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Trading Futures and Forex in a Retirement Account

Investing In Futures and Forex With Your IRA

Most investors are looking to maintain their current standard of living once they reach the golden years of retirement but with Social Security uncertain, saving on their own has jumped higher on the list for most US workers. Trading futures and forex can provide diversification for your retirement account.

As of mid-2017, 35% of US households owned IRAs with a mean asset value of more than $88,000 according to an Investment Company Institute study. 57% of those IRAs also contain rollover funds from an old employer 401(k).

With money available to invest, IRA owners are looking to preserve their assets and improve their diversification in an unstable  – and sometimes quite volatile – market.

Preserving assets over the long haul becomes easier for investors when they’re allowed to pursue options they know and understand. For many, those options lie outside the realm of the traditional stock and bond markets typical at a large custodian and fall into the category of alternatives – including futures and forex trading.

Trading Futures and Forex

Futures and forex (foreign exchange) trading has been allowed in IRAs since they were established in 1974 and there are some real benefits to both the investor and futures professionals. We’ll look at the benefits for both groups.

On the investor side, adding futures to a retirement planning strategy can mean investing in something they have worked with or around for decades – allowing them to use their in-depth knowledge and expertise to benefit their retirement. Futures also adds a dimension of diversification and can help hedge against losses in other markets.

On the professional side, offering the IRA option to your clients can help you serve your clients better because most investors are misinformed and don’t realize they can even use IRAs to invest in futures or forex. Offering IRAs can also grow your business by doubling the number of accounts you establish per customer – personal and IRA.

Futures and forex trading accounts can be held in any type of IRA including; Traditional, Roth, SEP, SIMPLE, and Solo 401(k) plans. These plans allow individuals to save for retirement tax-free or tax-deferred and gives professionals an alternative source of funds that their clients can use.

So if you’re looking to grow your business, consider offering your clients the IRA option – you’ll both benefit.

Contact Midland

If you have questions about trading futures and forex or would like to open an account to start diversifying your retirement portfolio, contact Midland Trust.