Do You Want the Path of Least Resistance?

You know in the ‘ole days, it was not uncommon that many CPAs, Brokers, and Accountants would tell their clients that self-directed IRAs and 401Ks were “illegal.”  Many of these professionals may not have been trying to steer their clients out of selfish interests…they just may not have known that such accounts, as long as established and executed correctly, are quite legal.

Then 2008 came and not only did it seem that many of these professionals became aware of such plans, it almost seemed that “self-directed” anything became the new buzz words.  Heck, it even seemed as if everyone wanted to set up such plans (evidenced by the fact that I have had more than a handful of people ask PGI if we could train them to enter the field).

So, I never thought I would be doing a post on this topic…hey, it’s been so long, I almost feel like I am going retro :) .  But, I was speaking to a new client this week and he actually told me that he reviewed a self-directed 401K with his broker first and was told that such a plan was “absolutely illegal.”  Feeling discouraged, he felt as if his broker may have selfish interests, so he reviewed it with his CPA.  Guess what?  Well, his CPA never said it was illegal, but said he had “never heard of it before.” [Read more...]

Reading Information from the IRS . . . Hooray!!??

Okay, all bad humor aside, there are some IRS publications that people should and might even want (notice I didn’t say enjoy!) to read, especially if they are interested in creating a self-directed IRA or 401K plan.  You might be asking why you would want to read such material.  Well,

1)  Some people, including myself, still believe that you can’t learn everything that you want to learn by just watching YouTube (sorry, YouTube).  Heck, even if you could, I think YouTube has the ‘ole “we are not responsible for content” disclaimer well established.

2)  If you are establishing a self-directed plan and utilizing a company like PGI (or any other company) to establish your self-directed IRA or 401K, NO company in the market place assumes responsibility for your self-directed decisions and investments.  And, yes, even for those custodians who “hold” your funds and assets…they clearly state in tiny, tiny print on their application, that they are not responsible for any investment you make, or your compliance with IRS regulations.

IRS Publications [Read more...]

Real Estate Investing For Retirement – Purposeful Planning III

BawldGuy Note: By necessity, this post is longish. I promise you though, it’ll be worth it. This step in the Purposeful Planning process is often overlooked and its value discounted. That isn’t advised, as you’re about to learn. Thanks for readin’ through.

We’re finishing up Step #3 in the process of creating a Purposeful Plan. In yesterday’s post we created an investor, giving them a financial ‘status quo’ based upon my ongoing experience. Turns out they have decisions to make about the potential sources of their investment capital.

The decision is crucially important.

In this virtual case study, it’s sometimes possible that this decision can and will dictate the quality of retirement possible. It’s akin to laying a building’s foundation. The larger, deeper, stronger, and more reenforced it is, the larger the building can be built. It’s how real estate investors begin that will often ensure success, failure, or merely mediocrity. Many times the difference in starting with more or less available capital can literally make or break the end game goal.

Factors they are considering. [Read more...]

Real Estate Investing For Retirement – Purposeful Planning II

Last week we talked about the first two steps in the Purposeful Planning process. If ya missed it, go ahead and catch up. We’ll wait.

Today let’s talk about the third step of any Purposeful Plan.

Step #3 — Identify your source(s) of investment capital.

Seems self-explanatory doesn’t it? Much of the time it is. There’s the cash in the bank. Maybe some stocks here and there. Or, takin’ advantage of today’s historic low interest rates, maybe the home equity is calling to you to put it somewhere else. You know, to more effective use. But, what most don’t even consider, is where many have bunches of available real estate investment capital — A 401k or IRA from a previous employer. An IRA sittin’ dormant for the last few years. Your instincts stopped you from continually adding to it, but you’ve been stymied from that point for awhile.

The case for gutting your 401k or IRA [Read more...]

Study Shows How Investment ‘Diversity’ Is Defined – How Strategies Are Chosen

As you know, I do not provide investment or financial advice….I am not even sure that I spell those words correctly.  So, that being said, you always want to review everything you do from an investment standpoint with your team of professionals….now, doesn’t that sound impressive…your team of professionals?!

However, while not ever giving advice, I continually find it amazing that when the “experts” speak of investment diversity, they always maintain such diversity within the arena of stocks, bonds and mutual funds.  In a recent article by Margarida Correia related to a recent study undertaken by SEI. A fund manager and investment management business outsourcing provider, the SEI found some common sense opinions currently held by investors.

The Study [Read more...]