IRA Custodians and IRA Trustees
IRA custodians offer a range of investments for IRA holders. Some can even provide premium annuity options. Banks, credit unions and savings and loan associations typically act as trustees; however, brokerage firms may obtain nonbank trustee/custodian status through filing an IRS form.
Be certain that the custodian you choose provides all of the accounts necessary. Make sure they offer traditional and Roth IRAs, self-directed IRA plans, and HSAs.
Trustee
A great IRA custodian should provide an array of investment options at competitive fees with outstanding customer service and user-friendly websites that allow for informed decisions regarding retirement accounts.
When choosing an IRA trustee, it’s essential that you do your homework to make sure they meet all of your needs. This may involve reading consumer reviews and consulting agencies like the Better Business Bureau to see how complaints are addressed. Furthermore, make sure your account statements accurately reflect investments that may be difficult or impossible to value such as hedge funds.
Your IRA custodian should comply with government rules. For example, IRS regulations mandate that they provide an establishment document and plain-language disclosure that clearly explains its rules – this will protect your IRA against penalties.
Custodian
Every Individual Retirement Account (IRA) needs a custodian who will oversee and safeguard its investments while managing recordkeeping duties and providing ongoing recordkeeping services. This may be done through an investment firm, bank or credit union; additionally a brokerage house, trust company or any other form approved by the IRS may act in this capacity as well.
When choosing an IRA custodian, it’s essential that they possess experience handling all the types of assets you wish to invest in – such as real estate, private placement securities, cryptocurrency or precious metals. They should understand how these investments function from purchase and administration through tax reporting and sale.
Custodians should also offer low fees, particularly with regard to annual account maintenance fees, mutual fund loads and trade commissions. You should look for one with open channels of communication (online or via telephone) so they can respond swiftly and answer all of your inquiries regarding self-directed IRA investments.
Fiduciary
As custodians for self-directed retirement accounts are concerned, it’s vital that they understand alternative asset investment. A custodian should be able to process transactions at the account owner’s direction, conduct due diligence on investments upon request from said account owner and provide IRS reports as requested. Furthermore, knowledgeable specialists should be on hand 24/7 online, by telephone and face to face to answer questions regarding purchasing and selling alternative assets within an IRA.
UBS case provides an example of when commercial custodians may be held liable for breach of fiduciary duty when they fail to fulfill their basic responsibilities. Furthermore, Massachusetts Supreme Judicial Court held that UBS’ fiduciary duties extend beyond traditional roles as an IRA custodian to include best interests duties that could have profound ramifications on industry practices and the ability to invest in alternative assets using IRA funds.
Investment Advisor
IRA custodians offer account holders many financial solutions, including self-directed investments like real estate, private equity and precious metals. However, they cannot approve an account owner’s investment decisions or provide financial advice; account owners should seek guidance from legal, tax and financial advisors before making their retirement plan decisions.
Finding an IRA custodian can be challenging. Do your research to locate a firm that provides all of the services you require at a competitive rate, while being responsive to any questions about self-directed investing and providing educational resources.
An ideal IRA custodian should offer multiple investment options as well as low annual administration fees and global coverage. Furthermore, you may wish to take into account whether there is a local office. Prices for custodial services can differ, and it’s essential that you select one with longstanding reputation and credibility.
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