LAKE MARY, FL, February 04, 2009
/24-7PressRelease/ -- Private retirement accounts such as IRAs, Roth accounts and 401K plans---the patient savings of a generation of workers---could pave the way to a quicker national economic recovery, says one of the nation's leading fund administrators.
Glen Mather, president of Entrust Administrative Services, which provides IRA administrative services to over 2,000 account holders self-directed IRA funds in Florida valued at hundreds of millions of dollars, said private equity investments could fill the lending void left as the nation's banking system recovers.
Most tax-deferred retirement accounts---Traditional IRAs, Roth IRAs, Seff IRAs and Simple IRAs, the preferred choice of small businesses---can be reformatted as self-directed IRA accounts that open the door to a wide range of investment opportunities, from stock markets to private lending for commercial or resort properties.
That, says Mather, represents enormous opportunities for investors---and a big boost for the national economy.
"In the U.S., IRAs is where the money is," Mather said.
Bank startups, new companies seeking startup capital---they're all looking at self-directed IRAs as potential funding sources," he said.
Most IRA accounts are relatively small, Mather said. Entrust Administrative Services clients average about $100,000 per account, but many accounts total well into the millions of dollars.
"Cumulatively, IRAs represent enormous equity that has been traditionally undervalued by the financial markets," Mather said. Younger account owners---Mather's clients typically range from age 40 to age 65---are more astute about finance and the economy and tend to explore their options.
Retirement funds typically earn low but safe returns in the three-to-five-percent range, Mather said. But well-managed self-directed IRAs can earn tax-deferred returns in the 15-20 percent range when invested in real estate or similar vehicles.
"Real estate can be especially productive in this market," Mather said.
"Smart investors who recognize that the real estate market is readjusting are lending about 50 percent of the new value in order to be on the safe side. If the worst happens and they foreclose, they own an asset at approximately half its current value that will produce substantial returns," Mather said.
Mather said some self-directed IRAs are lending operating capital to businesses backed by accounts receivables.
"That has been a market traditionally dominated by banks and private equity lenders," Mather said. "But more owners of self-directed IRAs are stepping in to fill the gap the banks have left," he said.
For more information about this news release, contact:
Glen Mather, President Entrust Administrative Services, Inc. 407-367-3472 gmather@entrustfl.com;
Larry Vershel, Larry Vershel Communications 407-644-4142 Lvershelco@aol.com;
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