jump to navigation

The Most Elusive & Dangerous Self-Directed IRA Practice – Part 2 November 16, 2010

Posted by Jeff Nabers in : Business Start-Ups, Money, Personal Enjoyment, Personal Productivity, real estate, Self Directed IRA Solo 401k, Small Business Lending , 7comments

In the last post, you learned about how doing an active “entrepreneurship-ish” deal inside your IRA is an open invitation for the IRS to tax the hell out of you.

In this post, you’ll learn the solution.

The solution is to structure both your active entrepreneurship and your passive investment activity in a way that that puts you in the most control. Put another way, avoid giving the IRS an open invitation to tax attack you.

I bet you can guess where this is going (one commenter had a pretty good (more…)

The Most Elusive & Dangerous Self-Directed IRA Practice November 14, 2010

Posted by Jeff Nabers in : Business Start-Ups, Personal Enjoyment, real estate, Self Directed IRA Solo 401k , 11comments

There’s something that most “successful” Self-Directed IRA investors do that can spin them out of control and get them into trouble.

I say “successful” in quotation marks because I’m talking about the particular kind of Self-Directed IRA success that is sexy enough to be frequently written about.

What is this dirty deed that leads to massive profits and the potential implosion the very same Self-Directed IRA that got those profits?

Entrepreneurship.

Bad Entrepreneur!

Yep. Entrepreneurship is so powerful that it seems to be the source of all aggressive wealth creation. So where’s the danger?

Let me explain. Some of the most [initially] profitable Self-Directed IRA stories sounds something like this…

Joe, a Self-Directed IRA investor, knows how to work real estate deals into profits. So he buys and sells real estate in his Self-Directed IRA. Sometimes he involves bank financing. Sometimes he involves private financing and partnering.

But one thing is for sure: Once Joe purchases a property, the work has just begun. He has a system. He only buys properties that meet a certain criteria. After the closing, he usually has repairs and/or remodeling work done.

And his system works. He’ll put $30k or $40k of his Self-Directed IRA money into a deal and get $80k to $100k out, often less than a year or two later.

First, applaud Joe for (more…)

The Hidden Meaning Behind the State of the Union Address January 29, 2010

Posted by Jeff Nabers in : Hyperinflation , 4comments

I just started watching the State of the Union address on Youtube and was immediately sickened.

I guess I should tell you that I’ve been physically ill since last weekend, but Obama’s speech isn’t helping. It was way too reminiscent of the scenes in the book (or movie) 1984 where the public is forced to participate in mass hate and love demonstrations for their enemies and leaders.

The Painter Announces He Will Install the Plumbing

The first thing that blows my mind about what was spoken on the topic of economics is the absolute retardation of reason. Nobody in the government knows anything about economics. Time and time again, they make predictions and statements that turn out to be completely wrong. These people (Congress, the President, and other bureaucrats) are not economists (and they only acknowledge the economists who support the philosophy of never-ending increases in government spending and power).

They are not the bringers of solutions. If our problems went away, then they’d lose their jobs because we’d have no need for them. They are problem-creators. They are hired to fail.

We are expected to celebrate an announcement that the stimulus worked? Hey didn’t the last President announce (more…)

The Next Generation of Small Business Funding September 1, 2009

Posted by Jeff Nabers in : Money, Personal Enjoyment, Personal Productivity , 13comments

vc

Each year entrepreneurs pitch Venture Capital firms in hopes that their startup company or business expansion will get funded by them. The vast majority do not get funded. Furthermore, “getting funding” almost always means the entrepreneur must sell a sizable piece of his company to the VC.

Getting funded by a VC is a dream, but it can easily turn into a nightmare for both the entrepreneur and the VC. Because the VC owns a piece of the company, if further rounds of funding are needed in the future it could mean diluting only the founder’s ownership, depending on how the contracts were setup. It’s not too uncommon for founders to eventually wind up with a minority stake in their own company and to lose control of it. For the VC, there’s a big chance of failure. They usually need an exit strategy, such as taking the company public to sell its shares to the marketplace or to sell the company to a private party. But before they sell it, they need to try to juice up the revenue of the company to max out the sales price. When maxing out revenue becomes the primary unconditional focus, it’s easy for the business to go in a very different direction than the founder had intended.

The above horrors can happen when an entrepreneur does get funding. Let’s not forget that most entrepreneurs seeking capital just don’t get funded.

These are problems. And yet the world has a way about finding solutions to problems and getting them to those who can benefit. Sometimes the solution can be so incredibly simple that it’s hard to believe. In the case of funding a small business, the solution I see is a matter of (more…)