The Potential Benefits of Investing in Private Companies with a Forge Trust Self-Directed IRA

In today’s ever-evolving investment landscape, diversification is more than just a buzzword—it's a well-known strategy for investment stability and growth. For savvy investors looking to go beyond traditional market opportunities and move into high-potential private company investments, a self-directed IRA (SDIRA) from Forge Trust offers a compelling opportunity.

Private company investments, long reserved for institutional players and the ultra-wealthy, are increasingly accessible through self-directed retirement accounts. When managed correctly, using retirement funds to invest in private companies can be a game-changer—especially when paired with the know-how and flexibility offered by Forge Trust.

The following explores how Forge Trust SDIRAs can unlock new possibilities for investment portfolios.

Why Consider Private Company Investments in a Self-Directed IRA?

Private companies can often represent untapped potential. From promising startups to bleeding edge unicorn, pre-IPO companies, investing in these entities allows individuals to capture earlier-stage growth and value creation. However, many investors overlook the opportunity to use retirement dollars—often their largest pool of capital—to participate in these investments.

That’s where Forge Trust comes in. With a self-directed IRA, you can allocate retirement funds toward non-traditional investments, offering both portfolio diversification and significant tax advantages.

Tax Advantages That Can Work in Your Favor

One of the strongest arguments for using a self-directed IRA to invest in private companies is the potential for tax-deferred or even tax-free growth. Here's how it works:

• Tax-deferred growth: Earnings from your private company investments grow tax-deferred within a traditional IRA, meaning taxes on gains, dividends, or interest are deferred until you start taking distributions—allowing your capital to compound faster over time.
• Tax deductions: Contributions to a traditional IRA may reduce your taxable income for the year, offering an immediate benefit come tax season. [Be sure to check current IRA contribution limits and consult with a tax professional, as needed.]
• No capital gains tax: Unlike personal investment accounts, there are no capital gains taxes on the growth of your assets inside an IRA, which could potentially save an investor thousands of dollars.
• Streamlined recordkeeping: Forge Trust handles all essential account documentation and IRS reporting, which can simplify what might otherwise be a complex process.

[Refer to IRS Publication 590-A for additional information regarding the taxation of IRAs.]

More Strategic Control Over Your Financial Future

Forge Trust SDIRAs offer investors the flexibility to align their retirement strategies with personal private market convictions and goals.

• You’re in charge: Unlike traditional IRAs that can limit your investments to publicly-traded stocks, bonds and mutual funds, a Forge Trust SDIRA lets you choose from a broad range of private company offerings.
• Long-term focus: Private company investments typically take time to mature. Fortunately, retirement accounts are structured for long-term growth, making them a potential match for these types of holdings.
• Liquidity need alignment: While private company investments may not feature the same day-to-day liquidity of public market investments, retirement funds are not typically needed until later in life. As such, the longer-term horizon of private market investments aligns well with SDIRAs.

Potential for Diversification and Long-Term Growth

Using a self-directed IRA to invest in private companies not only offers the potential for significant returns, but it also introduces a new level of customization and strategy for your retirement planning.

By combining:

• Potential tax-advantaged growth,
• Direct control over asset allocation and
• The ability to tap into private markets,

Forge Trust helps investors maximize their potential retirement capital and seize opportunities that were once out of reach.

[Note: Investors should be aware that investing in the private markets often comes with additional risks including potential increased risk, including loss of your investment, increased fees, and less liquidity. Individuals are encouraged to seek independent professional advice.]

Ready To Take the Next Step?

If you’re interested in unlocking the potential of your retirement dollars and investing in private companies through a Forge Trust self-directed IRA, getting started is easy.

Create your Forge Trust account today and start building a smarter, more diversified retirement future.