The New York Times published a story yesterday entitled The BlackBerry as Black Sheep in which it profiled people who are growing increasingly embarrassed to use their Blackberries in public. The Blackberry doesn’t provide the same functionality as the current breed of smart phones, and users come off looking like communications cavemen who are stuck with outmoded devices. Blackberries are not the first product to suffer what is officially known as technical obsolescence. Ever since the industrial revolution started steaming ahead, products and services have fallen as easier, more productive, and cheaper alternatives have become available. Washing machines replaced washer racks, fiber optics replaced copper wires, and online trading services have replaced the traditional stock broker. After all, why would you want to pay somebody else a significant fee to place a trade for you when you can do the same thing yourself faster, easier, and cheaper? A similar process has been occurring in the self-directed retirement arena. Previously, investors who wanted to open a self-directed IRA had to sign up with a custodian who would hold the funds and charge fees for every hassle-filled transaction. Over the past few years, however, the pendulum has begun to swing signifying the coming end of the custodian model. The platform replacing it is known as Checkbook Control, and it allows investors to place investments in real time with no paperwork and zero transaction fees. Functionally, the two platforms are similar; they both allow for retirement investing in alternative assets. However, the ease and economy of Checkbook Control is quickly pushing it into the role of the new norm. The question that remains is where will investing go with its newfound freedom? When online trading services opened their doors, there was a huge upswing in stock market trading. Now that self-directed IRAs are becoming user-friendly, perhaps we may start seeing a shift in the opposite direction. Now that it’s easy to invest in real estate or other alternative assets, why would the common investor choose to stay on Wall Street? Of course, if they still need a place to use their Blackberry, that would be perfectly understandable.
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