Why You SHOULD Buy Real Estate in Your IRA - THE TRUTH!

I am sick and tired of hearing about real estate investors going to a workshop to hear from a company or an individual that says you should never buy real estate in your ira. I'm sick of it. And here's the truth. Now, the title of this video is why you should buy real estate in your ira. But you know what? That's not the truth either. In fact, both extremes aren't true. No one should be told to buy real estate in their ira, and that's the only way to go. And no one should be told that you should never buy real estate in your ira. Both extremes are unfair and untrue. I'm going to break it down. Number one, balance. Balance is the key. And of course we know about balance and eating healthy and exercise in our emotional and spiritual life. But I'm also talking about finances, financial life, our financial landscape. We want to have balance in that. Anybody that's telling you don't buy real estate, you should just buy insurance, or you should be just doing real estate in your own name, or you should stay away from IRAs or 401ks entirely. Anybody that's telling you that it's one way or the highway is wrong. We want to find balance and it makes sense. Right? We want to have a financial landscape and a portfolio that has a variety of tools and strategies and investments. It makes sense. It makes sense in our soul. And again, we should watch out for anyone saying that there's one way to do it. But let's get specific. How about it? So let's go to the whiteboard and talk about the first topic that you're going to hear from the naysayers. That is depreciation is lost in an IRA or 401k. You don't want to put real estate in an IRA or 401k because you don't get any of the write offs. It doesn't matter. And let me explain why. Now, when I work with clients, we divide their lives into two sides. Many of you seen this before? You're putting your operations over here. Fine. We're not talking about that. We're talking about your asset side. And do I want you to have real estate in your own LLC that you own personally or 100% down here by your family trust and you've got your little structure and you're getting depreciation benefits and your LLC is here and you might have multiple rentals and all the write offs. Yes, I want you to do that. I'd love everybody to be looking for real estate strategies using 1031 exchanges down the road, if it works. Charitable remainder Trust. Do installment sales defer, taxes, get write offs? Yes, all the above. But does that mean that we just don't do it in our IRAs? No. Let's get our IRA here and put some real estate in that as well. And when they say oh well, you're going to lose the write offs, that's not the point. What's in your IRA anyway? If you've got financial investments in a index fund that's maybe even no load, or getting a 5 or 6 or 7% return, is that the best use of your IRA money? I don't think so. If you can do better with real estate irregardless of depreciation, why don't you put your best investments in your ira? That's what I'm getting at. The depreciation issue is irrelevant because you should be putting what you know best in your ira. And if that means real estate, even with or without depreciation, then put it in your ira. Now what's the real truth here is we peel away the onion. The real truth there is these same promoters that are talking about not self directing or putting real estate in your ira, they're saying you shouldn't even have an ira, right? That's really what they're saying. Because if you can get a 10 or 20% rate of return with or without depreciation, why not put it in your ira? Because when you start to ask them, well, what should I put in my ira? Well they say you shouldn't even have an IRA anyway because it's controlled by the government and there's some conspiracy theory and you're never going to have access to it and the government's going to take it away. Are you kidding me? Should we talk about Area 51 while we're at it? Guys, the government is trying to make IRAs and 401Ks better. Social Security is on a life support and we're all worried about that. Guys, do you seriously think that the government's just going to pull away IRAs entirely? If so, maybe move to another country? Because our government is not that crazy. And if you're planning your entire financial scheme on the conspiracy theory that the government's going to rip away your assets, then why are. What are you planning for? Seriously. You see my point? If you can get a great return in your IRA doing real estate irregardless of depreciation, then the real point is they don't want you to have an IRA at all. So why should I not have an IRA because the government is going to take it away with some conspiracy theory? I don't think so. Alright, the next point they're going to make is, is that, well, you're just delaying the inevitable. You're going to end up paying taxes anyway because it's an IRA or 401k. You may be even in a tax bracket or you're going to pay taxes someday. So you shouldn't even be doing this investment inside an IRA or 401k. You should be doing it in your own name because it's going to be a better long term investment. Okay, let me hold the phones. You're telling me that delaying taxes is a bad thing? That the time value of money, of tax deferral is a bad thing? I don't think so. And you go, oh yeah, but we're going to do 1031 exchanges on our LLCs, that's going to defer the same taxes. Really? You're going to hang your entire hat on the 1031 strategy? Did you see the GOP bill that's already working on making 1031s even more difficult to complete? And in every situation a 1031 fits you. This goes back to my first point. Balance, find balance. I want you doing real estate in 1031s, but I also want you to have some deferred taxable income down the road. Even if you do pay taxes on it later. You do. You know, I have clients that do ten 31s. I've been doing ten 31s for a year. Does everybody just end up living on rent forever? There's some people want to cash in on those rental properties down the road. Sure they do. And a CRT or charitable remainder trust doesn't work all the time. And I get it, you might die and then there's stepped up basis or you might even die with an IRA and there's income in respect of a decedent. Ird. That's right. I can talk turkey. I'm a cpa, I'm an attorney. But guys, when you do the research, when you peel away the onion here, if anybody's telling you that just having attached deferred vehicle doesn't make sense, then their whole plan doesn't make sense. Because you want balance, you want a little of everything. Alright, next can we bring up Roth? If you're going to tell me that delaying the tax for some future date is just bad news and you shouldn't be delaying the tax inevitably and I can do 1031 exchanges all day long really? Have you ever heard of the Roth IRA or the Roth 401K? Let's add that into the mix because with a Roth you're not going to have to pay the tax on that. So why don't we think about deferring more of our money into a Roth or a Roth 401K and as we, you may say, well you can't get enough money in there to make it happen. Guys, at our self directed IRA settlement that we've done three years in a row now this last summit we had multiple people in the room with 5 million dollar Roths, 5 million dollar Roth 401ks because they've been self directing in a Roth and are never going to pay tax on it. That's right. You can do it. You can start converting and chunking money over to a Roth and you're funding the Roth 401K with your S Corp. With a Solo 401K rolling in your old IRA money, doing your Roth conversions in here in a targeted format as well as buying insurance and as well as buying real estate in your own name and having balance. We want a little bit of all of this going on so that we can hedge against problems that could occur in our life. So let's talk about one of those problems. A potential lawsuit. Are we going to have all of our real estate out there hoping that a Wyoming LLC or a COPE entity is going to protect us? It's a strategy. I teach it, I do it. But it's not going to be a fail safe in every situation. There's only one asset that's protected from a lawsuit that only you can touch by the government or in a divorce and that's the IRA or the 401k completely asset protected. And if there's a texting and driving accident and all heck breaks loose in your life and there's a major lawsuit, why don't we want to OJ Simpsonize our IRAs and 401ks have this part of the equation? You mean Mark, I'm buying real estate getting a better rate of return than an index fund. I'm having balance with personal real estate and IRA real estate. And with that balance, if there's a lawsuit, this is completely protected while I could lose some of that personal real estate. Exactly. We're getting asset protection at the same time we're building wealth and diversification. This is where insurance plays into it. I'm not it. This is the point I'm trying to get at. And any of you look at my record, am I against insurance? No, I think cash valued universal life vul whole life insurance should be a part of your equation when you're financially ready for the right type of policy. Absolutely. But does this mean we just discount IRAs entirely and hyper focus on insurance? No. The same arguments out there. Some people are anti insurance everything real estate, anti real estate everything stock market anti this all this all. No. Guys, here's the theme of my point and I appreciate you putting up with my rant. This is almost a rant. I know it is and I'm sorry. I get so upset and frustrated by this. If anybody's charging you huge fees to push you in one direction only and is a huge naysayer of one entire scope of investing, I would get a second opinion. Be careful before you write that big check. Get a balanced approach to your financial freedom. What is your landscape? This is the theme of my new book, the Business Owner's Guide to Financial Freedom. What Wall street isn't telling you. This is a Wall street theme as well. Watch out for self directing guys. I'm not saying in summary that you should by buying real estate every day in your ira. I'm not saying that some of you, you have no business buying real estate at all. You hate it and you're not good at it. That's cool. But find a balance people. That's what I'm talking about. And get a second opinion. When people are charging you huge fees that you don't see anywhere else and they're staying and they're stating that you should be sticking with one mechanism or one structure, it doesn't make sense. It probably feels bad inside. That's for a reason. Because it's bad. Anyway guys, thanks for listening. Keep living the dream. Stay balanced and find your landscape, your path to financial freedom. Thanks so much for watching and if you found that helpful, please look in the description below. I've got links to my tax and legal library, my QuickBooks training videos, how to start a small business, 50, 60, 70 videos, some as long as 30 minutes, explaining more information on tax and legal strategies that will change your life. Also, if you'd like to subscribe to my newsletter or check out my social media links, please click here. 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