Rocket Dollar is a unique investment platform that allows users to self-manage their retirement accounts. In this Rocket Dollar Review we will see if setting up an account is even worth it.
Self-managed retirement accounts are more flexible than accounts with large banks, so they’re becoming prevalent among more advanced investors.
However, is Rocket Dollar a worthwhile option for the average trader? Our Rock Dollar review will pick this platform apart so you can decide if it’s a good option.
Rocket Dollar Reviews: The Basics
If you are investing, odds are you are putting funds into stocks and bonds. However, there are many other ways to put your money to work.
Unfortunately, IRA and 401(k) accounts are pretty limited and most only allow investments in stocks, bonds, and mutual funds.
These accounts don’t usually cover alternative investments like real estate and private equity. As a result, investors have to give up some tax advantages to invest in non-traditional assets.
That’s where Rocket Dollar comes in the picture. Rocket Dollar is designed for traders who want more control over their tax-advantaged retirement investments.
Users manage their own IRAs or 401(k)’s, so they have a lot more flexibility with their retirement investments. Self-managed retirement accounts can also be used to purchase alternative investments, like private equity, real estate, and more.
Rocket Dollar: Street Cred
Henry Yoshida, Thomas Young, and Rick Dude founded Rocket Dollar in 2018. The founders believed that investors should have more control over their investment options.
According to its website, Rocket Dollar wants to “make it safe, simple, and fast for people to take control of their retirement savings.”
Rocket Dollar is geared towards experienced investors who want to take a more active role in their retirement investments.
Users have full control over their accounts and what’s in it. It’s significantly less restrictive than typical retirement savings apps, many of which only offer a handful of cookie-cutter portfolio options.
Rocket Dollar offers two types of accounts. Both have subscription fees, but we’ll dive into that later. Each plan has lots of great benefits, including:
- No minimum deposits
- LLC for holding investments
- Investment management tools
- Online document storage
- And Email support
Rocket Dollar’s higher-tier plan also includes cash management options, like debit cards and check writing. Top-tier account holders also qualify for priority support and assistance with tax filing.
Rocket Dollar Review: Account Options
Rocket Dollar offers self-managed retirement accounts options, including 401(k)s and IRAs.
These accounts allow users to access traditional investments like stocks, bonds, and mutual funds. However, users can also utilize their tax-advantaged accounts to invest in alternative assets.
Rocket Dollar offers the following types of retirement accounts:
- Traditional IRA
- Roth IRA
- Rollover Roth IRA
- SEP IRA
- Solo 401(k)
You have 100% control over your Rocket Dollar portfolio, so you can invest in whichever assets you prefer.
However, there are no robo-investing options, so you have to manage your portfolio personally. It can be intimidating for beginners, but experienced investors will appreciate the added control.
How Does Rocket Dollar Investing Work?
Rocket Dollar offers its users “checkbook control.” This gives account holders complete control over their investments.
Users can buy assets with a debit card or check just like with regular bank accounts. However, you don’t technically own these funds. Rocket Dollar maintains legal ownership to prevent you from violating IRS regulations regarding the separation of investment and personal-use funds.
This distinction allows Rocket Dollar users to make tax-advantaged investments in a variety of assets.
Generally, it takes tons of paperwork and other special accommodations to purchase alternative assets through a retirement account. Most 401(k) and IRA accounts don’t allow alternative asset investing because the legal process is so complicated.
However, Rocket Dollar’s approach makes it easy to expand your investing horizons while maintaining tax advantages.
Rocket Dollar Review: Asset Classes
Here is a quick rundown of the kinds of investment classes you can choose from with Rocket Dollar.
You can trade gold, silver, palladium, and platinum through Rocket Dollar’s partner, the US. Gold Bureau.
Typically, holding precious metals is cumbersome because of the difficulties associated with storage and security.
However, Rocket Dollar allows you to easily purchase and store physical metals at the Texas Bullion Depository.
Most institutions won’t allow retirement accounts to purchase cryptocurrencies, so it’s hard to make tax-advantaged crypto investments.
However, Rocket Dollar users can buy crypto through the platform’s self-managed offerings. There’s only one catch: you have to set up a crypto wallet to hold your digital investments.
Real estate is one of the best-returning assets from a historical perspective. However, you can’t buy a property through a retirement account that’s under your own name.
If you decide to purchase real estate for your IRA, it has to be for investment purposes.
IRS regulations also prohibit you from residing in the property or personally manage repairs. It sounds like it’s more trouble than its worth, but the potential tax benefits are astounding.
Thankfully, Rocket Dollar offers a variety of services to help you navigate these challenges, so investing in IRA real estate is easy.
Companies typically undergo their fastest growth phase before they go public. In the past, most retail investors couldn’t partake in these exclusive deals.
However, Rocket Dollar allows you to buy shares of private companies with your retirement accounts. You can also use your retirement funds to make venture capital investments and issue expansion loans.
You can also buy traditional IRA/401(k) investments like stocks, bonds, and mutual funds. However, Rocket Dollar is overkill if this is all you’re planning to do.
This is just a taste of the vast universe of investments you can make with your Rocket Dollar account.
You could even invest in cattle, racehorses, and livestock through the app. Money laundering regulations restrict investments in ATM-based businesses but, other than that, you can invest in practically anything.
What Are Rocket Dollars Fees?
Rocket Dollar is a bit different than other investment tools because they do not charge assets under management fees. Instead, Rocket Dollar has a subscription-based pricing model. Users can choose between two plans:
- Core: $15/mo ($360 one-time fee)
- Gold: $30/mo ($600 one-time fee)
The one-time setup fees apply for any new account, regardless of size. Once your account is set up, you have to pay the monthly subscription fee to keep up your plan.
Rocket Dollar Review: Core Plan
The Core only includes basic features, such as:
- LLC to hold investments
- Investment management tools
- Online document storage
- Email support
- $0 account minimum
Rocket Dollar Review: Gold Plan
The Gold account is the premium service and comes with some nice additions. Gold members will get access to all of the core features plus:
- Checkbook control
- Priority support
- Expedited transfers
- Debit card
- Tax filing assistance
- 4 free wire transfers per year
The Gold plan also includes some great features. It’s a worthwhile upgrade if you plan to use Rocket Dollar to manage your primary retirement account.
Rocket Dollar Benefits
Rocket Dollar is unique and not for everyone. But it can be the perfect tool for the right kind of investors. Here are some of the platform’s most notable features:
Nontraditional investment asset classes:
Rocket Dollar’s single most unique feature is the ability to trade in unconventional asset classes. Most IRAs and 401(k)’s will not allow account holders to purchase nontraditional assets, so you can’t take advantage of the tax benefits.
However, Rocket Dollar users can get around these restrictions and make tax-advantaged investments in a wide range of alternative asset classes.
These sorts of investments might enjoy certain advantages or peculiarities that other standard investment classes don’t have. Rocket Dollar does the work of handling the administrative work of managing these assets.
100% self-directed investment:
Unlike some other investment services, Rocket Dollar is 100% self-directed. You can invest in anything you want, as long as it’s compliant with federal regulations.
Solo 401(k) plans:
You can set up solo 401(k) plans with Rocket Dolar. Solo 401(k) accounts have expanded contribution limits and better tax benefits. You can also take out loans against these kinds of plans.
The flat-rate subscription model is more affordable for investors with larger accounts. It only adds up to a fraction of what you’d pay at a firm that uses an AUM-based model.
For example, if you have $6,000 in your account, then a $15 monthly payment costs less than a 0.25% AUM fee.
Rocket Dollar helps you make nontraditional investments while adhering to regulatory guidelines. You can also rest easier knowing your account is compliant with federal regulations.
Rocket Dollar Review: The Verdict
Rocket Dollar is a unique platform that offers users the opportunity to invest in a wide variety of assets under their retirement account.
More advanced investors will appreciate the chance to make tax-advantaged investments in a wide range of assets. However, you probably don’t need Rocket Dollar if you’re only interested in basic investing options.
This app is an excellent fit for advanced investors interested in expanding their retirement portfolios beyond stocks and bonds.
Rocket Dollar’s unique ability to facilitate these transactions makes it a game-changer for these types of investors.
The tax advantages alone make this app a worthwhile investment. If you’re interested in buying alternative assets through your retirement account, you should definitely give Rocket Dollar a close look.