ago! In fact, in its announcement, the FDIC indicated it was accelerating the implementation of the increase, originally scheduled for the third quarter of this year, to encourage IRA contributions for 2005 which can be made through April 17th of this year.

Investors need to do nothing to receive this additional coverage other than to have IRA deposits with an institution like a trust company, bank, credit union or savings and loan that provides FDIC insurance. Money market accounts (e.g., at brokerage firms), annuities, mutual funds, stocks, and bonds do not receive FDIC coverage. It should also be noted that the coverage for non-IRA deposits will remain at $100,000.

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