RIP-OFF ALERT: Alternative investment scams that involve self-directed IRAs are leaving senior citizens with no retirement money.
I’ve gotten several calls on the show about seniors being told by marketers and salespeople that traditional investing in stocks and mutual funds is a waste of time. The real money, they say, is being made by putting your money in gold and other precious metals and various forms of real estate investing.
But the Securities and Exchange Commission now warns such come-ons are part of a big-time scam. In short, people put money into these alternative investments and then the custodian, administrator or promoter runs off with all your IRA money — leaving you with no money for retirement.
The Wall Street Journal reports one promoter stole $1 million from senior citizens. Seniors face a unique challenge because CD rates are being held artificially low. That creates an opportunity for scamsters to step in with their pitches.
Know this: Nobody has a magic formula to take your IRA money that isn’t growing sufficiently and put it in some kind of magic commodity or real estate investment that will suddenly create great wealth for you. It is a scam, it is a rip-off. Be careful out there and be safe.