What alternative asset is right for you? (Part 4: Private Lending)

Estimated reading time: 1 minutes, 55 seconds

In Kingdom Trust’s “What alternative asset is right for you?” blog series, we provide some reasons why an investor will choose one asset class over another. Not everyone goes into a Self-Directed IRA knowing what investment best serves his or her individual needs; Kingdom Trust is here to provide a few examples of the mindsets, the interests and the experiences that lead someone to choosing an alternative asset.

In this last post in the series, Kingdom Trust will give you reasons why some investors may choose a private lending investment.

Have experience with IOUs or take-back mortgages? Perhaps you’d like to see a pre-established return on investment with a similar type of loan using tax-advantaged funds. Perhaps you want to name your own repayment terms and interest rates, the latter of which you want to set above the current market rate.

Let’s say that you are comfortable offering credit to individuals or private companies—you may have even done so in the past with regular funds. Maybe you want to offer credit to fund a real estate project or other type of business investment to solid borrowers either unable or unwilling to obtain bank financing.

Or perhaps you know a great deal about the mortgage industry and want to loan money to individuals looking to purchase a home. You’d like to secure the loan with that property but want any taxes on gains deferred or even have the interest payments tax free.

If any of the above sounds like you, you might want to consider investing retirement funds via a Private Lending IRA. With this type of alternative investment, you have the opportunity to lend retirement account funds to other individuals or businesses via secured debt, a private debt offering by a business entity or an unsecured promissory note—all using tax-advantaged retirement funds.

When determining a self-directed investment, be sure to choose wisely and consider all possible risks when investing. If you feel like a Private Lending IRA is for you, then look to Kingdom Trust for your alternative investing solution!

We’re here to walk you through the process every step of the way, whether you already have an account with Kingdom Trust and are ready to make a new investment or you need to open an account first. And if you’re still undecided, contact us today with any questions you might have!

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