Real estate is a great investment option. While the Great Recession of 2008 sucked the life out of many investments, real estate assets rocketed in value [source: Schnepper]. Many retirement plans allow investors to own various types of property including apartment buildings, co-ops, single family homes and even vacant land. People can invest indirectly in real estate investment trusts (REITs), or buy property using an IRA. Real estate is low risk over the long run with a high-rate of return [source: Schnepper].
A person cannot put property they already own into the IRA. In addition, the funds in the IRA must pay all the expenses on the property including taxes, insurance and repairs. Concurrently, the money you make from the property in sales or rent can go directly into the retirement account.
More Great Links
- Click, Kelli L. "Buy Real Estate in Your IRA." Sept., 1, 2003. (Jan., 2011) http://www.realtor.org/archives/featuresept03ira
- CNNMoney.com "Ultimate guide to retirement: Are there tax benefits to annuities?" (Jan., 2011)http://money.cnn.com/retirement/guide/annuities_basics.moneymag/index3.htm
- CNNMoney.com "Ultimate guide to retirement: What is an annuity?" (Jan., 2011) http://money.cnn.com/retirement/guide/annuities_basics.moneymag/index.htm
- CNNMoney.com. "Money 101 Lesson 23: 401(k)s Top things to know." (Jan., 2011) http://money.cnn.com/magazines/moneymag/money101/lesson23/
- CNNMoney.com. "Money 101 Lesson 5: What is a stock?" (Jan., 2011) http://money.cnn.com/magazines/moneymag/money101/lesson5/index2.htm
- CNNMoney.com. "Money 101 Lesson 6: What is a mutual fund?" (Jan., 2011) http://money.cnn.com/magazines/moneymag/money101/lesson6/index.htm
- Cooper, Michael; Walsh, Mary Williams. "Alabama Town's Failed Pension is a Warning." The New York Times. Dec., 22, 2010. (Jan., 2011)http://www.nytimes.com/2010/12/23/business/23prichard.html
- Fetini, Alyssa. "A Brief History of: The 401(k)." Time. Oct. 16, 2008. (Jan., 2011) http://www.time.com/time/magazine/article/0,9171,1851124,00.html
- Jenkins, Richard. "A simpler way to save: The 60 percent Solution." MSN.com. (Jan., 2011).http://articles.moneycentral.msn.com/SavingandDebt/LearnToBudget/ASimplerWayToSaveThe60Solution.aspx
- Kansas, Dave. "What Is a Bond?" The Wall Street Journal. (Jan., 2011). http://guides.wsj.com/personal-finance/investing/what-is-a-bond/
- Kiplinger.com. "How to Create a Budget." July, 2007. (Jan., 2011) http://www.kiplinger.com/basics/archives/2007/07/moneymanagement.html
- Malvern401k.net. "How to Build an Adequate Nest Egg." Mar. 16, 2004. (Jan., 2011). http://www.malvern401k.net/pdf/Chap6p77-86.pdf
- Mulrean, Jennifer. "7 radical ways to save money." MSN.com. (Jan., 2011). http://moneycentral.msn.com/content/savinganddebt/savemoney/p36019.asp
- Schnepper, Jeff. "Ground your retirement fund with real estate." MSN.com. (Jan., 2011)http://articles.moneycentral.msn.com/Investing/RealEstate/GroundYourRetirementFundWithRealEstate.aspx
- Sutton, Chavon. "43 percent have less than $10k for retirement." CNNMoney.com. Mar. 9, 2010. (Jan., 2011)http://money.cnn.com/2010/03/09/pf/retirement_confidence/
- The Wall Street Journal. "What is a Certificate of Deposit (CD)?" (Jan., 2011)http://guides.wsj.com/personal-finance/banking/what-is-a-certificate-of-deposit-cd/
- United States Department of Labor. "Bureau of Labor Statistics: Consumer Expenditures -- 2009." Oct. 5, 2010. (Jan., 2011)http://www.bls.gov/news.release/cesan.nr0.htm
- United States Department of Labor. "Top 10 Ways to Prepare for Retirement." (Jan., 2011) http://www.dol.gov/ebsa/publications/10_ways_to_prepare.html
- Updegrave, Walter. "Roth IRAs vs. 401(k)s." CNNMoney.com. April 18, 2007. (Jan., 2011) http://money.cnn.com/2007/04/18/pf/expert/expert.moneymag/index.htm
HowStuffWorks looks at the FIRE movement (financial independence, retire early) and finds out how adherents retired so early.