When you’re preparing for retirement, the key to building a successful nest egg is regularly saving more money for retirement and making investments that earn enough interest to significantly increase your general fund. By achieving these two goals, you can combine your retirement money into a very healthy fund to live on in your later years. Unfortunately, traditional IRAs won’t earn you much interest, and you’d probably be better off using self-directed IRAs for at least a portion of your retirement account to help increase your interest earnings.

Just funding your IRAs with the maximum annual contribution each year is a good place to start saving for retirement, but it probably won’t be enough unless you’re making some very high-interest investments from your IRAs.

Self-directed IRAs give you the ability to invest in things like precious metals, real estate, and tax liens. These are the investments that can generate respectable returns for your account as long as you are careful and make wise investment decisions.

Take, for example, real estate or tax links. If you use your retirement money to buy some rental properties, you could earn a respectable amount each month through rent. Sure, you’ll spend time paying the purchase price of the property with rent, but when you’re done with that, your retirement account will grow every month. Tax liens do the same thing for you because you are essentially collecting interest from liens on other people’s property. Many investors combine these two investments, because any bonus that goes unpaid will land the investor a new property that they can then rent out for an even higher level of profit.

Investing in real estate and tax liens is a great way to start earning a steady stream of income for your retirement without even counting your annual contributions, but only if you make good investment decisions. If you buy a house that people don’t want to rent, you’ll be forced to pay property taxes and deplete your account every month you stay there without making money. Tax liens can also hurt your fund if you get liens on houses that are falling apart.

By carefully investing your retirement funds in more lucrative opportunities, like real estate, you can generate impressive returns that give you more to live on when you retire. But be smart about the investments you make and avoid betting all your money on one investment. That’s the key to building a respectable retirement account.