Rocket Dollar Review: Alternative Assets for the Self-Directed Investor

Rocket Dollar offers a unique suite of alternative investment options beyond stocks and ETFs. A self-directed Rocket Dollar account unlocks investment opportunities including crowdfunding, startup lending, and real estate rental income. Find out if this self-directed platform is right for you in our full Rocket Dollar review.

This broker is a good fit for: Traders seeking off-the-market opportunities with self-directed alternative investments.

Top perks

Self-directed retirement accounts

Rocket Dollar simplifies the complexity of self-managed retirement accounts. It handles back-office documentation and connects users with preferred investment partners. The broker offers both self-directed IRAs and solo 401(k) accounts. As retirement accounts, a Rocket Dollar user's investment will grow tax-deferred (tax free with a Roth IRA). This means investors can save thousands of dollars in tax savings on high-yield investments.

A broad universe of investments

With a self-directed retirement account, investors have the entire universe of IRS approved investments at their fingertips. These investments go far beyond the traditional stocks, bonds, and mutual funds. Some of the investment opportunities available to Rocket Dollar users include:

• Real estate
• Metals
• Commodities
• Cryptocurrency
• Equity crowdfunding
• Private equity lending
• Startup lending
• Conventional lending
• Peer-to-peer lending

But what if your investment of choice isn’t available on the Rocket Dollar platform? Its team has you covered.

Bring Your Own Deal (BYOD)

Self-directed investing can be tough without a support team. Luckily, Rocket Dollar's team can guide you through a wide range of situations, including bringing your own investments to the table. By working with the Rocket Dollar team, users can turn an unlisted deal into an investable opportunity.

What could be improved

No traditional investments or accounts

For some traders, the investment opportunities presented by a self-directed account are well worth forgoing certain other investment accounts and asset types. For many, though, the lack of access to more traditional investment types is hard to ignore. Rocket Dollar does not allow traders to buy stocks, bonds, ETFs, mutual funds, options, CDs, and other traditional assets. Additionally, it does not support brokerage accounts, margin accounts, HSAs, or custodial accounts. Rocket Dollar is not designed for the average investor, instead catering to the experienced. Investors should perform due diligence before deciding whether self-directed investing is right for them.

High fees

The brokerage industry is in a race to the bottom when it comes to fees and commissions, which is why Rocket Dollar's $360 ($600 for Gold) upfront fee can give investors sticker shock. Even the $15 per month ($30 for Gold) fee is significantly higher than the few other brokers charging a subscription fee. Rocket Dollar may make opening and using a self-directed retirement account easier, but its price may be too steep for some users.

Rocket Dollar prides itself on not offering traditional investments, including stocks, mutual funds, or ETFs.

Rocket Dollar charges its users a one-time setup fee, followed by a recurring monthly fee. It offers two membership tiers, Silver and Gold. The Silver membership includes all of the features listed in this review. The Gold membership caters to investors seeking a whiteglove experience, and features priority support and a debit card for investment-related purchases. Rocket Dollar does not charge a commission fee.

Rocket Dollar's trading platform is incredibly simple, allowing users to view investment balances. The broker's IRA as a Service (IRaaS) platform is available on desktop only. Because many of the alternative investments available to users are not traded on exchanges, the platform doesn't include transaction controls.

While Rocket Dollar's self-directed 401(k) accounts allow for loans, users cannot borrow margin as they can with other brokers.

Because Rocket Dollar does not offer traditional investments, it doesn't offer traditional research reports. However, there are a variety of resources available on the broker's website, including guides, webinars, and eBooks for the less experienced investor.

• You want a universe of alternative investments. Rocket Dollar allows users to trade nearly every self-directed investment legally allowed by the IRS. With over 10 different alternative asset classes to choose from, the sky's the limit for Rocket Dollar traders.
• You're an experienced trader looking for self-directed accounts. For most investors, a passive investment strategy using traditional investments is plenty to secure a strong financial future. For those who are experienced and practice due diligence, Rocket Dollar puts the reins in your hands.
• A high upfront fee won't scare you off. Most brokers don't charge a commission anymore, let alone a startup fee. However, Rocket Dollar's administration of your self-directed accounts may be well worth the added cost on the front end.

At The Motley Fool Ascent, brokerages are rated on a scale of one to five stars. We primarily focus on fees, available assets, and account types; however, we also take into account features like research, education, tax-loss harvesting, and highly rated mobile apps. Our highest-rated brokerages generally include low fees, a diverse range of assets and account types, and useful platform features.

See our full methodology here: Ratings Methodology