Investing with Self-Directed IRAs
What You Need to Know

Looking for a powerful tool to invest your retirement savings outside of the stock market? Look no further than self-directed IRAs! In this video, we sit down with Amanda Holbrook, a specialist in self-directed IRAs, to discuss the many benefits of this investment strategy.

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Transcript

one of the most valuable lessons I’ve learned over the past decade in real estate is how essential it is to learn
from the industry professionals that’s why I’m gathering professionals from across the country to share their
experiences with you this is a gregerson’s podcast where experience and passion come together in
the world of real estate I’m Casey Gregerson your host and I’m very excited you’re tuning in to today’s episode as
always if you have questions for me or any of our guests please reach out to me at Casey
gregersonproperties.com now let’s get started with today’s podcast we’re here with Amanda Holbrook so she is going to
be your specialist when it comes to self-directed IRAs and and give us all the knowledge we need to know because
it’s such a powerful tool so where do you typically start with somebody who’s like completely green and new to this so
where you start with this it’s you don’t know what you don’t know Casey I think that is like half of the conversations
that I have on a weekly basis you know I’ve worked with a financial advisor you know a traditional brokerage house and
you know planning firm and they were never told I can invest my 401k Ira
outside of the stock market and not get taxed why you know that’s usually the
first light bulb aha moment and then after going through the you know well here’s what you can do it’s the why
didn’t I know about this you know 5 10 15 20 years ago you know is typically that conversation you know so I
appreciate you just hopping on here because that’s it is creating the awareness I think that is needed
especially at this time in where we’re at in the market I mean you tell me if
you work with investors day in and day out you know and you talk about their retirement accounts too I just get a bit
more technical you know what emotion is that evoking right now when you open that statement yeah 100 we just
especially when they don’t well a it’s like they’ve yeah they’ve seen the volatility in the stock market have not
yeah don’t speak highly of that at the current moment but then we started to direct them into hey like the
opportunity within real estate and have it to be backed by a hard asset that’s like that does appreciate over the time
that doesn’t have the volatility yeah it’s definitely an easier conversation these days than maybe it has been in the past yeah you know and I mean I’ve been
you know personally in this industry for a long time at you know as his all the members of our firm and it’s you know
kind of starting off with that same starting line is where I’ll start for your listeners today is you know I get
this all the time as you know oh Amanda I I logged in you know logged into my account and it says self-directed right
there on the screen and it’s like well that’s not truly a self-directed IRA because on those you know and I’ll leave
the big name Banks out of it but you can pick whichever one you want you know they will say hey log in here and you
can pick your stock spawns mutual funds yourself and that’s not true self-direction that’s just a little
sandbox of toys that you get to play with you know where a true self-direct directive platform everyone is when you
get to invest in what you know you know so I’ve been around since the 70s nothing brand new so what else exists
out there besides stocks bonds mutual funds and you hit the nail on the head I mean you know do you want to invest in
real estate right let us show you how you want to be a private money lender invest in a fund great let me show you
how yeah I would say Casey like nine out of 10 of our in our clients are
typically in real estate in some way shape or form you know and for those of you that are just getting into this and
you’re like I’ve never done real estate before but man I’ve got that old corporate 401K that’s sitting there like
not making me happy you know what’s out there for me you know and there are very easy ways to like dip your toe into the
pool to where you’re going from you know the stock market right you know goes a
little bit like this you know with no control all right versus you know if you’re just even getting into real
estate I mean look around you you’ve got four walls the ceiling and a floor that’s real estate what is what is one
of the three basic needs of every human on the planet a home you know so that’s where when you take that just oh that’s
logical you know and you can put that in a tax sheltered account where it’s tangible it’s insured and it provides a
consistent predictable cash flowing income or you know cash flow into the retirement account tax-free or tax
deferred looks like well win-win-win like why don’t we do this you know and that’s
where the education and bringing of the message is that you can unlock that old
401K make it self-directed and put it in a deal one two three so typically when
we’re having a conversation with somebody who’s interested in using a self-directed IRA and we we probably get
past the kind of the little education piece of of why it’s beneficial and and all that like what’s the typically step
to actually if somebody’s got some funds ready to invest in a self-directed IRA like what’s the next step other than
introducing them to Amanda yeah I was gonna say the first step it’s like who do I do do how about my calendar let’s
have a conversation I think that’s that’s it but literally guys it’s application paperwork no one wants to
hear that it’s a done-for-you DocuSign Everyone likes that so we do the DocuSign all pre-filled out for you
click to sign the most laborious thing is a statement and a driver’s license that’s all we’re gonna bug you for and
then we have a whole team we’re headquartered in Albuquerque our whole team goes and gets the funds from A to B
without you in the middle and that process happens within two weeks or less you’re ready to do the deal yeah so that
is like oh my gosh it has to be more complicated than not it’s not wow and
that that’s another big question I had is the timeline from yeah once they’re ready to pull the tractor or go
self-directed Ira um have those funds ready it’s literally could be two weeks before they’d be
ready to move it and put it to work correct yeah and then once the funds are here you know I think one of the other
common misconceptions is you know twofold you know once it’s here does it have to sit here for amount of time do
you have to have like you know 500k in account to be able to do this what’s the
minimums that kind of stuff you know once the account is here you could do a
deal that day it can the investment can go out the only requirement we have is a thousand dollars stay in the account
that’s it you know so if while that two-week period is happening Casey you know is
there anything stopping you from identifying a note or a rental property or participating in a fund and getting
that paperwork in order with the titling no you know the goal is to make it a domino effect you know as far as like
the the minimums I mean we do these for kids I mean I don’t have my filter on
today so you can see my my little ones in the background here you know ask me if they have Roth IRAs they sure do you
know how did I take 500k and put it in there no because you can’t one you know two but you start with a thousand bucks
you know it doesn’t you know you know there’s easy ways to build these and there’s ways to do it not just for you
but for your family um and put it into tangible Investments so that you have you know one little
funny mnemonic device I always use Casey’s you know tax free you know I
challenge you to say that say tax free yeah you’re smiling man and everybody
listening they just did that out loud and made yourself look silly you’re smiling too yeah
that’s all that’s right okay so backing up a little bit because this is a big
question I get is like especially when it comes to real estate so people think hey if I’m investing in real estate I’ve
got a it’s a bigger barrier entry there’s like it’s not like I can go put a thousand dollars I can just put a
thousand dollars into Apple stock but it’s hard for me to put a thousand dollars into a real estate deal it’s typically if you’re gonna fund a deal by
yourself you might be putting in a hundred five hundred thousand or if you’re partnering on a deal different
sizes right just talk about the different Avenues to actually getting into real estate say you’ve only got
because again what’s the minimum per year you can put into a self-directed IRA it’s like yeah so for this year yeah
6500 if you’re under 50 7 500 over so I mean the IRS makes it so you can’t take
that 500k and just dump it in an IRA one day yep yeah so that’s the minimum so typically what do you see people
building and I know there’s a couple strategies we can break down here whether it’s like doing a little bit each year and taking a small deal but
how what are some ways people can do it in chunks as well sure so I’ll touch on that so you know breaking it down just
super simple is there’s pretty much Three core ways you can do deal structure right yeah so number one would
be outright hey I’ve got 200k saved up I’m gonna do you know buy rental property for 200k perfect you know if
you do it a little bit less because you need Reserve cushions but just for example’s sake right that would be an
example of outright you take down the deal 100 in the name of the retirement account 100 of the profits come back to
the retirement account 100 tax shelter right think of it like its own little bubble that’s self-sustaining expenses
come from and go to profits come back it all stays in the bubble now what if you have so number two would be partnering
you know say you had a barrier to entry of 100K for a fund all right and you’ve
got husband has 50k and old 401K over here and wife has 50k in the ira can
they do that deal sure just partnering together yeah just partner them together on the titling
it’s the titling’s long and I’ll just forewarn you there but you know specialized Trust Company custodian fbl
husbands Ira 50 undivided interest and then the same thing for the wife you know you’re not co-mingling funds that’s
just like if you and I partnered on a deal like I know you’re super sweet but are you going to give me more profits than what I put in probably not
if you guys can see those facial expressions it was funny that’s exactly it so there’s no
co-mingling you know there’s no breaking of the rules there the third one is leveraging now leveraging you know we
all know the acronym OPM I’m gathering yes other people they’re people’s money yeah well guess what you know the IRS
made these vehicles that that I’m dead I’m putting down payment
and borrow the remainder inside of the self-directed 401K is the one I like to
see this one in you know where if you were say flipping that property or you
were renting it out you know the profits come right back into the account 100 tax
sheltered and then you would pay that monthly mortgage payment from that account now the same thing with the flip
you’d pay off your private money lender yeah and then all the proceeds would come back 100 tax sheltered No Cap gains
the key is the type alone so I want to make sure this is Uber clear all right the rule with the IRS is that there’s no
personal guarantee of the debt IRAs 401ks cannot guarantee that loan so what
kind of loan is that it’s an asset use loan the technical term is a non-recourse loan everyone you know so
if you had where do I get those you know there’s a list of Institutions that do
them and it could be your old buddy from college that has a tired 401K from his
old employer could be your our next non-recourse lender for your deal you know so those are like you know if
breaking it down into like Lanes yeah those are kind of the the three lanes of creative deal structure got it okay so
that’s really helpful so those examples are still bigger amounts right so but you talked about like what are some
scenarios people can kind of relate to and think about to where maybe they could get to a 50 or 100 000 or say two
hundred thousand dollar investment but not have to wait putting in 5700 or 5800 a year what have you typically typically
seen I know a couple of these but then there’s a lot of avenues to where they could like money that they can move into a self-directed yeah so I’ll touch on
that twofold so money they can move into a self-directed you know and for any of you guys listening if you want my little
hot sheet of what what funds can be self-directed you know we’ll put the info in the link here but you can if you
have old 401ks IRAs roths tsps for those that served in the military or a branch
of the government for 57b’s different comp plans inherited good IRAs are a big
one you know all of these types of retirement accounts that you’ve grown to know you know can be self-directed you
know so that’s one way to get more you know money in the pot to start with you know the other one is we’ve touched on
contribution limits and yes the IRS does limit how much you can take from your packet and put into the account but
Casey is there a cap on the earnings of your investment nope nope yeah so what are some examples
especially in this Arena of low barrier to entry you know with high yield
results um wholesaling comes to mind that’s a big one is wholesaling any type of
creative joint ventures um creative deal structure financing tax liens is another great one you know
that’s a beautiful one worst case scenario in a tax lien what do you end up with yeah you’re whatever the tax
rate Rose to the a little bit yeah property
or the property that’s it that’s exactly it you know and the reason I poke you know a little bit of fun there is you
guys that I just painted a worst case scenario the worst case scenario in a low barrier to threshold investment
would be oh my gosh you end up with a property can you say that about you know a random
stock portfolio or a mutual fund no you can’t so that’s where it’s just drawing
you know the pros and cons like apples to oranges comparison and it’s diversification you know these
are just diversification tools that allow you to not have all of your eggs
in one basket in the stock market you know that allow you to have you know some differentiators inside of your
retirement accounts that are tax sheltered a lot of times we see it outside and that’s great but what if
you’re closer to retirement I mean and you’re stuck in the market and I asked
this with clients you know like well what especially those that get the aha moment and they’re closer to retirement
well I was why was I never told that I could do this you know and it’s I can’t answer that
question I’ll let you fill in the blank of why you think you weren’t told yeah but getting the message from a
professional across the desk or the zoom you know of weather the storm it’s
cyclical and you don’t have time to weather the storm that’s a problem and although you may you know point at a
professional across the table like it’s your money like you have control of that
whether you think it’s like in this Untouchable land and I think that’s just a mindset shift Casey and I’ll ask your
opinion on that too because I know I deal and see that all the time it’s just kind of breaking down that barrier and
it’s like huh I can control this just like I do my other investment funds in
my LLC huh okay I can call the shots that’s what self-direction is guys you’re the boss like you call the shops
you don’t have someone telling you what to do yep yeah no that’s really good so and
then the other thing just as far as rules on like there’s a lot of times where you can move if you’ve been doing like when you leave a job right I’m
curious some of the example I know one example is say if you leave a job and you still you kept your 401k or whatever
retirement you that typically is eligible for self-direction are there any other examples like that to where
you can get these bigger chunks and make them self-directed yeah yeah so the the
qualifying event is always like hey I’ve left a job I had an old 401k can I tell
you the average 35 year old has done this between three to five times if that gives you an idea like of how much money
is out there you know that you know they just kind of gets left in the dust you
know or they’ll make them a rollover Ira which means it was a Once Upon a Time 401K so those are all funds that you can
roll over partially or full into a self-directed account you know so I will say that’s the number one source and I
will tell you if you’re feeling like oh my gosh I can’t tell her how many I have I don’t remember where they were my
record is 17. 17 accounts yeah that we we like
consolidated into one you know but I have a news flash for you you’re paying fees on those accounts you know so it
does behoove you to you know make sure that you know where those are coming from you know so old 401ks IRAs 403bs
um I have a lot of teachers that have like their state purrs like their pension plans that can be moved the
qualifying event here guys that I’m mentioning is you’ve either left the job or you’ve turned 59 and a half
like if you’re a 30-year in corporate guy or gal and you’re over 59 and a half
and you’re still there even though you’re still employed you can move some of that money if not all of it and even
if you are still employed and under 59 and a half I’ve got a tip this is something called an in-service rollover
and that’s a little trick to the trade some plans allow for you an in-service rollover meaning you can move that big
chunk over while still being employed if your plan allows it yeah so that’s the
key is to ask if it offers an in-service rollover now if you call up customer service and they tell you immediately no
they didn’t check all plans are made differently
IRAs Casey Casey you have a traditional IRA or you know something you were told to do a
Roth in college and it’s all just been sitting out there and you put money into it because it’s been automated but
you’re not really controlling the growth you know those are ways to put more you know having existing funds to you know
fill the bucket bigger is what you’re saying got it okay because that was when I wanted to make sure you highlighted is
the people that do have a 401K with their employer but they’ve been there for a long time so it sounds like they just need to talk to their HR talk to
the right person maybe don’t take the first answer dig a little bit deeper and What’s the phrase what should they ask
them again in service rollover if it’s your current employer and if they say no
just trust but verify guys I appreciate your time do you mind following up with me in that in writing it’s written in
your planned documents so they should send you a copy of your plan documents to see on it so I love it so this really
you’ve opened the door for everybody right so this is people if you’ve been with your if you’ve changed jobs at any point you can move that if you’ve been
in a job for a long time there’s a chance you still can and then all these other other scenarios where they’ve been
contributing to an IRA all the other different retirement accounts sounds like this could apply to anybody really
who’s been who has a retirement account has been probably going for five to ten years A lot of people are more than
likely going to have some chunk of funds that could contribute no absolutely you know and there’s also like the two that
are missed a lot um health savings accounts you can self-direct oh that’s one that’s missed a lot that’s like I
called the master of the double dip meaning the money you put in you get a tax deduction but it grows tax-free and
we’re all going to have health ailments guys at some point [Laughter]
we’re all we’re all going to have to you know do a little tune-up at some point right you know so the more we can grow
you know for health expenses that’s not a bad thing you know there’s college
education savings accounts called a coverdell or a cisa yeah those can be self-directed too you know so lots of
good stuff let me ask you Casey do you work with a lot of do you have a lot of clients that are entrepreneurs or have
like a side hustle LLC in addition to their W-2 job yeah a lot of people like
yeah like that right there is a big one because if they’re in W-2 world you know
I’m no CPA I’m not a tax an attorney blah blah blah you know all the disclaimers but like the tax code’s not
written for that W-2 earner you know so if you have that side hustle LLC or you are a full-time entrepreneur you know
there are things like the Roth solo K and the SEP IRA that instead of like you
mentioned the 6500 you can put away as a person IRAs or personal accounts you
have a heartbeat earned income social security number like that’s it you can go ahead and have an IRA but if you’re a
business owner 6 500 a year is not going to move your tax needle is it
no yeah what if I gave you a vehicle that allows you to do 66k
66 000. how would you do that yeah that’s a step Ira or a solo 401K it’s
based on what your company’s doing you know so it can be 25 of the net up
to that 66 000 you know the 401K sliced a little bit more but even if you have a
corporate 401k and you’re contributing to that that doesn’t stop you from
having a solo this is like the entrepreneur’s version of a solo okay Casey yeah it’s the entrepreneurs 401k
and I’m talking about it’s literally the triple threat retirement accounts is that Ross solo 401K what’s stopping you
from having that and you know your employee benefits at your W-2 job nothing you know if you worked 15 places
and they all offered a 401k don’t you to get the free money from all of them sure
if you have your own company you know it’s not about what you make it’s what you
key yeah right yeah yeah you know and that’s the other part of the whole self-directed equation guys like yeah
these are great for growth and diversification but how about let’s keep a little bit more in our pockets you
know that that’s a big part of it too yeah cool well let me do that so we’ll
keep going with it so if somebody puts in or I guess a question I get a lot is if like for example on our real estate
fund if it’s a minimum of a hundred thousand dollar investment and like you said one example if they got 50 and they get somebody else with 50 they can
partner together make it work in a one Ira what else though what would you advise them if say they want to use
they’ve only got or they just only want to use 50 000 of self-directed whether it’s that’s how much they have or that’s
all they want to use and they want to bring in other investment funds how would that typically work damn it would
be the same yeah it was partnering the same way so if you had to do it on the same note or
the same like share of the of the deal you know it’s just that titling is what
makes it kosher so there’s no commingling that’s the heavier cake you need it too Casey so I’m sure I get this
a lot uh you know is Amanda this retirement account stuff’s great and I’m
the retirement account lady right so they’re like when I ask them where do you want the profits you know they feel
obliged to say well in my retirement account of course you know you don’t have to tell me that we all want cash
flow today so how can you have your cake you need it too it’s just partnering those different funds together you know
is how you’re able to do it and how it’s done compliantly is that undivided
interest it’s in the titling so you’re saying that yeah so you could put retirement money easy numbers 100K
investment I could put 50k from my salt directed Ira I could put 50 000 of cash and then as this fund say this fund
distributes every quarter that cash flow from the 50 000 of the self-directed IRA
obviously that states in the self-directed ira you don’t touch that to retirement but the other piece yeah you would be able to collect on right
yeah so when they’re setting out that quarterly disbursement instead of sending you know one ACH check wire
they’re sending half of that amount to the IRA and half to them personally that’s all okay gotcha and any other
complications let’s say that they want to put it into a a specific deal and invest in with a because again one
caveat let me know if I’m wrong here but if you put it into a self-directed IRA you need you can’t be buying your own
property with it or how does that work as far as like a third party yeah so these are like the Cardinal rules
everybody’s like oh there’s got to be so many rules there’s really not that many it’s just knowing it’s the number one
big one is what you’re mentioning so it’s called self dealing all right and I
love all of you creative minds out here because this is the one Amanda let me pick your brain you know and what is
scenarios this is the number one that comes up is you know if you self-dealing
example Amanda I have this Cash Cow of a you know a quad you know four unit
property and it’s just I love it I would love if I could just take my IRA and just buy it for myself so it’s all tax
sheltered what do you think yeah your name probably a nay unless we get really
creative no Nay it’s always nay [Laughter]
because you own it personally right you’re buying it from yourself guys it’s
a retirement account the IRS wants you to benefit it from it when in retirement
not today so if you’re doing a deal structure with your retirement account or you’re benefiting today then you
probably shouldn’t be doing it another example I get this one too especially for my creative ones well what about if
it’s an LLC Amanda because technically that’s not me it’s an entity yeah what
happens when I we peel back the layers of that LLC who wears the buck stop
yeah that’s the the number one that I hear a lot you know so just don’t
self-deal and if it’s gray stay away I mean you know I can give you all kinds
of rhyming the IRS just keep it clean
um number two so I’ll touch on this one because you’re working with other investors right and we don’t just invest
for ourselves we invest for family right you know the big picture you know so if you remember growing up
like drawing out the family tree like think of a physical tree y’all so you’ve
got you your spouse parents grandparents children grandchildren if they’re in the trunk of the tree you cannot do business
with them with your IRA so your father couldn’t lend to your company from his Ira you couldn’t buy a duplex near the
University where your kids go to college and rent it to them you know these would all be like prohibited okay
beneficiaries of fiduciaries are in that mix too you know but who I didn’t list or the
branches brothers sisters Aunts Uncles cousins nieces nephews what do you think yay
fair game yay okay so be nicer to your siblings y’all
so to give some examples of that if I move my money into a self-directed IRA I
cannot go buy my own property with it um I’ve got to go basically invest that with someone else who’s not my dad or
not my son but could be my brother or any other person essentially correct that’s armed length at arm’s length Okay
because say they’re a limited part say they buy them to fund where they’re now a limited partner of that fund but I
guess that’s in their self-directed Ira it’s titled that and all the money flows through there just better understanding
the selfie so if you’re passive okay so if you’re passive in the fund okay
and there you’re a minority owner you know so you’re not you don’t own 100 you
don’t over own over 50 it’s actually the combination of disqualified individuals I just listed is not over 50 could
dreary participate yeah per the rules yes so I’ll break it down more like it is
simple because not everybody here gets like the structure of funds and what all you know a limited a GP would do you
know so think of it if you’re benefiting outside of the retirement account from what your retirement has doing are you
compensating yourself like when I get all the time is you know some of my one-man armies out there that are like
well we manage our own properties or we manage our own single-family rentals can we still manage those you know as long
as you’re not compensating yourself from them yeah because that’s self-directing you know you’re just making sure that
the rent is paid and it’s paid right to the retirement account you know the funds are flowing how they should you’re
not compensating yourself um same thing for like we work with a lot of real estate agents or those that
even side hustle and happen to have a license if they list a property they acquired in their retirement account for
sale on an MLs can they take up commission
they’re paying themselves you know so those are like examples you know the
what if scenarios and if you’re not quite sure you know if it’s in the gray
stay away like I said we’re not attorneys we’re a passive custodian is literally or like category you know if
you’re unsure get an attorney or a legal opinion letter you know that’s always like you’re safe you know you feel safe
you know get someone to say yeah this looks good and that’s why you have a team right you’re not you’re not out
there trying to do this yourself yeah okay you have you have folks around the table that have that experience and
that can point you in the right direction got it okay yeah so let’s continue to play this out so they put in
the hundred thousand dollars into the fund through their self-directed Ira they put that at play with the fun the
fun has a life of four years they’re every time they take a distribution or get a contribution from the fund those
stay in the self-directed IRA and then after four years the fund is closed out all the principal comes back plus your
investment right so then they’re kind of back to square one and then they’re just they just keep the money in there right and they can decide okay what’s the next
project do I want to do more real estate do I want to do stocks and bonds but they kind of just keep it going right
and and just throwing that over time is that typically what you see absolutely you know so when the funds come back
it’s all tax shelter right you know now what do I want to do next do I want to do this again you know did you like that
do you want to be more passive do you want to be more active you know that’s when you make those diversification calls okay and just keep it going over
time and then right so then let’s fast forward so you’ve started with this hundred thousand it’s grown over the
years now we’re sitting on I mean there’s crazy stories of how much that can grow we actually was on a podcast
with one guy who started he just started with a couple minimums he I think the initial Capital put in was only about 20
000 and he did what you said he he wholesaled it a couple times flipped it and it’s like it’s like seven million
dollars at this point of tax-free income so let’s say you did that you rolled your hundred thousand into seven million
at the end of when can you start to draw on this and what does that look like once you’ve assumed turn for 59 yeah
yeah so 59 and for that gentleman did it in a Roth and was like Yay because all that’s
tax-free you know so at 59 and a half go ahead take that money out when it’s Roth
you could take all of it out at one time because you’re never paying taxes on the distribution you know if you’re any of
these tax deferred funds you know the traditional 401K traditional IRAs you
would pay taxes on whatever you take out at that time you know the the Roth it was only born in 97 the 401K piece 06.
you know so those those vehicles I don’t even think we’ve really seen how powerful they can get but that is a
great example you know it’s when you invest in what you know your returns
will be greater you know when you invest in tangible stuff you know typically what you can control you know are your
returns typically greater yes and can you do it in a shorter amount of time and that’s the part I love hearing
stories like this because yes leverage that’s why leveraging is such a huge tool here I mean why do we leverage
outside of our retirement accounts to get to your cash flow goal sooner right yeah it’s the same principles here
it’s just you haven’t had the floodgates open to realize like wow all this creativity I’m doing over here I can do
over here in tax shelter at land too huh got it so to highlight Amanda’s point of the Roth IRA again you pay taxes before
bringing it into that retirement right so you pay taxes at that point it all grows tax-free so I’m curious though
again say we’re combining funds from multiple retirement accounts you’ve got a Roth IRA that’s got 50k for easy
numbers and you’ve got your 401k from your other job it’s another 50k and you want to put that together in a
self-directed is that just a counting thing at the very end when you turn 59 or yeah because they’re separate
accounts so you know they’re tracked separately so you can decide you know
what which bucket you want to pull from obviously the tax-free I mean there’s some real cool we won’t get into the
Weeds on this but there’s some really cool conversion strategies you can do within the accounts it’s switching from
one to the other when I get from like my real my my young hot wholesalers it’s like retirement you want me to save for
what like yes pay less taxes now save for some retirement do a couple deals a
year you don’t even have to put your own money in it just do a couple deals and I mean you will have millions that you can
pull from at that point and it’s the same thing for like kids play with a compounding interest calculator plug in
40 years I mean your kids are millionaires and if you really want to you know play the math game if you will
but yeah it’s and there’s also going back to like you know if you’re if
you’re listening and you’re younger and you’re like retirement is so far off like where there’s a will there’s a way there’s certain
um there’s certain Tax Strategies like a 72t that will allow you to access funds
sooner but it’s not stuff that you would typically even hear about because in the stock market world you know it doesn’t
provide that consistent predictable income so that’s not a vehicle we hear about often but in real estate world I
mean if you have a rental portfolio or you know private lending to commercial funds oil and gas Etc that provide
consistent predictable income could that work it could it could work it does work I mean we see it in clients accounts all
the time got it while we’re on the top of your real estate so any other scenarios you think are worth mentioning
from so again if somebody wants to put some money in and they want to if they’re experiencing enough to know how to wholesale they could wholesale if
they want to fix and flip a property they could do that if they want to buy a rental property they could do that as long as they’re not paying themselves
it’s within the rules right if they want to be more passive they can go invest in a fund they can go be a private money
lender and be the bank for another investor would be rules have you seen any other typical ways people have used
self-directed funds in real estate you know I would say
shine a little bit is that solo 401K you know so it’s we all want some cash flow
now right I mean you know you’ve got kids young still Etc you know more cash
flow today is you know would help but it’s a retirement account there’s one instant gratification tool when you do a
solo 401K is you can borrow against it 50 or 50 000 whichever’s first it’s a
restriction free loan guys so this pertains to if you if you were stuck at an employer and you can’t move those
funds check into that is if you borrow that money you’re you’re borrowing it from yourself I hate even calling it a
loan Casey because it’s like four savings when you pay it back it goes into the account just like when you guys
hear how to Arbitrage like your home equity lines of credit this is kind of the same thing except the interest is
going back into your account you know so if you’re paying yourself back six percent but you have the opportunity to
make 12 over here hmm does that make Financial sense of course you know I
think that’s one of the the the most underutilized tools because we just hear it for oh use it for emergency
consolidation blah blah blah blah you know I think that’s another big big big reason you know especially if you’re in
W-2 world you have that side hustle you know the one thing I will say like as far as parting words if you’re not quite
sure where you’re at or how this would work for you or if and when it works you
know I always offer like hop on my calendar we’ll have a conversation and just see where you’re at you know it
isn’t for everybody but majority it is you know it’s not a matter of if it
makes sense it’s just when you know when it makes sense and it’s better to know you know a couple steps ahead of time
you know you may be on chapter one and others are on like chapter five eight ten and that’s okay I don’t compare
where you’re at because those where you’re reading their chapter 10 and their great success stories like oh my
God how do I get seven million dollars tax-free in my Roth like he started somewhere and it was literally and you
know this in real estate like a lot of times your one conversation or one introduction away from having a pivotal
shift yeah and we get to see that all the time just due to like the networkings and masterminds and your
podcasts I mean it’s magical it really is you know so don’t be shy take action
talk yeah last thing to add to that is add when is the right time for people so if they’re thinking about it I think I
know your answer but when should they reach out and start to look at moving money into a self-directed IRA no of
course yeah or like what sort of like do they need to have a certain amount they need like is there any really barrier to
this no really there isn’t a barrier and that’s what I wanted to make sure was you know if you’re listening that that
was made very clear you don’t have to be at like that 500k Mark to start and I
hear that a lot you know it’s like Oh I thought I needed a lot more to get started and you don’t you know so I mean
even if you’ve got a couple thousand saved you know I’m not gonna say oh you can’t be on my calendar no talk about it
figure out where you’re at and what you’re looking to do and then it’s reverse engineering the numbers nine times out of ten you know we find more
funds than they knew they had to work with and through some of the more creative stuff they’re able to do deals
sooner and they get results and that’s that’s all we can ask for that’s great and I’m glad you just
mentioned that because I think a lot of people to be listening to this thinking oh well I’m not quite sure I heard a lot of this but I’m not quite sure what
money I can move it sounds like you’re open to having a conversation letting him know hey yeah you’ve got all these other funds that you could be doing
self-directed and you’re willing to do that huh absolutely since we’re a passive custodian Casey we don’t
recommend or endure specific investment or investment sponsors you know so they tell us hey I want to do this widget or
this that’s fine that’s great you know but we’ll show you the how and like
where you may have access to funds you didn’t even realize and a lot of times that conversation even goes above and
beyond just the retirement accounts which is great and then that’s where like having the right team you know is
there’s sometimes I’m going to give you solutions that I will have nothing to do with but it will put you in a better
position and that’s great like that is still a win in our book you know because when the time comes or if you’re using
other people’s money to scale like you know that that comes back around and I think that’s where like our mentalities
match as far as you know it’s very it’s very win-win like you know you help a
person today regardless of the outcome right we’re always providing education and value and that’s what I meant by
like we don’t have specific you know specific Investments and that’s why you know like Casey we work so well together
you know because I can bring the how and it drives me nuts because I’m like I
can’t show you exactly where to park it but like oh wait we met through Casey Casey can show you how to show you some
examples of how that works that’s that’s perfect um oh yeah likewise and again to our
point when we have conversations about hey they’re interested in self-director area where do they start but they don’t know what to do and and I’m not the
custodian it’s great make an introduction to Amanda Amanda can direct you and again whether it’s you want to go into real estate or whether you want
to stay in stocks or whatever investment you want to make like you get that freedom so yeah control me a lot Amanda
this has been really really helpful I think I think really I think you’ve broken down a lot of the walls and a lot of the things that are maybe holding
people back from starting a self-directed even if it’s a small chunk that’s why I highlighted that at the end I knew I knew we knew the answer but I
want to make sure people took that take away nothing’s holding you back from now from having tax-free wealth thank you
all right well appreciate that to you thank you guys for listening appreciate putting this together Casey and looking
forward to the next time we meet that we’ve got like three of our own case studies like success stories we can
highlight how about all you listening Let’s help us make that goal happen [Laughter]
well thanks again man as you may have learned by tuning in to this episode of Gregor sense the easiest way to make
real estate investing hard is by going at it alone so as you continue learning and seeking knowledge of the industry I
want to encourage you to build relationships with other professionals who are passionate about real estate whether that’s an agent a business owner
or a managing investor like myself there are Pros that want to see you succeed and are willing to help you by sharing
their experience you can always reach me by visiting caseycrackerson.com and scheduling a call I look forward to
connecting with you and continuing to share my experience with you here on Gregor since mobile until next time I’m Casey Gregerson thanks for tuning in