How do you use your SDIRA?

Question

What's your favorite way to use your SDIRA? I've been holding vacant lots & had some success, looking to learn from other peoples' strategies

Sher M · Answer

@Austin Johnson I use my SDIRA primarily for private lending — specifically loans secured by real estate. For me, it’s been a predictable and reliable way to grow the account without relying on market volatility.

Here’s my approach: I lend the funds out, collect monthly payments (principal + interest), let the balance build back up, and redeploy into the next loan. Rinse and repeat. With this approach, I am on track to double my account in five years without adding any new contributions.

Happy to share more or answer questions if it’s helpful. Feel free to DM me anytime.

Brett Synicky · Answer

@Austin Johnson My go to private lending secured by real estate.

Ashish Acharya · Answer

@Austin Johnson, Great question! Using an SDIRA for real estate is a smart move. For vacant lots, it works well if you're holding for appreciation. If you're into property flipping or rentals, those can also go in your SDIRA, just make sure all transactions are handled properly to avoid penalties. You could even lend money through your SDIRA and earn interest without managing properties. Good luck and happy to connect!

Chris Seveney · Answer

I recommend going the lending route, reason being is it is typically taxed that ordinary income rates and using self directed IRA you avoid that. Whereas if you invest in real property, you do not get any of the benefit benefits of depreciation or tax savings

Brett Synicky · Answer

@Thomas Talbert

Those things you mentioned are active businesses and would trigger UBIT in an IRA/401K. Ok and allowed but know the implications before getting started.

Thomas Talbert · Answer

That's exactly why you join bigger pockets! I'll be sure to double check

Thomas Talbert · Answer

I am working on just filling the account at the moment. I have been thinking about using my existing business to stand up other companies within the SDIRA. Things with low overhead and lots of cashflow to get the account growing quickly, Something like washer and dryer rentals or yard maintenance, etc.

How do you use your SDIRA?

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