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Maximizing Your Self-Directed IRA: Strategies for Diversification

Picture of Thomas Young Thomas Young : March 27 2025

Self-Directed IRA Alternative Investing

When it comes to building a strong retirement portfolio, diversification may be key. But for many investors, traditional IRAs limit investment options to publicly traded stocks, bonds, and mutual funds. That’s where a Self-Directed IRA from Rocket Dollar (SDIRA) comes in—offering the flexibility to diversify into alternative assets and take greater control of your future.

In this post, we’ll break down why diversification might matter, what you can invest in with a self-directed IRA, and how you might think about allocating your retirement dollars.

Why Diversification Matters in Retirement Investing

The primary goal of diversification can be to reduce risk. By spreading your investments across different asset classes, sectors, and geographies, you may help protect your portfolio from volatility and market downturns. Traditional portfolios often lean heavily on equities and fixed income—assets that can become highly correlated during economic stress.

With a self-directed IRA, you’re no longer limited to Wall Street. You can build a portfolio that includes both traditional and alternative investments, potentially opening up new avenues for growth and income.

What You Can Invest in With a Self-Directed IRA

One of the biggest advantages of a self-directed IRA may be the expanded investment universe. At Rocket Dollar, our clients commonly invest in:

Real estate: Residential rentals, commercial properties, raw land, and more
Private equity: Early-stage startups, growth-stage companies, or private funds
Venture capital: Access opportunities normally reserved for institutions
Precious metals: Gold and silver, which may offer inflation protection and stability
Cryptocurrency: Digital assets like Bitcoin and Ethereum
Private credit: Loans, notes, or real estate-backed debt
Crowdfunding platforms: Fractional investments across a wide array of alternative asset classes

These investments can offer the potential for higher returns and lower correlation to the public markets—but they may also require thoughtful due diligence and a long-term mindset.

Strategies to Diversify Your Self-Directed IRA

Here are a few ways you might consider using your self-directed IRA:

1. Blend Traditional and Alternative Assets

Just because you’ve opened a self-directed IRA doesn’t mean you need to abandon traditional investments. Many Rocket Dollar customers maintain a core allocation to ETFs or index funds and may choose to layer in alternatives for potential growth or income.

2. Choose Non-Correlated Assets

When selecting alternative investments, some investors look for assets that don’t move in lockstep with the stock market. For example, real estate or private credit might offer more stable returns even when public markets are down.

3. Diversify Across Time Horizons

A mix of long-term, illiquid investments (like private equity or real estate) with shorter-term opportunities (like private lending or digital assets) can potentially help balance liquidity needs with return expectations.

4. Stay Within IRS Guidelines

Remember, not everything is fair game. The IRS prohibits investments in collectibles, life insurance, and certain “self-dealing” transactions. If you’re unsure what qualifies, , our support team can provide general information or educational material such as links to the IRS website to help you stay informed.

Get Started With Diversification Today

At Rocket Dollar, we provide a platform that can make it easier to open and manage a self-directed IRA so you can explore investments beyond Wall Street and build a retirement portfolio that reflects your individual strategy and goals.

Whether you’re a seasoned investor or just exploring alternative assets for the first time, our platform offers the tools and flexibility to take full control of your retirement.