Lots of people are wondering what to do with their money in these days of a turbulent stock market and terrific uncertainty in the economy. Susan asks a question related to this that is on the mind of many:

Q: We have a very large amount of money in Ira acct I realize this is not a good position to be in. We are ages 49 & 51
We are in high tax bracket this year. If you were in this position would you take your money out and if so what would you do with it? I have a feeling you will say yes and reinvest in commercial real estate. It would be hard to stomach paying $200,000+ in penalties, taxes. Would like your best advise

A: Get educated. Before you do anything, you must have the education to be able to decide what you are going to do with the money. Next, you must have a wealth strategy. This is a plan of action to get from where you are today to where you want to go. It includes a decision about which asset class you will invest in, whether it is business, real estate, stocks or commodities. It include a decision about which type of asset you will invest in within the class you decide upon, e.g., will you invest in commercial, residential or industrial real estate.

Only when you have a clear wealth strategy can you make a good decision about whether to pull your money out of your IRA. For example, if your wealth strategy is based on investments in gold and silver, there would be no reason to pull your money out of your IRA. You can invest in gold and silver inside your IRA and defer the taxes (or eliminate them if you choose to convert to a Roth IRA). The same is true if your strategy revolves around the stock market. On the other hand, if you are investing in real estate or business, you may want to pull your money out of your IRA, pay the taxes and penalties, and reap the tax savings and investment returns that come from the leverage you can get in business and real estate.

So don’t do anything until you first have the education and the wealth strategy to know what to do. For education or If you would like help with creating your wealth strategy, feel free to call our office at 866.467.5809 or send us an email at cs@provisionwealth.com and we will be happy to give you some additional direction.

Warmest regards,

Tom