What Exactly Is a Crypto IRA Account?

As a leading-edge retirement vehicle, an IRA that features crypto represents an investment opportunity that can significantly add value to your retirement portfolio. While crypto may be a speculative investment, it also offers excellent rewards for those who look at its benefits. Plus, investing in an IRA with crypto will save you money on taxes. Therefore, there really is no downside to using this IRA to save for retirement.

So, what is involved in opening up an RA that features cryptocurrency? What are your options and how does this account work? The following information will detail the benefits of enrollment and why you should not miss out on this financial opportunity.

The Crypto IRA Account: How It Is Set Up

A crypto IRA account from Viva Capital offers an exciting way to start saving for retirement, mainly because you don’t have to pay taxes every time you realize a gain. Therefore, an IRA shelters your crypto investment so you don’t pay taxes each time you earn money on your trades. This makes adding this account to your portfolio a “must-do” activity.

While crypto trading may be volatile and speculative, it is beginning to stabilize, given the popularity of crypto currencies such as Bitcoin, Eretherum, and Lite Coin. When you open up an IRA that features crypto, a custodian will handle your application and manage your contributions and withdrawals.

Crypto is traded on its own exchange, just like stocks and bonds, so it is easy to make trades through your account manager. Once a trade is transacted, the money is held in a digital wallet – one of the most secure ways for keeping your investment safe.

Also read: Cryptocurrency Wallet: All You Need To Know Before Start Trading Crypto Currencies by Brian Colombana

Rolling Over an IRA or 401(k)

An IRA that features crypto is a specialized IRA, also called a self-directed IRA (SDIRA). A self-directed IRA is an IRA that features alternative investments, such as crypto, platinum, artwork, or gold. Traditional IRA accounts are used for investments, such as stocks, bonds, ETFs, REITs, and precious metals, including silver and gold.

You can rollover part or all of a traditional IRA into a crypto SDIRA. You can also keep the accounts separate. It is totally up to you.

Money can be rolled over from a traditional IRA or 401(k) into a new digital SDIRA, or you can establish a separate account.

Rollovers may be direct or indirect, with direct transfers being the norm. To facilitate a direct rollover, your custodian will rollover the money (all or part of it) into your new IRA after the account has been set up.

An indirect rollover entails receiving a check in the mail and adding the money to your new account within a certain time frame – in this case, 60 days. To avoid paying taxes or a penalty for early withdrawal, make sure you add the money immediately.

Final Thoughts

If you are working at building wealth for retirement, you want to look carefully at the benefits of investing in a crypto SDIRA. This inventive financial vehicle can provide an excellent return on investment, which will make your life more comfortable during retirement.