How to Transfer Funds into a Self Directed IRA
To transfer funds to your self directed IRA, you need to work in conjunction with a custodian to ensure that all government regulations are followed. This is not optional. It’s mandated by law.
The only duty of the custodian is to set up your account and to oversee it. They do not advise you on investments or profit in any way from the investment decision you make, that is between you and your professional advisors.
Once the custodian has opened your self directed IRA, you will fill out a form commonly referred to as a “direction of investment” document. This form in essence tells your current IRA administrator/account manager where to send your IRA proceeds.
To expedite the process when transferring retirement funds into a self directed IRA, it is recommended that you go from like account to like account. In other words, if you now have a Roth IRA, it is recommended that you transfer funds into a self directed Roth IRA. If you wish, you can transfer again into another type of self directed account at a later date. The goal initially is to gain control over your account funds so you can start investing.
How Long Does It Take to Transfer Funds into a Self Directed IRA?
Depending on which type of transfer you’re making, it can take anywhere from a few days to a couple of months. A cash transfer is the easiest and most rapid transfer. It only takes a few days.
Once your self directed account has been set up and the proper paperwork forwarded to your current plan administrator or IRA custodian, the wait time depends on them. Due to your 7 day legal right of rescission, funds cannot be invested until this initial period has lapsed.
If you’re transferring from a brokerage account, for example, it can take a couple of weeks. If you’re transferring from an employee-based IRA, it may take up to 3-4 weeks.
No matter how long it takes, the freedom of maximizing your retirement fund as you see fit is one that’s well worth waiting for.
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