How to Invest in Bitcoin and Other Cryptocurrency with a Self-Directed IRA or 401k

Foreign. Welcome, everybody, to this week's episode of the directed IRA podcast. My name is Mark Kohler, the less important one. Let's just make be clear about it today. This is a big deal. I've already been prepped by my amazing partner, Matt Sorenson, to just hang on tight.

Yeah, you are a vip, though. You're still a very important person. But what Mark's referring to here is I'm going to be doing more of the today. But don't, don't, you know, end the podcast now. Okay, Mark's got some jokes. I'm sure you know. Yeah, this is just gonna be the boring Matt Sorensen show. And, but I, I mean, I've been geeking out on this topic for a while and we have a lot of awesome strategies on how to buy crypto in an ira. We're gonna go over how to do it without an IRA LLC, how to just do with your, an IRA and a trading account, how to do an IRail OC if you want to to do your keys or do keep your private keys or buy some alternative crypto. I'm even going to go over how you can buy some of these Bitcoin ETFs and why you might want to consider them or not consider them. So we're going to walk through all these different options out there that are playing out for our clients at Directed IRA who are wanting to buy crypto. This asset that's kind of like taken everyone's attention over the last few months.

Yeah. And if you're new to this podcast, welcome. Someone may have shared this with you. You've been able to find this trying to get some straight answers on what your options are when you invest in crypto. Matt and I, between gosh, two or three variations of our podcast now have over 500 episodes over the last 10 years. We've been helping small business owners around the country in our law firm for 20 years, our accounting firm for over 15 years. If you go out and start googling our names, you're going to find hopefully a lot of good stuff. If you do images, you might see Matt with his masculine upper body self. Me, I'm just an old guy.

No, those images do not exist.

They don't do this, do they?

No.

Do not search for that. But we're glad to have you here. We try to keep it light. We try to have fun. I'm a CPA and an attorney, partner in both the law firm, accounting firm and CFO of directed Iraq. Matt Sorenson, also a tax lawyer and author of the book the Self Directed IRA Handbook and its second edition, the most selling book in history on the self directed IRA topic. It's gotten rave reviews. You get over on Amazon and check that out. If you get to the website, sdirahandbook.com that's SD as in self directed irahandbook.com we always recommend everybody get a copy of that so that you can really dive deep onto some of these topics. Because this is a. This is a tricky one today. And as Matt said, I'm just gonna, you know, I'm gonna be allowed. Apparently I'm in the backseat. I'm just gonna be allowed to make a comment once in a while. Now I'm just playing. Matt's really nailed this down because as CEO of Directed Ira, Matt has really just driven the ship here on trying to get the most smooth and easy and effective way to invest with crypto. If you're into crypto, if you're not, it's cool. But, Matt, the time is yours. How would you like to proceed? What is. What is our outline for today?

Okay, well, let's go over the three options first. And I mentioned them at the beginning here, but I want to.

Okay, hold on. I want to interrupt you. No, I'm just joking. You knew that was. Sorry. See, I'm just trying to keep you on your toes.

That's actually normal. I was prepared for that. I was ready. Okay.

I shut up now. I'm just playing. Okay, three things.

Okay, we're gonna hit the three options and we'll dive into each one in detail. The first thing I want to say is if you've heard us before on this, we've typically recommended an IRA LLC as a way to do this. There are other options. Now, that's still an option for certain people. I think it's a good option, but it's not the only option. And there's a new one that's better for most people. Okay, so let me walk through these three options and we're going to share my screen here. So for those of you listening on audio, if you want to jump over to the YouTube, you can check it out on the YouTube channel. And yes, Mark, can I raise my hand? Am I going to call on you like the teacher? Yes. Yeah.

Now, for those of you also that are new to this, we are on Stitcher, Spotify, itunes, every podcast form you could think of, but also on YouTube, so. So for those that want to see our faces, you'll see me with a little more dramatic faces and looks here and there, too. But I just raised my hand because I want to say, Matt, you said that there's people that may be listening to this that don't even know what self directing is. Do you want to hit that now or is that in your first slide or two? I don't know, I just want.

Let's hit that now and then we'll go over the three options. Okay? So the first thing is if you have an IRA or 401k, let's say you're a Fidelity or Merrill lynch or wherever and you're like, alright, I want to buy crypto with my ira. You're like, can't do it. You can't own crypto with an IRA. And it's not because IRAs cannot own cryptocurrency, it's because IRAs at Merrill lynch or Fidelity can't own crypto. Okay? They don't sell that yet. Alright? They, they sell stocks, bonds and mutual funds. That's what you can buy when you have a retirement account there. So you'll need to move your account from, let's say Fidelity or Merrill lynch or TD, wherever you over to a custodian of IRAs who lets you self direct. Like our company directed IRA. Mark's wearing the directed IRA colors today and so I appreciate that. Always selling marks. He's such, you know, such a good, good co founder. So that's step one is just realize that if your IRA is somewhere out, you're going to get to a self directed IRA custodian. Now we're really leading on many of the strategies on this, so why not just come to us and we have the best service and we're the best, you know, wow. We're just the best.

Bold, bold statement. And for those of you, and this would be our last comment in this because I know many, many of you that already know self directing are here to learn about this crypto thing. So I'll just say this. If you're still a little hazy on the self directed IRA or 401k SEP, HSA, all those Roths. If you're a little hazy on the process or need a refresher course, go back to the beginning of our podcast. And we really tried to structure our first 10 episodes just breaking down the basics and if you just binge on those, you'll be set. Okay, so Matt, you got a PowerPoint. This is new. This is new for our show. A PowerPoint. So you got to get over to YouTube, folks, you might find this helpful.

Yeah, yeah, we're going to be doing a Webinar on this. We're going to be, you know, we're going to be turning over every stone to make sure they know about what you can do, how you can buy crypto with an Iraq, whether you should do it. I don't know. Okay. I mean, by my last video on this, when we kind of got big in this in 2017, Bitcoin was at 2500 bucks. And that's what I said on that video. I'm like, I don't know whether you should buy this or not. Seems pretty speculative, you know, but if you want to, here's how to do it. That's still our message today. Of course, Bitcoin's at 50,000, so, yeah, that's a 20x return right there.

All right.

Okay, let's, let's share my screen here. Okay. And I'm going to show you. This is option one.

Okay.

This is where your IRA can own Gemini trading account. And you. So you're going to do two things. You're going to set up a Directed IRA crypto IRA account. This is a specific IRA account. We're doing it Directed IRA. It's separate from our other IRAs.

Can it be a Roth or traditional?

Yeah, Rock, Traditional, hsa, Solo K. All right, esa, all those will work. All right, we have all the apps ready to go@directed ira.com where you can start now. You can do this structure now. Okay, so I'm gonna get my crypto IRA account and what we're gonna do then is we're gonna link and set up a Gemini trading account. So Gemini is a trust company. They're one of the largest providers of crypto and they have an exchange, they have a wallet. And so your IRA is going to own this trading account and you're going to be an authorized trader on the Gemini trading account. We are going to move money from your crypto ira. Let's say you transfer it over from your Fidelity account, and now it's over here at directed ira. We're going to then invest the amount you want into this Gemini trading account, which will go in cash. And now you have trading authority and can log in. You have to get, you know, you set up a login and stuff. There's a process, but your IRA owns it directly.

I love it. I was just going to say in more baby step format for some of you. Step one. I was actually on the Directed IRA website last night setting up another IRA for myself because April 15th, right around the corner, I wanted to get my backdoor roth funded for 2020. So I was there as well and I was actually emailing Matt and some of the staff going, hey, can we change this button here or there? So I just love the website, it is very user friendly. But you set up your account, step two, move the amount of money you want into that crypto IRA account. Matt kind of said that after, but I think that's really step two, set up the account, move your money in there, which could be very, very quick. There's no tax, there's no penalty. It's kind of like a rollover. You just move that money to a different broker, as some people might think about. Then step three, you're opening up that Gemini account and we're gonna open it for you.

And it's owned by your ira. We're trustee of your ira. We're gonna open up for you but make you a trader on it. So that's the cool thing because this has been one of the disconnects in crypto is alright, well I want to have access to trade this. Now some IRA custodians like, okay, give us an instruction and we'll go buy it for you. Well, crypto trades 365 days, 24 7. Like is your IRA custodian. Some of our competitors, are they able to trade at midnight on a Saturday? No. And if crypto falls fast or it's rising fast, you want to make buy or sell purchases. How can you do that? You're going to submit a form and have this manual process for them to then go make the trade. How quickly are they going to do that? Are going to charge you expedite fees? It's a mess. It was a terrible system. Like there's no way in heck we're going to do that. Not to mention their fees are ridiculous. So what we're doing is we're trying to say, all right, what, what would I want really if I was going to trade crypto? Let me have the controls. It's your ira. We're going to put the money in there. You get to decide when to buy and sell how much. You can do it 247 in your pajamas at your house.

Okay now Matt, let me just say last of the steps and then also is if I move 10 grand into my self directed Iraq crypto account, do I have to move the whole 10 grand to Gemini or do I tell you how much I want to put in Gemini or just by linking it by if in effect your 10 grand is in Gemini, will it be there?

So keep going.

I know that's Next step.

So, yeah, most people are just going to have it all invest. And we have an option in the account app to just say send all my available cash. So if I'm rolling over money from Fidelity or I make a new contribution, let's say I'm doing the backdoor Roth for six grand or. But right now you can do 2020 and 2021. So you'd be put in 12 if you didn't make any 2020 contributions. So we have an option. We said the account to just say, just send all available cash to the Gemini Trading account because otherwise it's not doing anything. It's just going to sit in cash in our account. And we have no minimum balance on the crypto ira. So you don't need to leave cash over at Directed any. All the cash you want can go over to Gemini. And of course you'll have a credit card on file at Directed ira. Or we charge your account fees. All right, now here's what's cool at Gemini. So you have one of the largest exchanges. Okay. There's no fees to store your crypto there. Your, your crypto is on the exchange. I'll get into some storage options here in a moment. But it's just on the exchange. But Gemini has all the major crypto. They have Bitcoin, ethereum, litecoin, and 20 plus cryptocurrencies that you can trade essentially on the Gemini trading platform.

Okay, I love it. So easy now. And I guess I would, if I wanted to look at either account, if I logged into the Directed IRA account, I would see that I have X dollars put into that ira. But if I wanted to see what the specifics of the holdings and value were, I'd log into my Gemini account and I could probably have two screens saying, okay, yeah, all right.

Yeah. And really what you're going to be doing is going to be most. In the Gemini account. We're going to have your IRA account. You're going to get an annual statement and the tax forms that we got to send to the irs. But you're not doing anything there, right? What you're, you're over in the Gemini account, which is tracking your daily values, which you can trade on like, like that, you know, and, or you can just look to see what are my holdings, you know. So now you want to use what's called the Active trader settings in Gemini. Gemini has kind of like a classic view, an active trader. There's fees that are decreased if you use Active Trader. So that's a note for anyone Working with us, we have special fees you can get using Active Trader Sketch interface when you're there versus the regular interface or the mobile app. So more detail when you're working with us. We have instructions on how you do that.

Can I make a tax comment or did you want to give a slide on taxes later?

Yeah, make a tax comic.

Here's what's interesting, as I was just at a dinner party over the weekend and someone said, well, if I buy crypto, when do I pay tax on it? When I convert it to another cryptocurrency or when I convert it to cash? And what happens if I go to buy a dinner or a car with my bitcoin? When do I pay taxes and the IRS regs or the whole other conversation. So. But what's beautiful is. Just got chills, man. I know I sound like a geek. I literally just got chills when I thought this. The beauty of doing this in your ira, it doesn't matter. There's no tax. You can convert the bitcoin to Ethereum, the Ethereum to smart coin. You can put it back into fiat cash, which would maybe be the US currency or the yen or the peso, whatever you started with. So the beauty is you're moving all this around in Gemini or your directed IR account, and. And there's no tax. There's no 1099, there's no tax return. It's just growing boom.

Yeah. That is one of the reasons a lot of our successful clients who got into crypto early, like the early adopters of this, they realized when they started making money, you know, and these were people that were buying, you know, bitcoin when it was hundreds of dollars or less, you know, but they start making a lot of money on. They're like, what the hell? I don't want to pay taxes on this. This is insane returns. So they started using their IRAs, and many of the smart ones use their Roth IRA because it's totally tax free. But even if you're using a traditional IRA or an HSA or any of these accounts as you're buying and selling, if you want to do that, and a lot of people are just buying and holding, they're like, I'm going to buy a Bitcoin or two and just hold, or I'm going to throw 10 grand at this and just see where it goes in the next 10 years, whatever. Some people want to be more active and trade and get in and out. Or maybe once a year, you kind of adjust things. But don't worry about all that tax reporting. And the cool thing about this is, see, your IRA owns this. So Gemini is not going to send any tax reporting to the irs. They know that we have an institutional relationship with them. They're not going to send stuff to the irs. When you're using an IRA llc, which is our other option, there are some downsides to that. One of which is a lot of these exchanges don't understand that the LLC is owned by an ira. So they send tax reporting to it like it's just a regular LLC that anyone else would have, that would have to have some tax reporting of the trades. So this is a nice, streamlined process that your IRA owns it. It's fast and easy for you to trade. You don't need an LLC set up. We're going to set the Gemini account for you. You got to log in and verify yourself to get access as a trader. And then there's no tax reporting. It's all linked to your ira.

Now, what was I last night? It was last night I was working late to about 1:30 in the morning, and of course, I'm flipping around trying to find a good movie. Of course, I ended up on the Accountant with, you know, Ben Affleck, because

how many times have you seen that movie?

What, is there a problem with that? Is there? I mean, it's only the best accountant movie in the history of mankind. I mean, all of us accountants dream

the worst because it's like, the only movie about accountants.

Well, not until my new movie comes out. Okay, now, anyway, I switched to it. I was on an infomercial for a minute, and that's how I feel right now. I'm the guy that's like, that's amazing, Matt. Now, does that come in a 12 ounce or an 8 ounce? So I got to be careful here. Okay?

So.

But what's funny, everybody, is this has been a whirlwind of a season. Every week, the SBA is kicking out more regulations on ppp. The government just passed another bailout. We've got tax season upon us. I mean, it has been nuts. So Matt and I have divided and conquered. And so, genuinely, people, I'm asking these questions, too, because I'm like, okay, what do I do next? Because I'm like, I'm doing the same thing. Oh, oh, and my producer brought this over for those that are on YouTube. This was the promo for the Accountant that got rejected before I got, you know, the real movie came out. So if you haven't seen that, it's the poop. So on YouTube. Some of you got maybe a kick out of that. Mike, My family for Christmas took the

movie mug in there, if you couldn't tell. Yeah, they took the movie. It was close. It was a close call. Very lookalikes, you know.

Yeah, yeah. So my family got me the movie poster, the accountant, and replaced my face with Ben Affleck's. And that was under the Christmas tree. So I was happy. Okay, now, so on this, Matt, I guess you're going to come to fees and some other things. So you're just going to.

I'm going to shut up right now.

Okay.

Okay, let's hit these. That's what I want to do too. God, we're just like, you know, just in rhythm today.

Shake and bake. Shake and bake.

Yeah, we're like. We're like the Dynamic Duo, you know, Wonder trimming. We once had someone tell us on our podcast that they remind us of a dynamic duo. And they said like Bert and Ernie. I was like, oh, okay. That wasn't the one I was thinking of when you said dynamic duo.

Yeah, because when we get into this

sweaters, maybe we were wearing sweaters more.

Yeah, because I'm Batman and Matt's Robin. That's really.

Okay, let's go to the screen here and let me show another image here.

Okay.

All right, so here we got the screen here for those on YouTube. I'm going to explain it here, but here's how the fees work with the crypto IRAs.

Okay?

We have a 295 annual account, fiat directed IRA. There's no account establishment fee of 50 bucks or anything that we have for other accounts, it's just 295. Now, where there's a $50 fee when we send money from your Directed IRA account, your crypto IRA over to your Gemini trading account. Okay? Now maybe you only do it once you have the 50 bucks, but if you're sending contributions in every year and you want us to send over that money, there's a $50 fee because we actually do have to wire it. So the funds are available over in your Gemini trading account. Alright? So now your money's over at Gemini and you trade. Now there's two trade fees you got to know about one, our trade fee of 1%. Okay? So if you buy 10,000 in crypto, we're going to charge you 100 bucks, okay? That's. We're going to charge your credit card on file at Directed IRA. Now, Gemini has a trade fee of 0.25, 2.35%. So if you buy again, 10,000 in crypto, Gemini is going to charge you 25 bucks or 35 bucks. It's a range depending on whether you're called, what's an taker or a maker in the market, whether you get the 25 or 35. So now that's. You have to use the active trader interface to get that fee schedule when you're at Gemini and then. And when you're with us, we give you the details on how to make sure you're doing that. So you're getting the best fee at Gemini, and that's it. If you want to store your crypto on the Gemini exchange, there's no fee. Your crypto is there at Gemini. You know, they have insurance and.

Which is your wallet?

Yeah, which is your wallet. You'll have your own wallet there. But you can't send money off. Okay, you can trade, but you don't have authority to go send that money over to Tesla to go buy a new Tesla with your Bitcoin. Okay? This is your ira. We've locked it down, so you can only trade. So, so, but if you want to start taking money, what you would do is you would convert your crypto back to fiat currency, let's say US Dollars, and then you send the money from Gemini and there's no fee for this back to your directed IRA account. We have a process for that. And then we'd send you a distribution. Obviously, if you're 59 and a half, that's when you'll start doing this. These retirement accounts are for the long term, right? We're building this wealth for the long haul.

Okay. On the fees, I want to ask that $295 setup fee and the $50 fee to transfer, I can pay that with my personal or business credit card.

Right? That's what we want. So we're gonna, in fact, we require you to use a credit card for these account fees because we don't want to go into your crypto and suck out your crypto, you know, which we will do if fees aren't paid. I mean, we will. We'll have to go access your crypto, but we're just going to charge your credit card on file and you can pay your account fees personally. There's an exception for that in the rules. You can personally pay your retirement account fees and all these transaction fees, you know, that we will have. Now, the Gemini fee, though, is going to come out of your account at Gemini. Gemini is going to take that out at the time you make the trade.

But the 1%. So the three fees that would come out of your credit card would be the Setup fee of 295, $50 to move my chunk of money to my Gemini Trade account. And then if every time I've made a buy or a sell, I would have a 1% fee charged to my debit card on file. So that way I'm not depleting my crypto. I really like that point that I can just snowball that. Just build it, build it, build it.

Yeah, yeah. We don't want to get into that. Those retirement plan dollars. We want to keep those as, like, sacred funds. Let us hit the credit card. And one other thing to keep in mind are that 1% fee is very competitive. I just saw. We just. We've talked so many clients that are paying 10%, 8% equity trust is 5%. One of the main players. The only ones we've seen even close to us are one and a half percent. And good luck talking to anyone on the phone over at those places. Okay. All right. These are like. They have, like, help desks and stuff. And it's like you do it all online. We don't talk to you.

You mean like Facebook, like.

Yeah, yeah.

Where's the Facebook hotline? I'm still waiting for that. Yeah.

It's like trying to get ahold of someone at the App Store on your Apple. So. So. But that's. That's the fee schedule. And again, this is option one. This is. I. I think this is the most common option people should use whether you want to buy. Let's say you just want to throw in five or ten grand at this. You want to do 100 or even more, possibly. This is a very competitive structure. Easy way to keep it streamlined. Make sure it's clear with the IRS that your IRA owns this trading account. So you don't get any tax reporting mistakes with the IRA llc. And it puts you in control. Like I said, there's other competitors out there. You'll see that may let you buy crypto with an IRA, but you can't do it 24 7, 365. Right. You're making the instructions to them on their websites and stuff. Are they trading immediately, or wouldn't you rather be on Gemini pushing the button to trade it yourself and seeing the trades happen? Now, this model.

Okay, so before we go to option two, I. Let me clarify something to you, because if you're. Some of you may be thinking, big picture is this is not to buy and sell Tesla stock or GameStop stock or AMC that's a different type of trading account which we have for IRAs here at Directed IRA, but it would not be the crypto IRA. Am I correct, Matt? You'd set up the crypto IRA just for crypto, then you'd use your other IRA can have a trading aspect, but that's a separate topic.

Yeah, so we have our regular self directed IRA accounts, which is actually. This is a great pivot. You know, if you're like, you know what, I don't want to just do this. I maybe want to do some real estate. I want to do some notes and I want to do some crypto. Okay, do an ira. All right, we got that structure, too. This is just our regular self directed IRA, which is $50 setup fee. 295. Now, you'd have to set up an LLC. If you look at this diagram here. Let's just share this screen here. You know, the IRA LLC there is going to cost you 800 bucks plus the state filing fee to set up. But you can do multiple things. In this example here, we show a wallet or exchange. It could be with Coinbase, or you could even again do it with Gemini or, or Kraken or Itbit or any of these other places. And so that's the second alternative structure that if you want to do multiple things with the IRA with the same account, you may want to use an IRA llc.

Okay, now, I like this distinction, if I may say it this way. Some of you are very familiar with SmartCoin or Kraken, and you're like, I want to use the platform I'm used to. That's where my wallet is and I want to use that. I'm in no big hurry and I'd like the flexibility to put money in some other places as I convert my crypto back to dollars. Then I would just say set up a regular IRA account over here like a typical Roth. A typical tradition. Do not choose the cryptocurrency ira. You're just going to choose a regular ira. Then they're going to send you over to the law firm. You'll get a real consultation with a real lawyer via Zoom, and they're going to build a diagram for you. Look at your big picture of everything. Our lawy do not operate in a tunnel. They want to look at. Okay, why are you doing this? What's the big picture? Do you have your family trust? Who's the beneficiary of your ira? Are you fully organized? And we might see things where we see some problem areas and give you some Items to do this year as well. Then you form your IRA llc. On that consultation, the law firm sends the LLC back to directed ira, funded it. You fund it. Then from that ira. Now you open a Coinbase account in

the name of the. Well, you'll have one step in the middle there. The LLC will have a business checking account, right? Okay, so you'll open up a checking account in the llc, and you're manager of the llc, so you have authority on that account. And that checking account is what you'll link to a wallet or an exchange, as Mark's mentioning here, that could be like Kraken or Coinbase. Because some people might be like, matt, I want to trade, you know, polkadot, or I want to trade dogecoin. Okay? These are some popular ones you might hear out there. They're not on Gemini. Okay, do the irl, see, then. And you could then go to an exchange and use a wallet that. Where you can buy and hold that type of crypto. Another reason people may want to use the ira, llc. So let's say you. You may want to use. If you want to do multiple types of assets, like, you want to do real estate and notes all in the same Iraq, or you want to buy crypto that's not on the exchange, not at Gemini. Or you're like, matt, I want to hold the private keys. See, with crypto, what you actually have that you use to exchange the crypto are what are called the private keys. And the private keys, some people want to hold those. They're worried. Like back here on this example here with Gemini, if we share my screen now, when you're in this structure, Gemini has the private keys on their exchange. Now you can go into what's called cold storage at Gemini, where they take it off their exchange and they put it on servers and have a more secure system where it's totally not online. But you're paying 1% annually to have that cold storage. Now, that's an option when you're in this structure. Some people are like, matt, I just want to put it on, like, a thumb drive, like a tracer, or some of these other options out there. I don't want it anywhere. I want it totally in my control. You're gonna need to do an IRA llc, okay? And that way you can get more control of your private keys. Because some people are out there and they're like, you know, no keys, no crypto. You know, they're really freaked out of, like, you know, some of these exchanges being hacked and such. But what I'LL say with Gemini is the reason we use them is they're a licensed trust company, they have insurance, they're really on the front lines in terms of technology and stuff. And so but there's of course, risks and you're choosing to use them when you go into this structure. So if you're worried about the private keys, you're not satisfied with, with how Gemini does it, their exchange storage or their cold storage, you may want to use the IR llc.

Okay, I boy, you opened up a lot of different divergent roads we could go down. What I think is a nice moment to just sit back and look big picture here too is what is your long term goal with this whole cryptocurrency topic? And you make sure that you try to choose the right method from the beginning for your investment portal. And I know that sounds like some of you are like, I want to just buy right now. You know what, Crypto will be here next week. It's okay. And I know some of you, there's some announcements or you need to move quickly. You could open two IRA accounts. You could have one through Gemini where you're making a trade within 24, 48 hours. As soon as the money gets here, boom, you're in business. Or you may say, you know what, I do want a little longer term llc and this is where I have fun with it and say, why don't we pool some of our IRA money together? So I might say, I'm going to take my kids Roth Ira, my spouse's Roth Ira, my kids college savings Ira, and my old 401k from a job 10 years ago. You can form an LLC with multiple retirement accounts and then go open a Coinbase account and that, that. But yet, in order to pool your money, you've got to use the LLC concept. But it's a great opportunity to get your family members on a phone call with an attorney and go, hey, explain how we build wealth as a family. Why are we doing this? And I'm a parent of teenagers and young adults. They're not always listening to dad, you know, and so when you get them on a phone call with a real attorney, this could be their first experience talking to a lawyer in an engaged process. And so I think it's a great time for many of you to share this strategy. Maybe you don't give them this whole podcast because they're not going to listen. But I was just sitting down Sunday night with a family down my street. Their son, who's 16 years old, was like, oh, I'M gonna buy crypto. And mom and dad were like, well, I own a little. And they. And the kids looked at the parents. You do like my parents.

Cool.

You know, and so I think this is a great chance to really make it a family affair too. So yeah, look, big picture. I like that.

And you can do counts for your kids. One of the things we love talking about doing a Roth IRA for your kids. If you have a small business, you know, pay them in the business. Or maybe your kids have jobs in college or in high school that they have income but they expend every check because that's what they work for. And that's great. But you can use that income to throw it into a Roth ira. Maybe it's five grand a year that they're making in your business or on their own that you could throw into a Roth IRA for them to do some crypto in any of these options just. And just have. They could do their own trading account or you could pull it like Mark said in the multi member LLC too. So love that. And I think that's the thing with these accounts is it's a 295 annual fee on just the regular crypto. Low maintenance. You don't pay the 1% anymore. You just buy it and sit on it. And if this thing, you know, if you pick the right crypto or yeah, who knows? You know, this could be a great little thing to just throw a little bit of money at it, be measured. Don't throw all your money into this obviously, of course. And get financial advice if you need it. But we're just saying we got options here on how to do it. So

on the, on the security topic, let's go back to that again because I'm a Mr. Robot fan. So if some of you have ever been hacked, I've actually told Matt we've got a really. We've got a pretty good cybersecurity plan here in our different firms. And personally, since you're out there on a podcast, you want to make sure you're not a target for those sorts of things. But you can always improve in different areas of life. And, and I'd recommend to all of you to take this chance to, to look at your security process. If you say, I am a prepper, I've got my bomb shelter in the basement, I want to have my keys in a safe. And Matt, one of these days my bucket list is I want a safe where I put my handprint on it. Just go, yeah, it goes and it opens up that'd be sweet.

Yeah.

But anyway, if some of you are in that ball game where you're really heavy in security, which is cool, you're not going to use the Gemini crypto ira, go get the LLC done, where you can have control of the keys, really control how you're holding your retirement account Crypto. But for. And I'd say that's a minority. Not everybody's wanting to do that. Yeah, I think I like what Matt said, that the far, far majority of everybody's like, hey, I want to start trading right away. I'm not throwing my life savings in that. Which I would recommend you not.

And.

And set up the Gemini crypto ira. I just think it's awesome what Matt and the team has done over there. They've worked so hard to make this easy.

Yep. Yeah. And we'll keep improving it and making it better, but. All right, well, I want to hit one other thing, option that people have too, on how to get buy at least bitcoin with an ira.

Okay. So option one was Gemini account. Option two was ira, llc. I'm dying.

Yeah, it's option the crypto ira. Crypto IRA account with the Gemini trading account linked to it. Option two is the self directed IRA with an IRA, LLC. Option three is these ETFs. People talk about these ETFs. All right, did you just. Was that Rockstar?

We're doing some photo shoots over here, so if you're on YouTube watching this, I'm posing with my rock star. And just the right manner for our camera guy, because Rockstar, we're this close, dude. We're gonna have three rock stars for the rest of our life. Yeah, it's like Kramer and Seinfeld. You traded what?

Yeah, yeah. Rockstar spokespersons are like actual rock stars, like motocross racers, NASCAR racers, you know, and the tax lawyer accountant.

Mark, I carry a.50 cal in the trunk and a case of Rockstars. Okay.

All right, keep going. Option three, that could be an untapped demographic for them, actually.

Yeah.

Okay. All right, so these ETFs are out there, and you can buy these with an ira. In fact, you just use directed IRA with us with the brokerage option added to it, and you can buy some of these ETFs. Now, I want to give a couple cautionary points on why you may not want to buy this. First of all, it's only bitcoin so far that is available in these ETFs. The one that's been around for the longest. Now it's only been a year or so is is grayscale. Here's the problem with grayscale. When you buy into their etf, what they're doing is they're just going and buying Bitcoin, which is great. That's what you want, right? That stock just owns Bitcoin. But they have fees and operating costs and they have a 2% management fee. So if you put 100 grand in, you're really only getting 98,000 and that's a 2% management fee every year. So if you look at well I have a 1% fee to buy, but then there's only a 295 account fee. What am I better off doing? If you're going to buy anything significant, you're probably not going to want to buy into the grayscale Bitcoin trust because it's higher to just own in that fashion rather than to do it through your own Gemini trading account. Okay, so that's one option is that etf. And again, you could do it here at Directed ira. We don't care. Pick whatever option works for you. It doesn't. You know, we're frankly, we have all options covered. The other one out there that some people are like, well, what about Osprey? Now Motley fool did a pretty good article on this. If you go look up Grayscale vs Osprey on comparing these and some of the things people need to be aware of on these ETFs is Osprey will advertise. We have a 0.49%, half a percent management fee essentially. And that's way better than grayscale at 2%. But what does Osprey not. What do they have to disclose to you? If you read the fine print, and this is what Motley fool outlines, their net asset value is only like 70% of the value of. If you like broke it down and sold all the shares of Osprey, you'd only get a 70% and they sold all their Bitcoin that everyone that has bought in you get like 770 cents on the dollar back in, in dollars from what the bitcoin is at. They're not buying 100% bitcoin with what goes in. And so there's this net asset value inconsistency at Osprey that they've disclosed as part of how they're going to operate it. And that's really a downside into well, am I really buying into a fund that's just buying Bitcoin? Yes, but it's not buying all bitcoin there's something else going on there where the net asset value is off. And so just, just look into that. And I think the Motley fool article, if you just search for that Grayscale vs. Osprey Motley fool, there's a good article that kind of gets into a little more detail on that. So now these are, these ETFs are not on the NASDAQ or the New York Stock Exchange. These are OTC over the counter market shares that are a little more tricky to get. Not every broker dealer with IRAs allows them for them, but we do at Directed IRA. If you just use a regular self directed IRA with the brokerage option, you could get these ETFs. So there it is. That's the three options, the Bitcoin ETFs that are out there. And I'm sure there'll be more and more added over the years. The IRA llc, if you want to hold the private keys or you want to buy crypto not on the Gemini Exchange, or you just otherwise want more control or flexibility to do other assets out of the llc. And then of course the crypto ira, which I think is probably the best fit for most people. Where we have an ira, that's a specific crypto ira. Here it's linked to and funds your Gemini trading account. Your IRA owns it. You're in control as the trader on the Gemini trading account to do whatever you want. 365247 to buy and sell crypto.

Okay, now I want, if I can make one, I love it. Matt, you've done a great job and so much hard work done over at Directed ira. Many of you don't realize the nights and hours and weekends that the team spent over there. Really being at the forefront of custodians around the country with the lowest prices, the most user friendly website and you can always call and talk to someone, which is crazy. So I hope some of you look at that. Now I want to just give one big picture here too. As I was just searching here while we were finishing up the show, just to confirm again, Robinhood. Let's talk about Robinhood. It is probably the 800 pound gorilla out there for young people and those that are just starting to begin trading. TD Ameritrade said, what happened? I thought we were the online source to trade and Robinhood just boom, you know, just went past him. But here's the thing. Robinhood's great, it's simple. But you cannot have an IRA or Roth IRA at Robinhood. So if you're gonna buy crypto again in your personal name. You might find that your Robinhood account is a great little place to do it. They don't have all the cryptocurrencies, but they have three or four of the biggies. That's great. And then you can switch over and buy GameStop one week and buy Ethereum the next week. That if that's what you want to do. But this is a bigger bucket we're talking about for the long term. We want all of our clients buying real estate in their own name and in their retirement account. We bought them doing investing in their own name and in their retirement account. We're not saying it's one or the other, it's both. And so be thinking about a Roth account. If some of you don't know what a Roth's about and how quickly they can grow and they're tax free. Just YouTube Kohler Roth, Kohler Roth IRA. I've got several videos that have almost a million views. How to build a million dollar Roth IRA and this bitcoin plays right into it. Or I shouldn't say bitcoin cryptocurrency plays right into it. So do a little research on that if you're new to this Roth IRA IRA concept as well and how powerful they really are. But just realize that some of these big institutions like Robinhood have a lot of money to spend on marketing and you think it's a one stop shop. It's really not. You've got to dig a little deeper.

So yeah, awesome. Well you can go to directed ira.com you know, hate to be sales here. This is, you know, today's podcast is brought to you by Directed ira. This is the Directed IRA podcast. So it's okay I guess

go there.

We have a page on cryptocurrency and if you go to the open account apps, you'll see the crypto apps there on the page. Just look for the ones called Crypto IRA or Crypto Roth IRA or Crypto hsa Crypto Solo K whatever you want to, you know, do in terms of cryptocurrency for your account types. And again as Mark said too, you can set up appointments, you can talk to actual people here at the office on getting these accounts going. And the last thing as I'll say, which is just the reminder on the disclaimer is, you know, we, we're all about self directing and you charting your own course and finding your way. I think for me it's just as I invest my own retirement account and self direct. Like I'm doing crypto, I'm doing real estate, I'm doing private lending. I'm doing a lot of these things is I like having that control and being the captain of my own ship and also having the satisfaction when it works. Right. And being active and involved in my retirement. You know, we like to say take control of your retirement. So that's what we want you to do here. We don't give investment advice or tell you what to do. We're just like, here's how to do it if you want to do it. And these types of assets, real estate, crypto, private companies, private lending, precious metals, you know, back to the, the old school, you know, the actual gold, you know, those are things you can do with an ira and we're here to help if you want to use and get those assets in your retirement account.

Love it. Well, thanks again, Matt, and thank you everybody. Please can subscribe, give us a five star rating if you feel so inclined and please share this podcast with others that you know that would just benefit from this information. And we'll see you next week on another episode of the directed IRA podcast.