Interested in investing your retirement funds in Bitcoin? If you want to make the most of the growing potential of this cryptocurrency, then, you might want to open a Digital Currency IRA. First Digital IRA, a company that helps individuals place Bitcoin and other digital currencies in their IRA, laid out the steps on how to buy bitcoin using a self-directed IRA in the video at the end of the article. Learn more about these steps in this article.
3 Steps To Set Up a Self-Directed Bitcoin IRA
The Potential of Cryptocurrency in IRAs
More and more people are interested in cryptocurrencies. Bitcoin, specifically, has tremendously increased in the number of users and traders over the past years. Its value also ballooned significantly from basically nothing. Currently, it is fluctuating between $3,000 and $5,000. So, a number of companies, First Digital IRA included, noticed this potential. Hence, some custodians now allow investors to buy bitcoins using their tax-advantaged accounts.
This tutorial on setting up a Bitcoin IRA from First Digital IRA is pretty quick, simple and easy to digest.
Consult a Digital Currency Specialist
One of the most important rules in investing is understanding the asset you are acquiring. This is no different when purchasing bitcoins or other digital currencies. Consulting a digital currency specialist first before jumping into this type of IRA is always the wise and safe way to go. They’ll discuss with you your options, attend to questions that may puzzle you, arrange needed paper works, and carry out trades that you will approve.
Step 1. Open and Fund Your Self-Directed IRA with a Leading, Qualified Custodian
You need to set up a self-directed IRA first to get your hands on a tax-advantaged digital currency investment. If you have existing Roth, traditional IRAs or any other retirement accounts, there are rollover options available for you. Furthermore, whether you open a new account or roll over your funds, make sure you are entrusting your money to a qualified and legitimate custodian.
As with any other IRA investments, legally your Digital IRA is a different entity from you. Meaning, your IRA technically owns the digital currencies you buy and all the potential incomes are also directed back to it. These accounts share some of the rules on distributions and penalties as other IRA types.
Step 2. Select And Purchase Your Digital Currencies
After hearing your options and understanding these cryptocurrencies with the help of a digital currency specialist, you can now purchase digital currencies using your IRA. Your bitcoins, in this case, will be acquired by your custodian on your behalf through one of their partner exchanges.
Step 3. Store Your Currencies in a Digital Wallet
After purchasing your bitcoins, ask for your custodian’s digital wallet partners to know which one you’ll find the most secure, easy, and accessible to use.
Finally, after your first purchase, you can now buy and sell bitcoins whenever you want through your selected custodian. With the help of your digital currency specialist, who coordinates with all concerned parties to ensure correct and seamless purchases, you are good to go!
Watch the full video below to know more:
Indeed, digital currencies are one of the many investment options available using self-directed IRAs. To emphasize, with the right mindset and the right strategy, you may be able to grow your retirement funds by trading with Bitcoins.
Do you have any tips on investing in bitcoins with a self-directed IRA? Share them with us in the comments section below!