Self-Directed IRAs Can Now Include Litigation Finance and Structured Settlement Investments
TL;DR
Next Generation Trust Company enables investors to gain high-return advantages through litigation financing in self-directed IRAs, offering significant profit potential from successful legal cases.
Litigation financing works by providing non-recourse cash advances to fund legal cases through self-directed IRAs, with returns based on settlement percentages or investment multiples.
This approach helps plaintiffs access justice funding while providing investors passive income opportunities that can secure better financial futures for retirement planning.
Investors can now fund legal battles through their retirement accounts, turning courtroom victories into portfolio gains with structured settlement purchases at discounted rates.
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Next Generation Trust Company has published guidance on incorporating litigation financing and structured settlements into self-directed retirement accounts, highlighting two alternative investment opportunities within the legal sector that can provide passive income for retirement savers. According to Jaime Raskulinecz, founder and CEO of Next Generation, while structured settlement investments have existed for some time, litigation financing represents an emerging trend in alternative asset investing that is gaining traction among retirement investors seeking diversification beyond traditional stocks and bonds.
Litigation financing involves self-directed IRA owners providing non-recourse cash advances to fund legal cases, supporting plaintiffs or law firms in exchange for a portion of the final settlement award. This investment structure carries significant risk since returns are contingent on case outcomes. As Raskulinecz explained, This is a passive investment and as a non-recourse transaction, the investor only makes money if the case is successful. Therefore, the risk is relatively high but there is potential for high returns—usually based on a percentage of the damages or a multiple of the initial investment—if the case is won.
Investors can access litigation funding opportunities through various channels, including single case investments, portfolios of legal cases, specialized funding groups, online platforms, or hedge funds that focus exclusively on litigation financing. The approach allows retirement savers to participate in legal outcomes while potentially achieving returns that outpace traditional investments, though the high-risk nature requires careful consideration and due diligence.
Structured settlements offer a contrasting investment profile with significantly lower risk. These arrangements involve court-ordered compensation payments to plaintiffs that are distributed over multiple years, similar to annuities. When plaintiffs opt to sell their future payment streams for immediate lump sum payments at discounted rates, investors can use self-directed IRAs to purchase the rights to these future payments. The SDIRA receives steady passive income because the payment schedule continues according to the original setup, with income greater than the investment amount, and there is little risk involved.
The availability of these alternative investments through self-directed retirement plans represents an important expansion of options for investors seeking to diversify their retirement portfolios beyond conventional assets. Both litigation financing and structured settlements provide exposure to the legal sector's financial dynamics, offering different risk-reward profiles that can complement traditional investment strategies. More information about SDIRAs and the many alternative assets these plans allow is available at https://www.NextGenerationTrust.com.
Curated from 24-7 Press Release
