James A. Jones at Crowdfunding East Conference (www.CrowdfundingEast.com)

2. The Key Role of Self-Directed IRA’s in Crowd
funding:
No. 1 Issue for Portals – Attracting Investors
No. 1 Issue for Investors – Return with Taxefficiency
No. 1 Issue for America – Retirement Fiscal Cliff

3. What is a Self-Directed IRA?
• A Self-Directed IRA or SDIRA is an IRA that is
designed to let the IRA holder invest in alternative
assets other than stocks, bonds and mutual funds.
They are like any IRA in regards to IRS Code 590 in
regard to contributions, distributions, rollovers and
transfers
• Self-Directed IRA’s are available in Traditional, Roth,
SEP’s, I-401K’s, HSA’s, and Coverdell Educational
Accounts

4. Crowd funding Categories
• Donor or cause- charitable or religious based - Not
Applicable for Self-Directed IRA
• Incentive or Pre-purchase – Pebble watch –
Applicable for Self-Directed IRA
Not
• Peer-2-Peer Lending – Very applicable for SelfDirected IRA
• Accredited Investor – Reg D – Very applicable for
Self-Directed IRA Investor

5. Attract Investors to Portals
Maximize the attractiveness of your offering
• # 1 challenge is reaching investors beyond your
own crowd
• Offer a value differentiation among peers and
competitors
• Be proactive in addressing the goals and
objectives of the investor; offer a compelling story
and a compelling tax incentive
• Be proactive in addressing the significant tax
increases for investors

6. Offering Investors Return with Tax-efficiency
• Return – double digit returns – Lendit2013 –
Consumer, Small business, Student sectors
• Diversification – “Mainstreaming Alternatives”
alternatives returned 14.9% v. S&P 1.9% from
2001-2011-alternatives growing to 27%
allocation of portfolios by 2014-2015
• Tax-efficiency – Offer investors tax free
(ROTH) or tax-deferred returns using SelfDirected IRA’s

7. SDIRA’s to Attract Investors-Consider offering a Self-Directed IRA
What is the process to offer SDIRA’s?
• Simply create a link to your site or portal
• An on-line application generates an account
number in 1-2 hours
• Complete an on-line transfer or direct rollover
to fund the new SDIRA
• Complete an on-line “Buy Direction Letter” to
direct the investment to the offering via wire

8. Why isn’t every portal offering Self-Directed
IRA’s?
• Awareness – Most portals, investors and
advisors have never heard of SDIRA’s
• Brokerage firms don’t/can’t offer them, not in
their interest to lose AUM
• The process can be very cumbersome if the
Provider does not offer a link for an on-line
application
• Many providers take 3-5 days to generate an
account number
• Transfers can take weeks if not done right
• The right Provider can make or break a
campaign

9. The Retirement Fiscal Cliff
• 78MM baby boomers will bankrupt Social Security,
Medicare/aid between 2022-2032
• Retirement portfolios and home values are still down
30-40%
• Paltry investments returns in traditional assets of
1.9% from 2001-2011
• Where you put new retirement funds, and how will
you get there from here? (my recent experience)

10. SDIRA’s to Rebuild America
Crowd funding can do more than create jobs – it can fix
the coming retirement crisis
• The average IRA is a 50 year old with $100,000,
invested in P2P Crowd funding could be worth an app.
$1.4 MM at 70 1/2
• Health Savings Accounts contributions could be worth
an app. $600,000 over 30 years
• A Coverdell Education Account could be worth an app.
$180,000 over 20 years

11. The Key Role of Self-Directed IRA’s in
Crowdfunding and the JOBS ACT
James A Jones
jjones@kingdomtrustco.com
978-500-5791