All Forum Posts by: Jeff Barnes

Although @Dmitriy Fomichenko works for another company and all, I still have to agree with him . :-D 

In my opinion the best option is definitely the Solo 401k. Eliminate the custodian, act as your own trustee, have check book control and direct access to your money, and truly own your financial future! It's a strategy I think could set a smart, driven, and empowered individual free and allow them great autonomy in their investing.

Best of luck in whatever you choose, @Lynn Burks  !

I vote solo k as well. Up to you how much control you want and how much you want to pay. The most important thing to have is a good team that will help you set everything up and make sure you don't violate the IRS guidelines. If you are just getting started, then definitely get good advisors to help you out. Contributions are great for tax benefits, but control is more important if you want to roll over and start investing right away.

Francis A. I just held a webinar on this last night and talked about some of the best uses for a solo k. The biggest questions you need to get answered from whoever sets it up for you: 1. Do they create the trust documents as well? A 401k is held in a trust, so you actually need to trust set up before you can start everything. 2. How many clients have they worked with in the past? 3. What education and support do they provide after you're all set up? 4. Will you get access to a regular bank account with your trust, or do you have to use them (ie Chase Bank, credit union, etc.)? All that being said, since I set these up, I am somewhat biased to who you would use. :-) However, there are plenty of great resources here on BP, so just scope them out before you get started.

A few things here: First, if you do get a loan, then absolutely do NOT sign a personal guarantee. That will invalidate the whole deal. Next, if you have a Solo K, then you could roll your traditional IRA money into that and maybe get the deal done. If you have a regular 401k, why not just borrow the $$ from your 401k? Assuming there's at least $20k in there and your 401k has a loan provision, that might be easiest. Lastly, there are always private lenders. If the deal is good enough, then just reach out to your warm list and see if anyone's interested in partnering with you. Personally, I would stay away from getting a loan from a bank at all costs.

I am seeking out success stories. Specifically, I want to know how you have used your self-directed IRA or 401(k) or any other type of retirement plan to invest in real estate and how that is worked out for you.

Have you invested in fix and flip properties? What about commercial, apartment, or multifamily properties? How many deals have you completed using your self-directed retirement plan?

Or, alternatively, have you used someone else's retirement plan to fund your deals?

I really want to know what kind of success stories, as well as failures people have endured using their self-directed retirement plans to invest in real estate.

If you don't want to post your responses online, please go ahead and private message me with your response, and I can contact you off-line.

Please be as specific as you can so that others and myself no how you and many other people have used retirement plans to fund real estate transactions, and what kind of profit or loss they have endured or experienced as a result. Many people have a lot of horror stories around using self-directed retirement plans, and I want to capture those as well if I can.

Correct.

I will be hosting a free webinar this Friday to discuss the "Ultimate Real Estate Retirement Account!" This is going to be an interactive training where I go through the in-depth and advanced strategies of how you can use a self-directed retirement plan to purchase, fund, and otherwise invest in real estate using tax-free and tax-deferred strategies.

I have several clients who are already using many of these strategies, and I want to give you an opportunity to hear how some of these strategies are working out right now for investors just like you.

Be sure to register today even if you aren't going to be able to make it on the live call because we will post the replay for anyone who is registered. I look forward to working with you soon!

Register Now!

I agree with Loren. You're basically trying to get around the rules of having a retirement plan. One other option that might be harder to contest is if each of you have separate businesses and the loans were made to the businesses. As long as the money is used for biz purposes, it would be hard to contest the arrangement. However, why not roll your money into a 401k (assuming it's a traditional IRA, not Roth), and then take a loan out? You can get up to $50k or 50%, whichever is less in a loan that you can repay over five years. This would eliminate any chance of losing all your money to fines, fees, and taxes.

If you turn him into a W2 employee, then you will no longer have a "solo" 401(k). All the benefits of a solo k go out the window when you hire employees even if it is your brother. Only your spouse can have the same solo k as you without disqualifying it as a solo k.

Since I can't vote on my own post, I'm going to vote on Loren's! :-)