I'm curious how other SDIRA (Self-Directed IRA) owners who don't use a property management company handle rent collection.

For years, our process has been simple: residents purchase a money order or cashier's check and mail it directly to our SDIRA custodian. It's worked well and has been easy for everyone involved.

Recently, though, I had a very young first-time renter tell me she'd never filled out a check or money order—and had never mailed a letter before. She wanted to pay me with Zelle, Cash App, or Venmo, which obviously isn't an option with an SDIRA. I was happy to show her how, but it got me wondering if these traditional payment methods are becoming less familiar to newer renters.

I also recently learned that our custodian accepts ACH payments directly from a tenant's bank account, so I sent her the information to get that set up. It seems like it could be a much easier option going forward.

For those of you who don't use a property management company:

- How do your residents pay rent?

- Do you use mailed money orders/cashier's checks, ACH through your custodian, or another SDIRA-compliant method?

- Have you changed your process over the years? If so, what led you to make the change?

Paper Check thru the Mail? Here in California, the Postal Inspector Sits by a pool sipping his Margarita and watches girls in bikinis. Nothing is done to stolen mail, including stolen checks. At least 1 out of 3 persons experienced stolen mail within the past 2 to 3 years.

Filing a report with the bank, if lucky, will result in a refund within 5 months.

Instead I have my tenants send payment thru Zelle, PayPal or Direct bank Payments/Transfers.

This year alone a tenant purchased a Postal Money Order and mailed it to me. The Mailbox at the street corner had someone with sticky tape and a string fish out envelopes mailed. That tenant I was able to evict before the Funds were returned to him --11 months later.

For "Fund" I"m not allowed to receive, tenants may a bank online payment to my authorized person/manager.

I don’t accept any Zelle type services for rent. They can pay check, Cashiers check , MO or ACH. They can also set up auto pay at most major banks.

When it comes to my SD accounts, I am very old school. For the few houses I still do have (and I slowly shifting away from buying houses in my Solo account and SD Roth IRA), I have them snail mail the checks. ETC does offer an online payment option for our residents.

I have had one sign for that service when it first came out. He has moved out about two years ago and I am seeing where that payment gets accepted by ETC and about two days later it gets pulled back.

I have called ETC and they said it was the tenants bank that is doing this, I have talked with the tenant, and he is saying it is ETC. Who is correct? Don't know - but it looks messy. The good news is there hasn't been fees associated with it and both sides are doing a fine job pointing their finger at the other.

If getting too involved with your SD account property management is your concern, an attorney speaker who is on the board for a self-directed company said there has never been a ruling on self-management, but he also said he wouldn't want to take that case either.

I have a financial friend who was kind enough to open a bank account specifically for a property held in an SDIRA. The tenant sends money to that account via Zelle. Property taxes, contractors, and other expenses are paid out of that account. Surplus is sent to the IRA custodian every year or so.

Robin: Thanks for sharing your experience—I'm still learning, so I appreciate the insight.

Is your financial friend compensated through the SDIRA for these services? If so, what's a reasonable fee, or are they simply doing you a favor?

I previously asked my realtor to help with something similar, but they weren't comfortable with it. I also contacted a title company about opening an escrow account to handle property-related payments, but they weren't interested. I'm just trying to find the fairest approach for everyone.

Ray: Thanks for your perspective. I was starting to question whether it's worth switching to a larger company that offers direct payments or staying with the smaller firm that's treated me well overall.

WMH: We're still using the old-school paper check method.

JS: We're getting a lot of younger tenants these days, so I'm open to newer ways of doing things.

You can't use your realtor for an SDIRA transaction. Look up Prohibeted Parties or whatever it's called.

A friend, yes. A STEP-child, yes. But not a fiduciary partner or a child or a parent (think up or down the family tree.) You can use a sibling though.