Written by: Trista Winnie

What do boat slips, fishing rights for sablefish in Alaska and seahorse farming have in common?

Water, for one thing. More importantly, they are all investment possibilities within self-directed individual retirement accounts (IRAs).

"Initially I had my funds in a pension and 401(k)....When I retired, I didn't know what to do with those funds," Tony Moreno, a self-directed IRA holder who is planning a seahorse farm off a private island near Honduras, said. "When I learned about the self-directed IRA...and found how much flexibility there was in what I could invest in, that seemed to be the most logical place for me to put that money."

Moreno said he began to do research into international real estate, looking for sandy beachfront property. Eventually, he decided to try to purchase a private island.

"I was thinking of doing something like creating a subdivision and selling lots...but when I went there and saw [the island], I realized it wasn't really suitable for that," Moreno said, because much of it is government-protected mangrove forests. "One of the things I came up with was to use the island for creating a seahorse repopulation effort...by creating a habitat area on the outskirts of the island."

Visitors to the day resort Moreno is building on the island will be able to view the seahorse farm. Moreno said he expects an influx of visitors to the area because Carnival Cruise Line is building a $50 million terminal on nearby Roatán Island.

Traditional IRAs are limited to investments in stocks, bonds and mutual funds. Self-directed IRAs, on the other hand, are specialized accounts that allow their holders to invest in anything except for life insurance, collectibles and investments that would personally benefit them or close family members, as restricted by the IRS.

Real estate and businesses, among other things, are common investments within self-directed IRAs.

"As a general rule of thumb, the IRA is going to be prohibited from being invested with or in a way that benefits an individual that is [in] a close, personal relationship to that IRA holder," David Nilssen, CEO of Guidant Financial Group, a self-directed IRA facilitator, said. "For example, I can't buy a rental inside my self-directed IRA and rent it to my mother."

As millions of baby boomers approach retirement, pensions are on the wane and Social Security is poised to become unreliable. That leaves many people depending heavily on their retirement accounts to fund their retirements.

"As people live longer, you know, retire at 65, live to 85, that's 20 years they've got to provide for themselves," Tom W. Anderson, CEO and founder of PENSCO Trust Company, a self-directed IRA custodian, said. "No longer can you just park your money in a retirement account and expect to get by."

"People have got to start managing these retirement accounts, and I think the self-directed industry is a great way to do it," he said.

Read the original article to learn more options and strategies available to investors who wish to diversify through a Self-directed IRA.