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Strata Trust Company has been in operation since 2008 and is based out of Texas. They are a company that serves as a financial custodian for self-directed IRAs. Nowadays, the firm manages billions of dollars and has more than 50 total employees.
But is Strata everything it seems? How do they stand up to the competition, and what should you know before using them as an IRA custodian?
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About Strata Trust Company
Strata Trust Company offers self-directed IRA services to both individual investors and professional entities. They are one of several licensed custodians that are qualified to handle self-directed IRAs. Many IRA custodians don't have the licensing to manage self-directed IRAs.
Strata's first name was Self Directed IRA Services. Since rebranding, they have broadened their reach to more investment partners. The company's overall goal is to help investors save for retirement by combining traditional assets with alternative ones.
Strata states that their company is built on trust. They want to stand out from the competition by offering ongoing customer service and solid investment options. Whether they actually accomplish this is debatable, though, as the company has been subject to multiple complaints online.
The company has listed a number of key advantages that are supposed to set it apart from the competition. When you have Strata manage your IRA, you get the following benefits:
All of that is good, without a doubt. But it doesn't necessarily explain what separates Strata from the competition. All IRA custodians are subject to the same rigorous regulations, and all self-directed IRA custodians have high levels of flexibility.
Similarly, any company with more than 50 employees is likely to have decades to centuries of combined experience. And individualized customer support should be the rule, not the exception. There are other companies who offer customer service that's just as robust.
The biggest draw of Strata is how strong its network of investment partners is. It's true that there aren't many competitors that can give clients access to the same huge number of investment options.
Strata Trust Company Fees and Scheduling
There is one very positive aspect of Strata's setup: their fees. They are extremely transparent about the different account fees. Every fee is charged on an annual basis, so you don't have to worry about huge monthly bills.
If you want to set up a flex IRA, basic IRA, or precious metals IRA, the company will charge you $50 for the process. That includes walking you through all of the paperwork and funding your account. This can easily become overwhelming if you try to do it by yourself due to the complexity of the IRS regulations.
Setup fees are the same for each of these accounts, but the maintenance fees are different. Flex IRAs have a $250 annual cost to maintain, while basic IRAs cost $100 annually to maintain. Precious metals IRAs have the lowest maintenance cost at just $75, though this doesn't take into account the potential cost of storage.
Basic accounts cover public investments. These are assets like LLCs, real estate trusts, certificates of deposit, and brokerage accounts.
Flex IRAs cover non-public alternative assets, such as actual real estate, private company stock, and private notes. Precious metals are also part of this account. If you want an IRA that has other types of assets on top of precious metals, this is a better choice than the precious metals option alone.
If you do choose the precious metals IRA, that will focus exclusively on IRS-approved silver, gold, platinum, and palladium products.
There are some additional fees that you should be aware of, on top of the regular account fees. All recur annually:
Segregated storage is storage that is separated from everyone else's. No one will ever have access to your holdings except you and your custodian. But this isn't strictly necessary, especially considering that every account is fully insured for the value of the precious metals inside.
Now, there are some non-recurring fees that you might run into for different aspects of your account. For example, you'll need to pay $50 for wire transfers or for requesting your account records. You might think that those things are covered by the annual maintenance fee, but they aren't.
There are other custodians who do these things for free. Some customers have reported that they were surprised by the transaction fees, because they'd never encountered anything like that before.
You can directly pay your fees online through the Strata website. The company accepts all major debit and credit cards. All you need to do is input your card information through the secure portal. It's also possible that you might be able to set up recurring automatic yearly payments.
The company also allows you to reach out through their website if you have customer service questions. You can fill out a form with your query and then submit it. There's also a customer service line available during certain business hours every week, which you can reach out to with any questions or concerns.
Strata Trust Company Reviews
A company's reviews give you a good sense of how they have interacted with customers in the past. Strata Trust's reviews tend to be mixed. They have a low customer rating with the Better Business Bureau, along with several complaints.
Other third party review sites show a range of reviews. On Trustpilot, the company has a relatively good reputation, with a total score of 4.4 stars as an average of 862 reviews. This is where you can find the most concentrated customer feedback.
Let's take a look at some of the complaints, along with some of the positive feedback that customers had.
Negative BBB Reviews and Complaints
Negative reviews and complaints have been posted on the BBB website. The BBB is a place where people can post about grievances with a company in order to have their complaints addressed. Of the seven consumer reviews on the site, there's an average of less than 2.5 out of 5 stars.
There have also been a whopping eight complaints filed in three years. Of those, five were filed within the previous twelve months. That seems to point to a developing issue with the company management, and it's not clear what Strata is doing to address this.
Of the eight complaints, four were related to billing, and four were related to issues with products or services.
The most recent complaint was written in August of 2021. It states that the customer first opened an account with a different company, and then was made to open an account with Strata. The customer could not opt out of this. Their prior account had not been charged any fees, but their account with Strata was.
The customer went on to say that Strata did not provide them with any investment opportunities, and that all the company did was manage their prior account. They believed that the management fee they were charged was too high.
The company responded to say that the customer actually had signed an agreement to open an account. In the agreement was information about the fees and other disclosures. The respondent went on to give the customer information on when the agreement had been signed and where they could find more information about their Strata account.
Another complaint from 2021 said that for two years, the customer had been receiving invoices for accounts they had closed several years before. Though the customer had explained the situation to Strata and asked that the charges would be dropped, the company failed to stop sending the invoices.
Strata responded to the complaint to say that an investigation showed that the account had been improperly closed by the client's investment company. After discovering the error, Strata properly closed the account and reassured the customer that the invoices could be discarded. The customer stated that he found this to be a satisfactory resolution.
One complaint said that the person invested in precious metals for an IRA. After being unhappy with Strata's service, they transferred their custodianship to a different company. That company valued their precious metals IRA at less than half of what the person paid for it.
The company responded to say that they did not sell the precious metals to the complainant. Instead, those were purchased from a precious metals dealer. They then explained how they value the assets in an IRA, along with the disclosures they make about potential risks.
Another complaint said that the customer had been informed in writing that they would be subject to a fee of $200 for their account. That written agreement did not explain that the account fee would change to $250 the following year.
Strata responded to say that they made the decision to increase their account fees due to the ongoing economic impact of the COVID-19 pandemic. They further explained that the account holders had been given advance notice of the change. They offered to close the customer's account free of charge if he wanted to transfer his assets to a different custodian.
The customer said that though he appreciated the offer, he had already paid his annual fee. He asked to be allowed to transfer his assets at the end of this fiscal year. Strata responded by refunding him and helping him close his account, which he said that he found to be satisfactory.
In each complaint, Strata has made an effort to explain the issue to the customer. Sometimes the problem seems to be that people signed paperwork without reading about what exactly they were signing. It's important to always look over the full document before you sign anything new.
Positive Trustpilot Reviews
The company asks customers to review their experiences on Trustpilot, and there have been more than 800 responses. Most of the responses are positive, but only 50% give the company five stars. That's a red flag, since most of the consumer base should be having a five star experience.
Perhaps more alarmingly, 18% of the reviews have just one star. That means that nearly one out of every five respondents had a terrible experience with the company.
That said, let's take a look at some of the most positive things that customers have to say.
Several reviews name customer service representatives and praise them for how helpful they've been in their counsel. Customers say that the team is knowledgeable, friendly, and respectful. One review said that Strata gave them advice that helped them save significant money on their investments.
The most consistent praise has been for the friendliness and helpfulness of the staff. Several customers have said that they recommend the company based on that alone. If it wasn't for the other poor reviews and complaints, we would take that as a sign that this is a great place to invest.
Is Strata Trust Company a Scam?
Strata Trust Company is not a scam. Despite not being accredited with the BBB, they do have an A+ rating for their handling of customer complaints. They also have a high level of transparency, as you can find information about all of their top staff right on their website.
However, that doesn't always mean that they're the best company to invest with. There have been several negative reviews and complaints filed, which should be taken into account. Other companies have less overall negative customer feedback.
Pros & Cons of Strata Trust Company
Strata Trust Company is a company with a broad range of assets available for you to invest in. Instead of specializing in precious metals, they work with general alternative assets that can be stored in a self directed IRA. Unfortunately, they don't always have the best reviews.
There have been some negative reviews and complaints posted on the BBB website. Though there are more positive reviews on other websites, customers still tend to have a mixed opinion. There are some indications of poor customer service and management.
That said, the company does have a high level of transparency. It publishes information about all of its upper management, and it has an A+ rating with the BBB. Every time a complaint has been filed, the company has responded to explain and resolve the concern.
Overall, if you want to invest in a precious metals IRA, we recommend working with a different company. It helps to have someone who can streamline the process for you. Strata Trust doesn't have good enough reviews for them to be one of the top financial partners that can manage your self directed IRA.
Overall, we believe that there is a better option when it comes to your investment.
The above company is our top recommendation after doing extensive research. Feel free to keep doing your own research, or you can visit Strata Trust Company below!