Give or take, regular folks lost in the range of 37-45% of what they’d built up in their Qualified Plans — IRA’s and 401’s. One wonders how many thousands of retirement dates have either been postponed or simply cancelled ’till further notice? Most aren’t aware of the option on their menu allowing them to take control of their Plans.
It’s a matter of some mildly irritating paperwork to convert your IRA/401(k) into what’s known as a ‘Self-Directed’ entity. As that title implies, you would be in charge of where your capital is invested. You would be subject to what’s known as a Custodian, but they’re there simply to keep you between the lines so to speak.
Bottom line?
You have the opportunity to begin recouping your losses in a systematic ‘big picture’ way. You can direct your plan to acquire a rental home which will be located in a proven growth region. It will produce steady cash flow, and grow in value over time. It’ll require a 30-35% down payment, which is a very conservative approach.
If it only appreciates 2% annually, it means your invested capital will have been growing at a 6% annual rate as a direct positive result of leverage. Also, the cash flow will be relatively reliable year in and year out. Then there’s the long term principal pay down of the loan balance accruing to the increase in equity — your equity.
Do you know of a stock generating 2-5% ‘dividends’ every year? Or growing your capital at 6% annually? No? Didn’t think so.
The key question is where should this real estate be located? I can give you solid suggestions. Call me at 619 889-7100. Have a good one.
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