“Self-directed retirement plans allow for many types of alternative investments such as venture capital,” explained Raskulinecz. “
Roseland, NJ (PRWEB) August 16, 2013
On July 10, 2013, the Securities and Exchange Commission (SEC) lifted its decades-long ban on “general solicitation”—the public advertising by startup companies that are seeking seed money. Jaime Raskulinecz, CEO of Next Generation Trust Services, LLC, said that this change will make it easier for private companies to raise funds and opens the door to a wider audience of accredited investors who wish to make equity investments, including through their self-directed retirement plans. Next Generation Trust Services is an administrator of self-directed IRAs.
With the enactment of this change, accredited investors will have greater access to information about investment opportunities in private companies, either as equity or other investments. It’s part of the JOBS (Jumpstart Our Business Startups) Act which was signed by President Obama in April 2012; full implementation of the bill’s regulations have been pending SEC votes and rulings, such as the one on general solicitation.
“Self-directed retirement plans allow for many types of alternative investments such as venture capital,” explained Raskulinecz. “This forthcoming change will further enhance our clients’ investment options since they will be able to find out more readily about startups they can invest in. We are seeing several portals being formed that will provide access to some of these offerings to accredited investors.”
With self-directed retirement plans, account holders make their own investment decisions and may invest in nontraditional and traditional assets. Next Generation provides full transaction support and account administration as well as education about self-direction.
Prior to this change by the SEC, it was illegal for private companies to advertise or discuss publicly that they were raising money in exchange for equity. The new law will go into effect in mid-September. Full details on this SEC vote can be found at on the SEC website.
To qualify as an accredited investor an individual must have a net worth (excluding primary residence) of $1 million and/or at least $200,000 in net income for the prior two years.
Increased Interest in Crowdfunding Information
Raskulinecz said that more website visitors have been downloading Next Generation’s white paper on crowdfunding since the SEC’s vote in July. The JOBS Act opened the door to crowdfunding, a measure aimed at increasing access to capital for startups; however the SEC has not yet developed the final rules on that strategy.
“Right now, unaccredited investors may not participate in investment opportunities to help companies or projects fundraise for private equity,” said Raskulinecz. “When the new crowdfunding rule goes into effect, it will allow for the creation of approved fundraising portals that will enable unaccredited investors to participate in this type of investment, which can sometimes be quite lucrative.” She added that many account holders of self-directed retirement plans make angel investments in startups as well as unsecured loans through their self-directed IRAs.
For more information about self-directed retirement plans contact Next Generation Trust Services at Info[at]NextGenerationTrust[dot]com or (888) 857-8058, or visit www[dot]NextGenerationTrust[dot]com
About Next Generation Trust
Next Generation Trust Services (NGTS), headquartered in Roseland, New Jersey, is a professional third-party administrator of self-directed retirement plans. NGTS provides education, administrative support, and account maintenance to individuals interested in self-directing their retirement portfolios with a wide variety of investments that are not typically found in an IRA, such as real estate, precious metals, notes and mortgages, private placements, accounts receivables, limited partnerships, hedge funds, and much more. Next Generation Trust Services serves clients globally via its website, http://www.NextGenerationTrust.com. For more information on self-directing a retirement plan, call 973-533-1880, 888-857-8058 (toll free), or e-mail Info[at]NextGenerationTrust[dot]com.