Rating
4.3

Introduction

Rocket Dollar was founded in 2018 with the belief that retirement is changing. They believe that people should not be limited in their investment options as they work towards the retirement they envision for themselves.

Investing in bonds for retirement or stocks is quite easy. Why? Because you have an assortment of choices to pick from. However, if you are interested in agriculture, precious metals, and real estate, you will realize that the process can get a little complicated.

As such, you will be better off working with a renowned investment company (…like Rocket Dollar perhaps?).

Rocket Dollar has often been described as the game-changer in the world of data-driven investments. But does it live up to the hype?

Our review unearths every little thing you need to know about this fin-tech invention from Austin Texas.

An Overview of Rocket Dollar

Rocket Dollar was launched in 2018 as a way to offer investors a better and easier method to hold retirement assets that cannot be held in conventional brokerage accounts. The platform enables you to open an IRA or Solo 401 (k) that works with virtually all assets.

When you create an account with Rocket Dollar, it sets it up like a company. In some states, the company will open a limited liability company and what that means is that the platform enables your IRA to run its own business.

How It Works

Essentially, opening an account with Rocket Dollar is quite simple. All you will be required to do is to sign up for an account online, sign some papers, and start funding. As you begin funding your investments, you can write a check and begin purchasing any legal investment.

Now, the platform is quite straightforward looking at it at first but as you get into it, you get to realize just how much Rocket Dollar does and how easy it can be to mess everything up.

An account opened with Rocket Dollar, also means a concurrent limited liability company, which is owned by your account. Any money received from investments or used to investment goes to the LLC's checkbook. 

With the LLC in charge of your investments, it is easier to remain compliant with the laws regulating self-directed investments. Nevertheless, you want to be careful when selling and buying assets. Rocket Dollar does state that it is unlawful to purchase assets that you own or self-deal.

What it includes

You may be wondering what you get when you decide to invest through Rocket Dollar and here is what to expect.

  • Self-directed retirement investing — other investment brokers will sometimes allow you to pick your own stocks and mutual funds. Rocket Dollar hands you full control so that even if you so wished, you can get yourself a herd of cattle. 
  • IRA LLC — We have previously mentioned that you open an IRA account alongside an LLC one when you decide to use Rocket Dollar. That means that the IRA LLC becomes the legal holder of your assets. This is what makes the self-directed retirement account function.
  • Checkbook control — As soon as your account is open, you get what is known as checkbook control, and what that means, is that you get to purchase assets with the account's checkbook. For instance, if you are closing on a property, you will pay with your Rocket Dollar account to make it the owner.
  • Flat fee — the thing about opening an account with Rocket Dollar is that there are no sliding costs. You will just pay $15 every month. However, Rocket Dollar recommends paying this fee with an external debit or credit card to avoid tax implications and draining your account balance.
  • Fast setup — As far as opening an account with Rocket Dollar, you can do it within 10 minutes and you will not be required to have a minimum starting balance. All that is required is your contact details regarding how you intend to fund the account as well as your social security number for identity and tax purposes.
  • Gold service– If you want a gold account, you can get it for $30 monthly. It includes everything including tax filing services, debit cards, and checkbooks, along with expedited services.

Pricing and Fees

Just as we have previously mentioned, Rocket Dollar runs on a flat monthly rate of $15. This is ideal for bigger investors. Why do we say this? Think about it this way. If you have $100,000 in your account and you pay $15 every month, that translates to $180 annually. This further translates to 0.18% every year. This is lower compared to the 0.25% to 0.50% fee that is typically charged by Robo-advisors.

Rocket Dollar charges a one-time sign-up fee that goes for $360. What you will probably love about Rocket Dollar is that it does not feature any transaction fees because all investments are bought directly using your trust bank account or LLC.

The required fees can be paid using a debit or credit card.

Who Are the Partners?

Investing in a self-directed IRA means you can invest in practically anything. Nonetheless, Rocket Dollar works with a few digital investment partners whose work is to make it easy to invest in gold, real estate, cryptocurrencies, precious metals, and other substitute investments.

Now, we feel like Rocket Dollar is a reputable company, but some of its listed partners need to be looked into. This is because Rocket Dollar's investment partners are not specifically solid, but we cannot say they offer bad investments either.

It would be wise to do your due diligence before committing your money to an investment partner.

Should you Be Investing in other Options?

The first thing we are going to tell you is that Rocket Dollar is affordable and makes it easy to utilize retirement funds to invest in substitute products. This makes the platform a must-consider, but who exactly will benefit from it most?

We think that people should avoid using retirement funds to fund alternatives until they establish a great record of accomplishment of fruitful investing.

Here is some context for you. Someone who owns a couple of rental properties understands how to purchase real estate. That makes them the ideal candidate for this kind of account. Likewise, an artist who intends to become an art investor is likely to gain from selling collectible art. 

In some cases, investing in substitute asset classes can be very fulfilling and lucrative but in some cases, you may end up losing a lot of money. Alternative investors need to handle both sections of the spectrum.

Who is Rocket Dollar For?

Is Rocket Dollar the right pick for you? Why don't we look at some of the persons who can benefit from it?

Ordinary Retirement Savers: Rocket Dollar was exclusively designed to help people with managing their retirement savings with more than what is usually offered via conventional brokerages. As such, this may be the best product to help you diversify your retirement portfolio with peer-to-peer startups and loans and real estate.

Seasoned Investors: While it is possible to invest in conventional investments like bonds and stocks via Rocket Dollar, the platform was created to offer investors access to more investment options. However, some of these securities such as startup companies' cryptocurrency fluctuate, they may be best for seasoned investors.

Day Traders: You get to monitor your portfolio's performance without any help. This makes it a great choice for seasoned day traders who will not have a hard time assessing and picking investments.

Small business owners and Self-employed Individuals:  Rocket Dollar offers self-directed IRAs and solo 401(k). Such investment options and usually designed for people who run small businesses and those who are self-employed.

Is It Legit?

We can assure you that Rocket Dollar is a genuine business, only that it is quite new to the market seeing as it was founded in 2018.

The company is not registered with the BBB or listed by CFPB. This means that you may be taking a risk trusting your assets with a company that has not had enough time to build a reputation for itself. You also want to keep in mind that some investment options can be volatile and illiquid.

You can therefore choose to enlist a professional accounting advisor or do it on your own. Even by opening a conventional IRA via Rocket Dollar, you will still be required to manage it.

Pros

  • Setting up an account is quite easy
  • The platform allows for investing in alternative IRAs
  • It features numerous investable assets
  • It allows you to purchase almost anything

Cons

  • The setup charges for accounts are quite high with new accounts going for$360, while their Gold ones cost $600 to set up.
  • You will be required to pay $15 monthly for a core account and $30 for a gold one
  • The IRS outlaws retirement investments in gems, alcoholic drinks, and collectibles.

Conclusion

Rocket Dollar offers an ingenious way of building a retirement portfolio that will have alternative investments. However, since such investments can be risky and complex, they are best suited for seasoned investors with a high level of risk tolerance. 

Of course, you can always look at some other options to get a second opinion.