by Tracy W Mitchell
Many people think of an IRA (Individual Retirement Arrangement) as an investment. The fact is, an IRA is not an investment. An IRA is a “type” of money, tax qualified money that must be invested. Although there are numerous IRA investing options available, we will focus our discussion on the three most common categories. Keep in mind that all options have positives and negatives. What you need to do is review the options to determine which choice or combination of choices are in your best interest.
Let’s start with the bank option. This is probably the least complicated of all. The bank will offer you an IRA/CD (Certificate of Deposit) or an IRA/MMA (Money Market Account). The bank offers safety through FDIC coverage up to $250,000 per account. If you have more than $250,000 you will need to open multiple accounts at separate banks. The big downside here is inflation risk. In other words, very low rate of return.
Another option you have is stocks, bonds or mutual funds. With this category, you will be shouldering all of the risks. There are no guarantees and you could lose part or all of your money. If you use a broker or investment adviser you will be paying sales commissions to the broker and an advisory fee to the investment adviser. While this option does have the greatest growth potential, you need to make sure you understand the risks you will be taking and the total amount of fees you will be paying.
When most people think of insurance, they think of auto or homeowners’ insurance. You wouldn’t think twice about insuring your home or auto against loss. Did you know that you can also insure you IRA against loss? Insured IRA programs have been available since the inception of the IRA. The IRA can be insured with a guaranteed insurance contract. There are no management fees and no downside risk. In fact, you have more levels of protection than a bank account. The rates of return vary depending upon the issuing company and the type of policy being used.
About tracymitchell7tm4606
Tracy Wayne Mitchell was born in 1960 in Miami, Oklahoma and is on the Tribal Roll of the Citizen Band Potawatomi Tribe of Oklahoma. He has resided in Springfield, Missouri since 1961. He has been licensed by the State of Missouri Department of Insurance since 1995 to advise consumers on Annuity/Life and Health insurance products. Tracy was honored by American Equity Investment Life Insurance Company’s President Kevin Wingert with the “Seal of Excellence Award” for outstanding achievement. National Western Life presented Tracy with the “2014 Champion’s Club Award” at their world conference held in London, England for top performance and again in 2016 held in Puerto Rico.
Tracy Wayne Mitchell has lectured and trained numerous loan officers throughout the four state area. Additionally, he has conducted a continuing education finance class held at the Lifetime Learning Center in Springfield, MO.
Tracy Wayne Mitchell is owner of Mitchell & Associates Financial, LLC and its subsidiary Federal Employee Benefit Advisors LLC. He has a passion for helping retirees and those about to retire, plan for a successful retirement. He also helps veterans and federal employees better understand their benefits while providing guidance and solutions.
Tracy’s articles on estate planning and retirement investing have been published in
Boomer The Magazine. Tracy wrote a foreword to the book “Maximizing Your Federal Benefits” and has developed a specialty in helping federal employees better understand their benefits and make sure they are on the right track. Tracy authored his own book
”THE INFORMED FED” A Survival Guide to Federal Employee Benefits that was released in 2013 through Tandem House Publishers. The book is available for purchase at Amazon.com. You can tune into his financial radio show every Wednesday at 2 pm on Springfield Missouri’s KWTO AM 560 or stream it live at newstalk560.com. His free newsletter is available by contacting him at: 417-429-0331
Tracy Wayne Mitchell enjoys bass fishing in his time off and lives with Joy his wife of 30 years. They are members of James River Church in Ozark, MO and actively support Christian mission efforts worldwide. They have three children: Laramie Pence: Currently pursuing her Doctorate at the University of Maryland, Cooper: Investment Adviser with Dane
Financial and Connor: Sophomore at OTC in Springfield, MO
Tracy Wayne Mitchell Author of THE INFORMED FED 