Holding International Real Estate in your IRA

Posted on April 1, 2012 by Mark

What is your idea of the perfect second home?

Is it a secluded mountain hideaway? A cabin on a lake? A casita on the beach in a tropical paradise? Now, did you know you can hold this second home or vacation home in your IRA? Yes, it’s true. While the US tax code certainly restricts certain types of assets which can be held in an IRA, real estate is allowed.

Of course, you’ll never hear about this little known loophole from your broker. He only earns a commission if he sells you stocks or bonds.

There are many distinct advantages to holding real estate in your self-directed IRA or 401(k). You’ll have the ability to:
Purchase both traditional investments (stocks, bonds, etc.) and non-traditional assets such as real estate and mortgage notes
Transfer funds from your current IRA or another qualified plan to purchase real estate without taking a taxable distribution or incurring penalties
Buy and sell commercial, residential, raw land, and rental properties as real estate IRA investments
Acquire rental properties as an IRA investment and be your own property manager, saving money in upkeep and management expenses
Save thousands of dollars by avoiding the transaction, holding, or asset-based fees associated with many traditional holdings and generally assessed by an IRA custodian.

Now, here’s where it gets very interesting…

The real property you hold in your IRA does not have to be in the United States. You read that correctly, you can hold foreign land in your IRA. Just imagine buying your dream retirement home NOW, at today’s prices, and having it waiting for you (and greatly appreciated in value) when you are ready to retire!

You would have access to your property to vacation whenever, and as often as you like, You could rent it out and generate an income.

Unfortunately, if you are like most people, your current IRA has experienced unprecedented volatility this past decade and still has not yet fully recovered from the crash in 2001 and 2008. A self-directed IRA can help you diversify outside of the stock market and into potentially more secure and lucrative investments.

While the value of US real estate has fallen 30%, 50%, or more in most areas, there are many popular foreign destinations where prices have held steady and even increased in value.

Just think of where you’d be if your IRA had steadily increased in value over the past decade. A self-directed real estate IRA may be just what you need to escape the lackluster returns of the US stock market. It gives you complete control over where, when, and how your IRA is invested!

The first step is to check with your trusted financial advisor to see if this may work for you and your unique situation. Then find a trusted custodian who is knowledgeable in holding real estate in your IRA or 401(k).

We hope you found this little known secret valuable. We’re wishing you success in your efforts to build wealth in your IRA.

Feel Free to contact us for help getting in direct contact with developers in Central America offering some of the most breathtaking properties available today!

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Lower Mortgage Rates, Higher Debt

Posted on February 29, 2012 by Mark

Recently, Canadian banks had been offering lower mortgage rates (2.99%). And for many a potential home buyer this was a great opportunity to achieve a home at a more affordable rate; furthermore, for those who were surviving at a higher interest rate on their home, this was an excellent opportunity to bring down their monthly payments and have more money in their pockets each month. For many, this was a good thing, but for far many more this was a financial trap!

As stated in one of our earlier posts, your house is not your greatest investment – it is one of your greatest expenses! Houses accumulate a lot of expense each and every month – bills, upkeep, decorating, renovations, etc. And this is above and beyond the mortgage.

Mortgage are designed that the holder pays off the (compound) interest first. This means that the first number of years (maybe even decades) of payments has not even gone towards your home’s equity, but towards the extra money that is owed to the bank for the luxury of borrowing their funds.

Factoring it all in together, and the actual ‘value’ of one’s home is nowhere near what the home-owner often believes it should be!

Lower mortgage rates in the minds of many means that they can afford a larger house for the same payment each month as the originally chosen size or location.  While this may be true, it is very dangerous thinking! Being able to afford more for the same monthly payments does not always work out for the best for the mortgage holder. It is still more debt. And with a bigger house comes more expenses each month.

One final note on mortgage: Take the time to do the math when arranging for a mortgage and find out just how much the house will actually cost when the final cheque is sent off to the bank and you can finally collapse into your rocking chair with your great-grandchild in hand. You might be surprised to realize that that once affordable larger house is now nearly twice the cost as originally believed to be.

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Speaking Their Love Language

Posted on February 14, 2012 by Mark

About ten years ago a friend of mine introduced me to Dr. Chapman’s Book, ‘The Five Love Languages’. And in the spirit of Valentine’s Day, I felt it sensible to share the concepts briefly.

The beauty of the five love languages is that it is not just for understanding your own needs, but more so that the other person’s needs are able to be expressed and addressed in an understandable and approachable manner. These five love languages are designed for everyone to be able to work with and grow through.

In no particular order, the first love language is ‘Quality time’. For this person, spending devoted quality time is the most valuable form of love they can receive. Note the word ‘devoted’ in the last sentence; quality time is about separating ones self from other distractions in order to be able to focus on your loved one without unnecessary interruption – cell phone, work, friends, etc.. Quality time can be something as simple as washing the dishes together, all the way to getting away on a romantic vacation in Europe, and everything in between.

The second is ‘Words of Affirmation’. For this person, spoken words of praise, love, and appreciation are the most valuable forms of love they can receive. Words of Affirmation is the verbal recognition and declaration of the things they have done, their accomplishments, and your love for them. Words of affirmation can be something as simple as recognizing their making and bringing you a morning cup of coffee as an act of love and thanking them for it, to flat-out saying that you love them.

The third is ‘Acts of Service’. For this person, actions speak loudest. Acts of Service is physically doing things that you know will tell your loved one that you did that to show them you love them. Acts of Service can be something as simple as making the bed in the morning, or taking out the trash, to preparing a romantic meal and doing all the clean-up afterwards.

The fourth is ‘Gift Giving’. For this person, going out and buying a small (or large) something, or making something for them expresses your love for them the loudest. Gift Giving can range from buying them their favorite coffee in the morning to expensive jewelery.

The fifth and final love language is ‘Physical Touch’. For this person, your touch is the most important way that they can recognize your love for them. Physical Touch can range from something as innocent or simple as you brushing your hand up against theirs or playing ‘footsies’ under the table, to the actual act of love making.

The important thing to remember is that these love languages are designed for the other person to be able to recognize and receive your love for them. We all naturally speak in our own love language. Take the time to sit down and communicate with your loved one which ways they recognize and receive love the best.

Furthermore, within each of these love languages, each person’s individual requests are unique.  Take my father for example. My mother will often hide a small chocolate bar in his desk with a small note telling my father that she loves him. To my father, that simple act speaks louder than a thousand hugs or a luxury cruise. Learning about these kinds of ways of receiving love is a journey for the two of you.

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How do you Gauge your Worth?

Posted on February 7, 2012 by Mark

Time and time again I’ll get into a discussion with one of my friends on how I don’t actually have a ‘real job’, or how if I’m supposed to be so wealthy, then why don’t I live in a mansion, etc., etc.. At first it used to bother me of why they’re being like this. Time passed and several light bulbs went off in my head.

One of these realizations is that they are trying to compare my source/kind of income and the way I earn it with theirs. Most of the people in the world are not wealthy. This is an indisputable fact. And of those non-wealthy people, most of them have what they lovingly refer to as ‘a real job’. Of the few wealthy people in this world, I would believe that practically none of them would fall into the ‘real job’ category.

Simply put, the poor exchange their time for what they refer to as ‘a steady income’. It’s safe, constant, and… meager. They believe that they want to be comfortable, and that’s good enough. At least… that’s what they try telling themselves to compensate for their lack of abundance.

The wealthy, on the other hand, exchange their results for income. This is the ultimate of divides. I have set my personal ‘value’ quite high, and so I work accordingly – earning my results, and, in turn, my income. I believe that I am never earning enough in accordance to the results achieved, so I continue to strive towards my perceived value.

What do you desire in life? To be safe and not wealthy? Or to be earning what you are worth?

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Your Hidden Wealth

Posted on January 27, 2012 by Mark

A friend of mine called me today and asked to see if it were possible for him to help him prepare for retirement. As we were going through his finances and recreating his budget, it turned out that he was essentially wasting about $1000 a month! After restructuring the entirety of his finances, we were then able to set up a separate account for him to deposit the extra funds into and begin creating a fantastic investment nest egg.

He’s decided to invest in some of our hotel options. I told him that based on his numbers, in about 5 years of this system he will have a monthly residual income generating more than enough to retire on. With that news, I could hear the excitement over the phone! Suddenly he began going back over his budget seeing where else he could scrape and redirect funds into his new account so that he could have even more to invest each year.

I considered how it was amazing for a person in his late 30′s to just begin preparing for retirement and yet through proper investment in cash-flow products be able to retire in just five short years! If only everyone were willing to put their pride aside and live without some of the foolish spending that far too many of us have grown accustomed to as a part of our daily lives, justifying it as ‘necessities’.

My friend has a goal and the desire to make it happen. Wise investing, determination and a bit of humility is all it takes to turn an average Joe into an overnight (mental) millionaire! His goal was to retire before the age of 50, and now that goal will be beaten by five years!

What’s your goal? How are you planning on making it happen?

 

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Table Talk

Posted on January 26, 2012 by Mark

Growing up right from primary school straight through to college and university, my favorite courses were the business ones offered through the public education system of Canada. Well, they would have been had they been offered. The sad truth of the matter is that these courses are not offered, and if they are they begin being taught when it’s very late in a young adult’s life!

While most of us learned our financial understanding from our parents or life experiences, the truth is that most of us were not adequately prepared to take on the slings and arrows of life. Thrown to the wolves is an accurate description of how the majority of us end up once ready for the workforce. We should have been learning all along, even if what not to do, from our parents and other family friends.

Dinner is still one of the last actual family moments left on a lifeline in American families, and thus the best time to communicate and take the time to teach our children how to be prepared for finances and business. Ask yourself, how much do my children know about investing? Passive incomes? Ways to reduce taxes? The benefits of having one’s own company? Why it’s important to reinvest profits? These are all important items of knowledge to assist your child to become a part of the next generation of millionaires!

And if you don’t know about this? LEARN! Read a few books. Go to some seminars. Research! Unless you desire for your children to suffer the same financial fate as you…

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Belize (Investment) Property Sale!!

Posted on January 24, 2012 by Mark

Starting today, at the golf course of one of our Belize partners, is a sale going on for both investment and purchase properties! All properties are waterfront, and have access straight out to the Caribbean Sea.

An example property on sale is one with a current market value of $150K (USD) going for $60,000!!

Contact us for more information, and we will have the developer contact you directly!

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Marital Growth

Posted on January 22, 2012 by Mark

Alike a good investment, a marriage has the hope/promise of growth. Growth in this case, however, is more along the lines of a child growing into an adult. There are numerous stages, bumps and bruises along the way, but each stage is there to assist, not deter.

For many marriages they begin as the merging of two great streams of water. Separately they are peaceful and calm. The slow trickles of peace in knowing that they are in complete control of the direction of their existence flows along the course of direction is reassuring and encouraging. Making difficult decisions for one person can be exciting and a courageous endeavor.  Uniting those two tranquil rivers can cause for unexpected rapids! Each stream fighting for its place in the newly conjoined system. Decision making for two (or three, four) can be stressful and daunting, especially if it is a major, life-changing decision. This is the time where the river is often the shallowest.

The hope and good news is that after the rapids of unity come the time of conformity where the two streams learn to work well with each other as they become one.  This is the initial and greatest time of growth. Through this time couples learn to love each other’s flaws and strengths. The streams begin to merge and mingle as one, sometimes countering obstacles with trepidation, but through perseverance, overcoming the minor bumps and thumps of life together. At this time the rivers may get deeper and start flowing stronger, but with a calmer demeanour.

Finally there is the final stage of marital growth: the calming of the waters. This is where the two rivers have fully joined as one, and flow with grace. Deep waters, strong and united.  Growth is continually happening, especially with the addition of smaller brooks adding to the majesty of this family of united waters.

No, not all marriages turn out this way; it takes work and effort, but it is worth the adventure and journey!

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The ‘Trapped-Fly’ Businessperson

Posted on January 21, 2012 by Mark

No one ever said that working in the field of sales, or being a success in business was ever an easy thing. The truth of the matter is that nothing in life that comes easily is worth it. A trophy given for simply ‘being’ is nowhere near as valuable as a trophy earned through hard work and dedication. However, for many who strive to earn that trophy – whatever it may be – not all will find the finish line. But this is not always a bad thing.

Achieving a goal is sometimes worth an abandoned dream or two, even if the goal itself is in need of a few modifications. Consider the fly in the room. Its goal is to get out of the room and into the outdoors. But try as it might, that invisible barrier we humans like to call ‘a window’ mystically thwarts all efforts, desires and intentions of the fly. In spite of constant failure, the fly has but one goal and thus pursues it with greater and greater vigor. If only that fly would stop for a moment, take stock of its situation, and maybe refocus its goal, it would note that there was a door open leading to another room, maybe a room with an open window. But the fly has only one ‘business plan’ in mind: “Try harder.”

Many of us are like that fly. When a problem arises, instead of stopping to take stock of one’s situation, the bull-headed approach of ‘try harder’ is ground deeper into the psyche.

Take the time, when a stumbling block gets in your way, to lift up your head and take a look around. Opportunities may be available that you never knew about if you had not.

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Inter-Generational ‘Wealth’

Posted on January 20, 2012 by Mark

“A good man leaves an inheritance for his children’s children.” ~ Solomon

What are you leaving behind for your children and the generations to follow? An old china hutch full of pretty things? A house? Maybe even a few stocks and bonds? Debt? Or have you been preparing for your children and their children’s futures?

And while there are many different forms of investments which deal with this sort of issue and provide a means in which to ensure your future generations will be cared for, this post is about none of those.

How do we wish to be remembered when we’re gone? Furthermore, how do we wish for our children to be perceived in society? What kind of a family ‘name’ are you setting not only for yourself, but also for those who come after you?

Wisdom is not necessarily something that comes naturally for most people. It must be sought after. However, in the case of one’s children, wisdom is something that not only should, but ought to be passed down from generation to generation. And while society does have certain expectations which each and every parent is charged with bestowing upon their children in the terms of civil manners and whatnot, the wisdom which is passed from generation to generation is far more than teaching a child their manners.

Later on this week I will be writing about talking business at the table and sharing with one’s children was in which to be successful. With those dining conversations also come the passing on of business ethics. For some, the learning of business ethics only happens in College or university, or worst yet, not at all. Business ethics is of paramount when dealing with the affluent, as they are none to be trifled with! Teaching these things to a child when they are young is an excellent way to ensure that as they grow older they will likely adhere to your teachings and grow to be the son or daughter of whom you can be proud.

Character is another kind of inter-generational inheritance. But beware, that word is alike the word ‘quality’ – there’s high (good) and there’s poor. What kind of character traits are you embedding in the minds of your offspring? Are you preparing them to be pillars of society, or the dreg ?

And so I ask again, what are you leaving behind for your children and the generations to follow?

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