The self-directed IRA landscape continues to evolve as investors seek greater control, diversification, and access to non-traditional assets. With macroeconomic pressures like inflation, volatile public markets, and changing tax policy shaping retirement strategies, SDIRAs offer a unique solution: tax-advantaged investing with the flexibility to pursue alternative assets that align with an investor’s goals and expertise.
As we move through the second half of 2025 and look ahead to 2026, several trends are shaping how investors approach self-directed retirement planning. Here’s what’s driving growth—and what investors should keep in mind as they navigate this space.
Broader Adoption of Alternative Assets
One of the defining features of SDIRAs is the ability to invest in alternative assets. In both 2024 and 2025, investor interest has surged in opportunities that go beyond stocks and bonds—particularly among those with knowledge in specific asset classes. Common investment types include:
- Private real estate (residential and commercial)
- Private equity or private debt
- Precious metals
- Cryptocurrency held via compliant custodians
- Crowdfunded business ventures
- Crowdfunding platforms
Self-directed IRAs are not a new topic. In fact, they have been around since 1974. With the rise of accessible information, more investors are learning their options can be more than only what the stock market has to offer. This broader range of asset classes allows investors to diversify based on what they understand —through proper due diligence and IRA compliance remains essential.
Real Estate Strategies Shift in Response to Market Forces
Real estate remains one of the most popular investment types within SDIRAs, but 2025 sees a notable shift in strategy beyond traditional single-family rentals:
- Multi-family and co-living arrangements, which address the growing demand for affordable housing.
- Flex spaces and shared work environments, responding to the sustained rise of remote and hybrid work models
- International real estate opportunities in locations like Costa Rica, Portugal, and Mexico, particularly for tourism or rental income.
Note: All property must be used strictly for investment purposes and not for personal enjoyment. Compliance with IRS rules on prohibited transactions remains critical. For international investments, it is crucial to consult an attorney with experience in international investments to ensure that a foreign entity can own the property.
Artificial Intelligence Fuels Smarter, Passive Investment Tools
Artificial intelligence is rapidly influencing the way investors evaluate opportunities. By analyzing market patterns and reallocating assets automatically, more investors are being drawn into the predictive insights AI investing platforms have to offer. In fact, many self-directed IRA investors are utilizing AI investing platforms to diversify and grow their money with minimal active management as they await their next major alternative investment.
Growth in Social Impact-Aligned Investing Gains Grounds
In 2025, more self-directed investors are using their accounts to align their retirement dollars with environmental or social priorities closer to their values.
- Affordable housing or community redevelopment
- Renewable energy infrastructure
- Sustainable agriculture projects
Note: While these assets may align with personal values, they must be vetted with the same due diligence as any other investment to ensure they meet IRA requirements.
Demographics and Legislative Updates Supporting Growth
Younger investors are increasingly aware of alternative investment options and are beginning to leverage SDIRAs to pursue them. Additionally, updates under SECURE 2.0 in 2025—including enhanced catch-up contribution allowances—offer greater flexibility and higher savings thresholds for older investors.
- Millennials and Gen X are entering their peak investing years and are more open to alternatives than older generations.
- Catch-up contribution limits expanded in 2025 under SECURE 2.0, allowing those aged 60-63 to contribute an additional $10,000 annually.
- The Department of Labor and IRS continue to provide clarifications on alternative asset custody, especially regarding digital assets and foreign holdings.
These developments create a more favorable climate for SDIRA adoption, especially among investors who value customization and are comfortable conducting due diligence.
Passive Syndications and Private Funds on the Rise
While direct real estate ownership remains popular, professionally managed private placements—including private equity funds, real estate syndications, and private debt funds—are on the rise.
Drivers of Growth:
- A growing number of Investors prefer passive structures that don’t require hands-on property management.
- More fund sponsors are designing offerings specifically for SDIRA eligibility.
These structures appeal to investors who want diversification without the demands of day-to-day management. As always, it’s crucial to evaluate tax considerations such as unrelated business taxable income (UBTI) or unrelated debt-financed income (UDFI). Check out this resource that includes information about how to calculate UBIT & UDFI, if it were to occur.
Cryptocurrency: Still Niche, But Still Here For a Reason
Despite a volatile history, cryptocurrency remains a niche but persistent interest among SDIRA investors. In 2025, it’s important to understand these key points when using a self-directed IRA to invest in cryptocurrency:
- Digital assets must be held through a qualified administrator or exchange.
- Personal wallets or self-custody are strictly prohibited to avoid disqualification.
- Accurate documentation and reporting are essential.
Final Thoughts: Looking Ahead to Late 2025 and Beyond
The SDIRA market in 2025 reflects a maturing landscape—defined by greater investor control, expanding access to alternative assets, and the growing need for diversification amid a changing economic landscape. As investor expectations evolve and access to alternatives widens, self-directed IRAs offer a meaningful way to build a more customized, tax-advantaged portfolio.
To stay ahead, investors should:
- Stay current with evolving IRS and regulatory guidance
- Perform in-depth due diligence on all investment opportunities
- Partner with an experienced IRA Administrator and trusted professionals.
As the market matures and continues to expand access to alternative investments, SDIRAs will likely play an even larger role in long-term wealth strategies for investors across demographics.
