Why depend on Uncle Sam to save you in your golden years, when you can make better use of the savings vehicles Congress gives you (and I ain't talkin' Social Security Reform, either)?
There is one little-known tidbit (that I originally wrote about back in 2005) called self-directed pensions that will allow you to leapfrog your retirement savings beyond the usual standard stock-and-bond offerings. Self-directed IRAs (both Roth and traditional), held at designated independent trustees’ offices, allow you to take advantage of a Congress- and IRS-approved law that allows you to invest your retirement money in real estate tax liens or deeds of trust, real estate options on land or residential rentals, discounted mortgages, land lease limited partnerships, and vacant land or lots.
The only things you CANNOT legally invest your IRA money in are:
--collectibles (wine, art, stamps, coins, cars, sports memorabilia, etc.)
--a business which you own more than 5%
--any investment where your IRA would be used as collateral for a loan (such as a mortgage).
If you buy real estate to keep (using your Roth IRA) through tax liens or deed sales, and hold the property for appreciation until retirement age, you can legally take “a house” as a distribution, making it a personal asset and no longer an IRA-held asset—and no taxes incurred until you sell (hopefully after two years to take advantage of new sales rules). Even those taxes can be forestalled with a property exchange or keeping the property proceeds under $250k for singles and $500k for couples.
If the real estate isn’t a keeper, then the property gets fixed up (using IRA money) and sold, with sales proceeds go directly back into the IRA account (through the trustee). The whole process gets repeated over and over—this is a way to make a $2k-$10k investment in someone’s back taxes and tax-forfeited property (through the trustee using your IRA money) into an $80k-$100k market-value investment in a short time.
If you wind up buying the tax note (lien) and the current property owner redeems it, you’ve at least made double-digit returns safely and quickly.
If you decide to use the funds from your traditional IRA to perform such maneuvers, taxes will be incurred the moment you take distribution of any money or property that comes from this IRA account.
It makes more sense to build up your Roth account and make it self-directed—more investing opportunity with less tax hassles later. You lose the traditional IRA deduction (up to $600), but make up for it with the Savings Credit (up to $2000).
With all this retirement fund opportunity available, who needs to rely on a Social Security check now, considering the shaky state of the system’s future, and the lousy options we're given to deal with it?
One last thought: can you imagine what this plan could yield when combined with the Stretch IRA method? If it’s legal (which I don’t know off hand), then it’s could make your heirs squintillionaires, depending on how long they were able to keep the machine going. If anyone has information about the legality of combining the Stretch IRA with the Alternative Investments method, please leave a comment.
Sunday, February 25, 2007
The One Untold Secret to Getting Rich
I was spurred into writing this by a blogger who said there WAS no secret to getting rich quickly. He was correct on one account—there is no way to do it QUICKLY.
There is a way to do it more rapidly than other methods, and that is to let go.
Let go of old, destructive, and/or expensive habits and hobbies. Let go of old ways of purchasing, acquiring, and procuring things. Let go of old and (now) useless possessions, unneeded space, ideals and values that prevent you from seeing opportunity, and old memories and feelings that keep you dwelling in the negative.
Let go of grand illusions that you’ve been laboring under, such as an over-inflated skill set or ability, because time is money after all. If you need to hire someone for a job, do it without fear or hesitation—an expert reduces error, time, and loss of use costs.
Let go of socially-driven expectations and DESIRE.
Clear out all those “someday” items, those “just in case” things, and the “you never know” stuff—it’s all taking up valuable real estate in your mind and on your property. Turn it into profit while getting rid of it, and continue turning a profit every time you avoid re-creating it. This applies to food, inanimate objects, energy use, taxes, and either seldom- or well-used spaces such as the garage, attic, storage shed, spare bedroom, etc. The sooner you learn and adapt to living a life of having what you use, and using what you have, all the once-spent extra ends up in the bank. Compound interest and market forces will take care of any invested profits for you, making your money grow even while you sleep.
Let go and let someone else__________ (fill in the blank). Your time and efforts are better spent creating more wealth for yourself.
The once untold secret is now out in the open for all to see.
There is a way to do it more rapidly than other methods, and that is to let go.
Let go of old, destructive, and/or expensive habits and hobbies. Let go of old ways of purchasing, acquiring, and procuring things. Let go of old and (now) useless possessions, unneeded space, ideals and values that prevent you from seeing opportunity, and old memories and feelings that keep you dwelling in the negative.
Let go of grand illusions that you’ve been laboring under, such as an over-inflated skill set or ability, because time is money after all. If you need to hire someone for a job, do it without fear or hesitation—an expert reduces error, time, and loss of use costs.
Let go of socially-driven expectations and DESIRE.
Clear out all those “someday” items, those “just in case” things, and the “you never know” stuff—it’s all taking up valuable real estate in your mind and on your property. Turn it into profit while getting rid of it, and continue turning a profit every time you avoid re-creating it. This applies to food, inanimate objects, energy use, taxes, and either seldom- or well-used spaces such as the garage, attic, storage shed, spare bedroom, etc. The sooner you learn and adapt to living a life of having what you use, and using what you have, all the once-spent extra ends up in the bank. Compound interest and market forces will take care of any invested profits for you, making your money grow even while you sleep.
Let go and let someone else__________ (fill in the blank). Your time and efforts are better spent creating more wealth for yourself.
The once untold secret is now out in the open for all to see.
Wednesday, February 14, 2007
War on the War on the Middle Class
The so-called “impoverished” middle class has elected Lou Dobbs as their spokesman by default. They’ve also elected to abdicate personal success and any hope of climbing out of their own traps unless someone else hands them a shovel or ladder.
This is much like the Iraq war. It's also much like the cry of the so-called "poor", only with a nicer appearance.
I was really taken aback by the recent CNN article that showed just how many people really believe that employers, the economy, and the world in general is out to sabotage them. The article itself was not the problem—the responses to it were.
According to most of the reader responses, future middle-class living standards will only be achieved if one were to increase their income to $100k or more, increase their level of education to master’s level or higher, or by political arm-bending to the left for more federal subsidization. Rarely did anyone address the need for possession and expectation re-assessment and re-alignment.
Yes, there are two ways to skin this particular cat, as I‘ve mentioned in previous articles:
1. Improve your lot at work through increasing personal workplace worth, increasing company worth, and increasing job pool worth, thereby increasing your possibilities for more income.
2. Determine what is really important to YOU, not society at large, by trimming possessions to what you can truly afford and what fits that personal “must have” list. By enlisting the help of frugal tactics, you can actually get those possessions at much lower-than-retail cost, as well as save lots of money on various household expenses. This will free up money for other important things like health insurance.
I’m confused about what exactly is “middle class”—is it a dollar figure, a lifestyle level, both, or none of the above? If good things are done with any amount of money, it can make you seem “more” than what you really are, especially to other people (whom aren’t doing so well).
I think the middle class is really a level of emotion about money, possessions, and how we feel about our place in economic society compared to others. I also think we spend way too much time focusing on what we DON’T have rather than what we DO have.
Here’s a weekend afternoon project for you: make a two-column list of things you have and don’t have. Take a good look at it, then decide if you really REALLY need all the things on either side of the list. After crossing off the castoffs, then sit and figure how you’re going to take care of what’s left—by improving your worth at work, by changing consumption patterns at home, both, or neither. I say “you” because you got yourself into this war, and the government’s not going to bail you out through public policies and institutions.
Find out what you can do for yourself to return home from the war on the middle class—yes, it takes personal effort, but that’s what success achievement is all about! You know the old saying about “success = 10% inspiration and 90% perspiration”, so go work up a sweat already!
If you look at this from a news event point of view, it’s just like the war in Iraq—the troops got sent out to do a job, and now everyone’s trying to call them back because the current outcome is less than anticipated. Workers also get sent out into the fray, and when they don’t like their individual outcomes, they themselves shout and protest to come back, leaving Uncle Sam to earn their badges for them through legislation (health care, minimum wage, etc.) As you can tell, dear Uncle is already paying for one war—how on earth is he going to pay for another?
If you aren’t properly equipped and trained for battle, you aren’t going to win—simple as that. Like military soldiers, you must acquire the tools, training, and courage to use them, as well as learn to stay lightly packed—otherwise, you WILL be left behind for the enemy (in this case, poverty). Equip and train yourself for the economic battle by increasing your personal armament of tools and training, using courage and stamina, and learning to “pack lightly” at home through re-assessment of possessions and desires. All Uncle Sam can do for you is throw you an MRE (meals ready-to-eat) in the form of public programs, and believe me, you’d rather eat your shoe with hot sauce.
Other related articles: Why Women Earn Less, A Flat World Math Formula, Utopia Crashes to Earth, Show Me the Money!, Road to Serfdom , Affordable Health Care on Every Corner, Labeling is Disabling to Us, and The Ape Diet.
This is much like the Iraq war. It's also much like the cry of the so-called "poor", only with a nicer appearance.
I was really taken aback by the recent CNN article that showed just how many people really believe that employers, the economy, and the world in general is out to sabotage them. The article itself was not the problem—the responses to it were.
According to most of the reader responses, future middle-class living standards will only be achieved if one were to increase their income to $100k or more, increase their level of education to master’s level or higher, or by political arm-bending to the left for more federal subsidization. Rarely did anyone address the need for possession and expectation re-assessment and re-alignment.
Yes, there are two ways to skin this particular cat, as I‘ve mentioned in previous articles:
1. Improve your lot at work through increasing personal workplace worth, increasing company worth, and increasing job pool worth, thereby increasing your possibilities for more income.
2. Determine what is really important to YOU, not society at large, by trimming possessions to what you can truly afford and what fits that personal “must have” list. By enlisting the help of frugal tactics, you can actually get those possessions at much lower-than-retail cost, as well as save lots of money on various household expenses. This will free up money for other important things like health insurance.
I’m confused about what exactly is “middle class”—is it a dollar figure, a lifestyle level, both, or none of the above? If good things are done with any amount of money, it can make you seem “more” than what you really are, especially to other people (whom aren’t doing so well).
I think the middle class is really a level of emotion about money, possessions, and how we feel about our place in economic society compared to others. I also think we spend way too much time focusing on what we DON’T have rather than what we DO have.
Here’s a weekend afternoon project for you: make a two-column list of things you have and don’t have. Take a good look at it, then decide if you really REALLY need all the things on either side of the list. After crossing off the castoffs, then sit and figure how you’re going to take care of what’s left—by improving your worth at work, by changing consumption patterns at home, both, or neither. I say “you” because you got yourself into this war, and the government’s not going to bail you out through public policies and institutions.
Find out what you can do for yourself to return home from the war on the middle class—yes, it takes personal effort, but that’s what success achievement is all about! You know the old saying about “success = 10% inspiration and 90% perspiration”, so go work up a sweat already!
If you look at this from a news event point of view, it’s just like the war in Iraq—the troops got sent out to do a job, and now everyone’s trying to call them back because the current outcome is less than anticipated. Workers also get sent out into the fray, and when they don’t like their individual outcomes, they themselves shout and protest to come back, leaving Uncle Sam to earn their badges for them through legislation (health care, minimum wage, etc.) As you can tell, dear Uncle is already paying for one war—how on earth is he going to pay for another?
If you aren’t properly equipped and trained for battle, you aren’t going to win—simple as that. Like military soldiers, you must acquire the tools, training, and courage to use them, as well as learn to stay lightly packed—otherwise, you WILL be left behind for the enemy (in this case, poverty). Equip and train yourself for the economic battle by increasing your personal armament of tools and training, using courage and stamina, and learning to “pack lightly” at home through re-assessment of possessions and desires. All Uncle Sam can do for you is throw you an MRE (meals ready-to-eat) in the form of public programs, and believe me, you’d rather eat your shoe with hot sauce.
Other related articles: Why Women Earn Less, A Flat World Math Formula, Utopia Crashes to Earth, Show Me the Money!, Road to Serfdom , Affordable Health Care on Every Corner, Labeling is Disabling to Us, and The Ape Diet.
Saturday, February 10, 2007
Beating Me to the Punch: The Ape Diet
My last major post included an announcement of an experiment I was going to undertake next month about "buying foods without a label" to see what happened health-wise. Well, it seems I no longer have to do that--someone over in England already conducted the experiment for me.
A group of researchers went on a 12-day "ape diet" (largely vegetarian) and lost pounds, LDL cholesterol, and blood pressure--all from consuming vegetables, fruits, nuts, honey, a few grains, and water. I believe fish was thrown in on Week 2.
Now that I can see what it should do in a matter of 12 days, I'm still going to embark on my version next month--a dairyless, nutless, grainless, but meat-including version to accommodate my food allergies. I've come to find that polyunsaturated fats do a wonderful job in bringing pain to life, so I'm going to avoid nuts in my version--besides, nuts are for squirrels, right? :)
A group of researchers went on a 12-day "ape diet" (largely vegetarian) and lost pounds, LDL cholesterol, and blood pressure--all from consuming vegetables, fruits, nuts, honey, a few grains, and water. I believe fish was thrown in on Week 2.
Now that I can see what it should do in a matter of 12 days, I'm still going to embark on my version next month--a dairyless, nutless, grainless, but meat-including version to accommodate my food allergies. I've come to find that polyunsaturated fats do a wonderful job in bringing pain to life, so I'm going to avoid nuts in my version--besides, nuts are for squirrels, right? :)
Tuesday, February 06, 2007
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