To Thine Own Self Want more investment options? With a self-directed IRA, you decide where your money goes.

Interested in a retirement-friendly, tax-deferred way to invest in, say, reality TV? How 'bout a beach house in Malibu or a burger franchise in Eastern Europe? Self-directed IRAs can help. Unlike traditional IRAs that limit investors to stocks, mutual funds and bonds, this alternative account allows for a broader, more creative range of assets, including real estate, private equity, foreign companies and even racehorses.

David Cole, a private developer in Fort Worth, Texas, uses a Solo 401(k) to invest in a reality television series and two real-estate development projects in his neighborhood. Now, he's investing in two real estate development projects and a reality TV series. "My purpose was two-fold," says Cole, 44. "I wanted to take advantage of opportunities in real estate and defer the taxes, [as well as] diversify away from the stock market."

The payoff from a self-directed IRA can be higher than an average mutual fund, but the related dangers may be greater as well, experts say, because it's not as diversified as a basket of stocks, funds and bonds. "The higher leveraged you are in any investment, the greater the risk," says Nora Peterson, author of Retire Rich With Your Self-Directed IRA. "For example, if you've only got $2,000 and you buy someone's tax lien, it could be great. But if you haven't done your homework, the [entire] IRA can be lost." What's potentially more risky, says Jeff Nabers of the IRA Association of America, is that self-directed IRAs don't have built-in advisors, like mutual funds do. "It's almost like you're the manager of your own little mutual fund," says Nabers. "The whole thing can be dangerous for a variety of reasons.unless you find professional advisors to keep you safe."