What is Self-directed Investing

The Internal Revenue Service allows you to self-direct your investments in most types of retirement plans as well as educational savings and health savings plans. An IRA is a personal savings account that allows you to contribute annually for your retirement savings. It provides either a tax-deferred or tax-free way of saving for your retirement. There are many different types of IRA accounts, though Traditional and Roth IRAs are the most common. Besides IRAs, all of the following types of retirement, educational savings and health savings plans can be set-up or modified as self-directed plans:

• SEP IRAs
• SIMPLE
• Individual(k)
• 401(k)s
• Defined Benefit Plans
• Profit Sharing Plans
• Coverdell Education Savings Accounts (ESA)
• Health Savings Accounts (HSA)

Just because your plan has a self-direct investment option does not mean you are on your own. It means you have the control to make your own investment decisions, if you choose to do so.

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