- October 1, 2018 at 2:16 am #250647
I’m looking for checkbook control of my previous employers 401k.
It seems as a day trader I do not qualify for a Solo401k as I don’t produce “earned income”.
It seems the SD IRA invested in an LLC is my only option for this checkbook control.
I’m interested in investing in real estate, start up companies, and even Bitcoin, but also want to have some of the unused cash available in a brokerage for stocks.
My question becomes, does my entire 401k have to rollover in to a Self Directed IRA that is completely invested in one LLC?
OR can I have the SD IRA invested in multiple LLCs? as an example a different LLC per real estate ownership?
And can I then also still invest some of this money in the stock market through a brokerage account.October 1, 2018 at 2:23 am #255849
Dock David TreeceModerator
Thanks for your question.
First, let’s clear up a quick item on Solo 401ks. If you already have assets in a 401k, you can certainly roll those funds into a Solo 401k or Self-Directed IRA. When you say that you’re a day trader and don’t qualify for a Solo 401k, understand that you only need earned income to to make new contributions to a 401k. You can roll assets in a previous employer’s retirement plan into a self-directed account whenever you want.
To answer your additional questions:
1. No, you don’t have to roll over the full balance of a retirement plan into a self-directed account. For more information, check out our article on Rollover IRAs here: https://fitsmallbusiness.com/rollover-ira/
2. Yes, you can invest in multiple LLCs through your self-directed IRA. Each LLC would just be a portfolio holding, similar to different stocks in a traditional IRA. For more information, visit our ultimate guide to self-directed IRAs here: https://fitsmallbusiness.com/self-directed-ira/
3. Yes, you can absolutely invest some of the funds in your account in the stock market. However, the best way for you to do this may not be through a self-directed IRA custodian – many of these companies have specialized offerings and charge higher fees for their services. You may be able to invest much more cost-effectively by rolling part of your account over to a traditional brokerage firm like E-Trade or TD Ameritrade.
Hope this helps. Best of luck with your investing.