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7 Features to Look for in Your Alternative Investment Platform

7 Features to Look for in Your Alternative Investment Platform

Diversifying your investment portfolio with alternative investments broadens your future potential for attractive returns beyond stocks and bonds. However, the key to making a seamless transition into the world of non-traditional investments is to find the best alternative investment platform.

Unfortunately, with so many management platform options available, finding the perfect platform for your needs specifically can be difficult. Below is a look at some features to consider and look for to help you decipher which platform is best for you.

1. An Investment Opportunity That Works for You, Now and Later

Consider what type of alternative investment assets are most appealing to you. There are a number of types of alternative investments, and some may be more appealing to you than others. For example, maybe you are most interested in cryptocurrency or real estate.

It is common for a management platform to specialize in one specific type of alternative investment. While these can be suitable for some, flexibility can be valuable. 

So, it is a good idea to look at platforms that give you the opportunity to invest in multiple types of assets. For example, at Rocket Dollar, you can invest in real estate, cryptocurrency, startups, or even Bring Your Own Deal (BYOD). BYOD allows you to allocate funds to whatever investment option you want.

2. Transparent Pricing Models in Line with Industry Standards

Pricing models with an alternative investment platform are not always clear-cut, but they can be transparent with the right platform. Examine pricing models before committing. Look at what the platform charges for setup, monthly maintenance, and bank fees.

It can be really disheartening to rollover funds from an existing 401k or traditional investment and discover the platform has more charges than expected. Likewise, it can be frustrating to see heightened maintenance fees because your account grows. These are things to look for before committing to a certain platform.

3. Customer Support That Are Around When You Need Them

Customer support means everything when it comes to managing alternative investments, especially if you're new to the process. A good support network is valuable as you get familiar with the sometimes intimidating territory. Further, support is critical as you learn the ropes and have questions about your investments later on.

Certain aspects of support should be clear by looking at the platform. For example, you should have access to support on your terms and via multiple routes of communication. It should include email, chat, and phone.

Check out what other users have to say when it comes to investor support. Look at user reviews and complaints to get first-hand insight.

4. Suitable Funding Options

How will you fund your alternative investment accounts? Some investors will be looking to only use private funds to purchase alternative assets. Therefore, things like wire transfer options to fund the account will be important. On the other hand, if you intend to rollover funds from an existing 401k or retirement account, this is a little more complicated.

The best alternative investment platform offers flexible funding options. They can just as easily accept private funds as they can walk you through rolling over funds from an existing employee 401k account or otherwise.

5. Easy to Navigate and Use

Easy navigation of an alternative investment platform is important no matter the type of investment. There are certain actions you will need to take periodically. If the platform is hard to navigate, it can mean monitoring your portfolio falls by the wayside because it's too much trouble. A few features to look for include:

  • Straightforward investment tracking dashboards
  • Easy-to-find personal documents and reports for download
  • Mobile-friendly apps for on-the-go accessibility

Before committing to a certain platform, examine the provider's website and check out what other users are saying. While investment advice can be found all over the internet, make sure the company seems knowledgeable and informative.

6. Liquidity for Your Investments

Liquidity refers to the ability to convert your alternative assets into cash and how easy that process is without having to wait. Depending on your personal investment goals and reasons for investing, you may need different levels of liquidity from your alternative investing.

And, all types of alternative investments can involve different levels of liquidity. Investing in a venture capital opportunity will provide a different amount of liquidity than a real estate investment.

If you follow the general recommendation of investing 10 to 20 percent of your full portfolio in alternative assets, this can be a substantial amount of money. You will want to know how quickly you could access those funds if needed.

For example, real estate investment through crowd-investment platforms can be a little more illiquid. That's because you are likely to buy shares of a property. Then let's say you decide a few years after investing that you want to withdraw the funds and take your money elsewhere. You may have to wait until the platform finds an investor for your shares. 

For this reason, some alternative investment platforms that specialize in real estate shares will have a strict policy on when funds can be withdrawn. Sometimes it can be five to seven years after the initial investment. Take note of the timeline for your investments.

7. Account Types That Fit Your Retirement Goals

Different alternative investment platforms can offer different types of accounts. Be sure the accounts offered are in line with your personal retirement goals. A few types of accounts that may be offered include:

  • Traditional IRAs (Individual Retirement Accounts)
  • Roth IRAs
  • SEP IRAs
  • Solo 401(k)

Some investment platforms will offer only one or two types of accounts. Also, the type of retirement account offered can have bearing on things like whether withdrawals are taxable, the type of management fees you pay, and more. Therefore, be sure to check out the specifics before you sign up with a certain platform.

Find an Alternative Investment Platform That Works with You

Ready to find an alternative investment platform with the flexibility, ease of use, and support you need? Consider working with Rocket Dollar and dive into different alternative investments to set up your retirement well. Ready to get started?

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