Recipe to Retire Wealthy: Add Real Estate Investments to Your Portfolio

“The secret to mastery in any field is to forever be a student.”

~ Martin Palmer

Almost every single industry has had a complete makeover in the last two decades. Let it be retail, healthcare, automobile, and even real estate. Unlike the earlier days where you would spend several days in marketing a property, adding lawn boards and distributing pamphlets in every mainstream real estate club, real estate nowadays is all about understanding the latest technology trends and implementing them to achieve maximum exposure for your property. However, one thing hasn’t changed and that is the lucrative capital gains that one could reap after completing a real estate transaction.

For a majority of real estate professionals, investing in retirement funds is overrated and they would prefer purchasing a rental property instead of making IRA contributions. However, if you come to know about a retirement plan that allows real estate investments, tax-deferred gains, and loan option for funding; isn’t that an interesting proposition!

Solo 401k is a retirement plan that caters to self-employed professionals and small business owners who are looking for flexible investing opportunities. Realtors usually don’t heed retirement funds because of their lower contribution limits and confined investment choices. Solo 401k for self employed professionals is an exception both in terms of contribution limits and investment choices.

Unlike other retirement plans, Solo 401k plan allows annual contributions of up to $52,000 in 2014 and $53,000 in 2015. If you are past the 50 years old, you can contribute additional $5,500 in 2014 and $6,000 in 2015 under catch-up contributions.

What makes Solo 401k a perfect retirement plan for Realtors is its ability to invest in real estate. One can invest in real estate, precious metals, tax liens, private businesses, and similar industries. So, if you are planning to purchase that condominium or rental apartment as a part of your retirement planning, use Solo 401k and enjoy tax-deferred capital gains. Any real estate transaction processed under the name of Solo 401k account is eligible for tax-free growth if the capital gains find their way back to the account.

Not only this, you can even apply for a non-recourse loan to fund the real estate transaction. Non-recourse loans offer protection, as the property involved in the transaction serves as collateral and the lenders cannot come after the Solo 401k owner under defaulting circumstances.

In short, Solo 401k retirement plan offers real estate investments, tax-deferred gains, non-recourse loan, and a prosperous retired life. What else could a Realtor ask for!