INVESTING IN YOUR IRA
Did you know that you can invest your qualified IRA and 401k retirement plans into Real Estate, Hard Money
Lending (Notes) and other investment opportunities?
Most people invest their money with a financial advisor who tells them exactly what to invest their money into.
This is great, but these advisors will educate people on their products and will advise them to invest into the
things their companies typically offer. They do not offer much education on opportunities that do not benefit
them. This is understandable, but it doesn’t give you the entire picture.
Here is the reader’s digest version and if you would like to learn more then you may contact us. The tax laws
only allow a person to invest a certain amount of money into their retirement plan each year, generally
$5,000.00 per year. However there is no tax law that prohibits how much money your retirement account can
earn each year from its investments. This is a key factor in this strategy. The whole point of this strategy is that
everything you earn is tax deferred until such time as you are required to take money out and pay taxes. This
means that all of the taxes that you would normally pay on a gain stays in the account and can be reinvested
(deferred). The hope is that the additional money that the retirement fund will gain by having the additional
dollars to invest, will far offset the taxes that may be paid later.
Here are some examples of investments that can be made through a retirement account:
1) Purchased real estate for Cash. There are essentially two ways to purchase real estate with your
retirement account. The first way is to purchase the property outright. Let’s say you found a 3 bedroom 2 bath
home that could be purchased in Jackson, MS. for $30,000. The property needs new AC, paint and carpet so
let’s say that equates to $10,000 in repairs. The IRA account could purchase and take title to the property.
The IRA account could also fund the renovations. Let’s say that the IRA did that and there was $40,000
invested into this property (with closing costs) from the IRA. Now let’s say this property has a value of $80,000
and it will rent for $850/month. The property is leased. Every month the rent goes directly into the IRA account.
The IRA account also pays the insurance and taxes each year. Here is some math:
a. $40,000 invested directly from the IRA
b. Taxes and Insurance are $1600 per year payable yearly from the IRA
c. Net rents per year after management (10%), taxes and insurance- $7,580
d. This is almost a 19% annual return while leased
e. Plus the current equity in the home
f. Plus the annual appreciation that is gained
Two years later you sell the property and net a profit of $15,000 after expenses and that money also goes
directly into your IRA account. Therefore you had a total return on this property of about 37% annually. In
addition you put the $40,000 original principle back into the IRA with no current taxes due-! Not bad.
Irvine Hills, LLC has properties currently available that can be purchased in your IRA with comparable returns.
2) Become a Hard Money Lender- Make a short term, high interest rate, low LTV loan to investors who are
buying property and cashing out within 6 months of the purchase. Returns are 10% annually. You get checks
every month and if they don’t pay then you can take the real estate asset back from them. This will go directly
into the retirement account. Imagine how quickly you will double your retirement. Investors will get a first deed
of trust as security and be named as additional insured. The key factor is getting into the right properties with
the right borrowers. Irvine Hills, LLC is such a borrower with a proven track record in renovating and selling
properties
Did you know that you can invest your qualified IRA and 401k retirement plans into Real Estate, Hard Money
Lending (Notes) and other investment opportunities?
Most people invest their money with a financial advisor who tells them exactly what to invest their money into.
This is great, but these advisors will educate people on their products and will advise them to invest into the
things their companies typically offer. They do not offer much education on opportunities that do not benefit
them. This is understandable, but it doesn’t give you the entire picture.
Here is the reader’s digest version and if you would like to learn more then you may contact us. The tax laws
only allow a person to invest a certain amount of money into their retirement plan each year, generally
$5,000.00 per year. However there is no tax law that prohibits how much money your retirement account can
earn each year from its investments. This is a key factor in this strategy. The whole point of this strategy is that
everything you earn is tax deferred until such time as you are required to take money out and pay taxes. This
means that all of the taxes that you would normally pay on a gain stays in the account and can be reinvested
(deferred). The hope is that the additional money that the retirement fund will gain by having the additional
dollars to invest, will far offset the taxes that may be paid later.
Here are some examples of investments that can be made through a retirement account:
1) Purchased real estate for Cash. There are essentially two ways to purchase real estate with your
retirement account. The first way is to purchase the property outright. Let’s say you found a 3 bedroom 2 bath
home that could be purchased in Jackson, MS. for $30,000. The property needs new AC, paint and carpet so
let’s say that equates to $10,000 in repairs. The IRA account could purchase and take title to the property.
The IRA account could also fund the renovations. Let’s say that the IRA did that and there was $40,000
invested into this property (with closing costs) from the IRA. Now let’s say this property has a value of $80,000
and it will rent for $850/month. The property is leased. Every month the rent goes directly into the IRA account.
The IRA account also pays the insurance and taxes each year. Here is some math:
a. $40,000 invested directly from the IRA
b. Taxes and Insurance are $1600 per year payable yearly from the IRA
c. Net rents per year after management (10%), taxes and insurance- $7,580
d. This is almost a 19% annual return while leased
e. Plus the current equity in the home
f. Plus the annual appreciation that is gained
Two years later you sell the property and net a profit of $15,000 after expenses and that money also goes
directly into your IRA account. Therefore you had a total return on this property of about 37% annually. In
addition you put the $40,000 original principle back into the IRA with no current taxes due-! Not bad.
Irvine Hills, LLC has properties currently available that can be purchased in your IRA with comparable returns.
2) Become a Hard Money Lender- Make a short term, high interest rate, low LTV loan to investors who are
buying property and cashing out within 6 months of the purchase. Returns are 10% annually. You get checks
every month and if they don’t pay then you can take the real estate asset back from them. This will go directly
into the retirement account. Imagine how quickly you will double your retirement. Investors will get a first deed
of trust as security and be named as additional insured. The key factor is getting into the right properties with
the right borrowers. Irvine Hills, LLC is such a borrower with a proven track record in renovating and selling
properties
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posiive cash flow properties
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