A self-directed IRA allows you to invest in things other than the stock market. Some of the types of investments allowed are real estate, gold and other precious metals and even businesses.

If you are looking to switch your IRA or 401k to a self-directed account make sure you know the lingo. Knowing the proper terms and what they actually mean can be quite challenging if you haven’t ever heard of them before. We will be talking about three key terms that you will be hearing often throughout the process. These three terms are: Administrators, Custodians, and Facilitators. Knowing these three terms, especially administrator and custodian are very important to know. This is just the first step to making sure you have and know the correct information in regards to self-directed IRAs and 401ks.

Administrator

A company who handles the paperwork required for your retirement account. They help in the formation of the account and maintenance. An IRA administrator typically acts as a middleman between the retirement account owner and the bank/trust company where the deposits and assets are actually held.

Custodian

Custodians hold the actual account assets and investments. They are affiliated with or owned by a bank or even a trust company. They are approved and regulated by the IRS. They are also subject to regulation by the FDIC, their state’s Banking Commissioner and sometimes the Controller of Currency. One thing to remember is that a custodian can be referred to as a “trust company”.

Facilitator

A facilitator isn’t as common as the other two but still important to know. A facilitator is typically a company that gives advice and consulting. It is harder to find IRA administrators and custodians that are facilitators as well. Many do not like to carry the liability that comes with providing advice or consulting.

How do Accuplan Benefits Services and American Estate & Trust Differ from Other Administrators and Custodians?

Accuplan Benefits Services functions as an Administrator.  As an administrator, Accuplan helps open up IRA accounts for clients and handles questions related to IRA accounts.  Accuplan does not hold title or control any of the IRA funds or other assets. Accuplan serves as the expert on retirement accounts and provides all of the client support needed to keep the IRA account in good working order.

• All titling of assets and all IRA funds go directly to American Estate & Trust
• American Estate & Trust is subject to State oversight and annual audits
• American Estate & Trust is subject to an annual audit of its books and accounting practices by a licensed CPA firm
• American Estate & Trust maintains the licensing, bonding, and cash reserves
• American Estate & Trust has all the records and documentation for all accounts and provides all of the state and federal reporting

Why is this difference so important?  Administrators are not regulated in the same manner as Custodians. Their regulations pass to the Custodian they are administering for.  It is the custodian’s job to make sure the administrators are doing everything properly.

American Estate & Trust (AET) is a licensed and regulated Trust company and is in control of all IRA clients’ assets. AET does not give that control to any administrator.  Below are some reasons why your funds are protected through AET:

• AET is a licensed, bonded, and regulated trust company under the state laws of Nevada
• AET is audited annually by the State of Nevada Division of Financial Institutions. Audits require proven financials along with proof of cash reserves.
• As a trust company, funds are 100% available, unlike banks that are required to keep 3-5% of clients’ funds on hand.
• AET maintains cash reserves per state law guidelines.
• AET does not lend or leverage client deposits, nor does it offer checking accounts like a bank does. This ensures that client funds are available and liquid.  AET is regulated by the same laws as other banks and financial institutions.
• AET employees are bonded against theft and dishonesty.
• AET’s principals have undergone FBI background checks.

Now you should know what an IRA administrator, custodian, and facilitator are. If you are in need of any more information as to what an administrator or custodian can do for you, contact us today.