Alternative Investments: Now More Than Ever

I’m convinced that most people don’t know about vast array of alternative investment options available to them including through tax-advantaged individual retirement accounts. Consider the broad environment of alternative investments that we face today:

• We’ve been brainwashed¹ to think that alternative investments are not safe while investments in the US securities markets are safer.
• Financial industry personnel including financial planners, tax advisers and accountants have been led to believe that if they endorse alternative investments then they are in violation of the law. Most have a disincentive to even talk about alternative investments.
• Retail investors are told to ignore the risk of this unprecedented long market rise and ‘dollar cost average’ on market dips. The trouble with this strategy is that investors have limited time horizons to achieve financial goals.
• We’ve told that IRS looks suspiciously on self-directed retirement accounts yet there is no evidence of this for people who follow the tax rules.
• Alternative investments allow us to invest in our own communities, in small businesses and in ways that support our own personal values. Traditional investments make this almost impossible.
• Alternative investments include residential and commercial real estate, development contracts, tax liens, micro-loans, mortgages, secured loans, small business equipment financing, land contracts, private placement stock, startup company investments, farmland, marinas or boat docks, food trucks, and many more types of investment.
• Alternative investments work hand-in-hand with other tax and financial planning strategies with an efficient wealth creation and management plan.
• With the US stock market having set record highs and now showing signs of weakness, there has never been a better time to consider alternative investments.

I welcome the opportunity to discuss how alternative investments may fit into your financial planning.

¹ Explaining the “brainwashed” comment: I began my career as a stockbroker, a registered representative to a large Wall Street firm, and then I worked as an independent Registered Investment Adviser. Now I only work as an accountant/adviser so my services do not include the sale of investments or advice on the trading of regulated securities. However, my work includes important discussion of how different asset classes affect tax and financial planning. My personal belief is that independent advisers, especially CPAs, are best equipped to provide unbiased advice on tax and wealth-building strategies outside of the strong influence of the large financial industry. I now focus some of my client conversations on breaking the brainwashing influence that the financial service industry and the negative effect this has had on middle class investors for decades.