Page 84 - The Informed Fed--Hearn (edited 10.29.20)

many IRA plans available and dozens of companies outside the
government that will help you in making a decision.
Sorting through all of the options can be a daunting task. The key is
to seek the advice of an expert. You should make the effort to consult
with someone who specializes in this field. When it comes to financial
investing, it is important to read the fine print and do your homework.
It is best to get a couple of different opinions. Every advisor is going to
have their own spin on things, so it is wise to look at more than one
option. With the unstable market we have experienced over the past
several years, you will want to find out the history of the advisor and the
types of financial products they provide. Does this investment they are
recommending have exposure to market risk? Can the gains be locked in
each year? What are the fees if any? These are just some of the questions
that need to be asked.
There are primarily three investment options you have available for
your IRA. Each of these options has positives and negatives. If an
advisor tells you they have an investment option with no downside, put
your hands over your ears, start humming and run! You know this cannot
be true. With no order of preference, these are your most common
options.
1) IRA/bank CD. The upside? Very safe. You are covered up to
$250,000 by FDIC, so there is no way you can lose your funds if
the account is titled correctly. Make sure that if you have more
than one account with the same bank, they are each titled
differently. Most are not aware of the fact that you can lose
money if a bank fails regardless of the FDIC coverage. In order
to have $250,000 FDIC coverage for each account at the same
bank they must each be titled with a different name. Is a bank
CD really a good place for long term retirement investing or
distribution? Not in our opinion. A bank CD is a good place for
temporarily parking money, but not for retirement assets.

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