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Boomers-Bank
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Financial Intelligence for Real Estate Investing
http://blog.IRA-401k-RealEstate.com
Introduction …………………………………………………………………………………………….. 3
How to Use This Book ……………………………………………………………………………… 7
About the Author ……………………………………………………………………………………… 9
Chapter One: Finances Today …………………………………………………………………. 10
Chapter Two: Baby Boomers and the Debt Junkie Generation …………………….. 22
Chapter Three: Traditional Investments Strategies and Self-Directed Plans …… 31
Chapter Four: Establishing A Self-Directed IRA or 401(k) ……………………………. 43
Chapter Five: An Introduction to Real Estate Investment …………………………….. 48
Chapter Six: Investigating Your Investment Options ……………………………………. 64
Chapter Seven: Property Assessment Strategies: Can You Make A Profit? ……. 81
Chapter Eight: Benefits and Inflation …………………………………………………………. 87
Chapter Nine: The Power of Commercial Real Estate Investing ……………………. 90
Chapter Ten: Using IRA Money to Make A Real Estate Purchase…………………. 92
Chapter Eleven: Borrowing Money with Your IRA or 401(k) …………………………. 96
Chapter Twelve: How To Use Partnerships To Create Wealth ……………………… 99
Chapter Thirteen: Setting Up A Working Partnership Real Estate Investments 104
Chapter Fourteen: Financing Analysis Pointers for Investment Deals ………….. 107
Chapter Fifteen: NOI, DSCR, LTV, and the Cap Rate ……………………………….. 110
Chapter Sixteen: Real Estate Appraisals …………………………………………………. 114
Chapter Seventeen: Closing the Deal ……………………………………………………… 116
Chapter Eighteen: Owning and Developing Real Estate …………………………….. 127
Chapter Twenty: Advertising and Selling Your Property …………………………….. 134
Chapter Twenty-One: A Secured Financial Future ……………………………………. 139
Glossary ……………………………………………………………………………………………… 141
Further Resources ……………………………………………………………………………….. 156
Appendix …………………………………………………………………………………………….. 159
Sample Program BrochureSample Subscription Agreement ……………………. 160
Sample Subscription Agreement …………………………………………………………. 161
Sample Private Placement Form …………………………………………………………. 162
Sample Approval FormSample Investor Update ……………………………………. 163
Sample Investor Update …………………………………………………………………….. 164
ll rights reserved. No part of the contents of this book may be reproduced or transmitted in any form
or by any means without the written permission of the publisher.
The example companies, organizations, products, domain names, e-mail addresses, logos, people, places,
and events depicted herein are fictitious. No association with any real company, organization, product,
domain name, e-mail address, logo, person, place, or event is intended or should be inferred.
A
Boomers-Bank
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Financial Intelligence for Real Estate Investing
http://blog.IRA-401k-RealEstate.com
Introduction
Why invest in real estate using your retirement plan? In this book, we’re going to
discuss several concepts for buying real estate using IRAs and 401(k)s; the socalled
nontraditional investments.
Let’s start by asking what advantage is there to all of this? Why not just let your
IRAs and 401(k)s sit around and do whatever it is they’ve always done? Well,
you can secure tax-deferred or tax-free income for one thing. Anytime you have a
profit or a gain, either you are not paying taxes on the gains until you start using
the money, or if it is in a ROTH IRA, you aren’t paying taxes at all.
By having real estate in a retirement plan, you are also avoiding what’s known as
capital gains every time you sell property. Your money is allowed to accumulate
and your interest will compound. Moreover, you can put all of the money back
into your next deal. However, you’ve got to bear in mind the current state of the
economy. Money doesn’t just sit around these days. In most parts of the world,
the dollar is losing value at a pretty alarming rate. The United States is a country
at the edge of a financial and economic precipice, owing trillions of dollars to
other countries and borrowing money against, well, the value of its existing
borrowed money (we’ll talk about this later).
The infrastructure of the United States is at present rather unorganized. We
aren’t producing much and so we’re importing more than we’re exporting. It’s
basic mathematics. Notice how the prices of food and gas have been rising
recently. That should give you a pretty clear idea of what’s going on and what is
likely to continue to happen (we’ll also talk about this a little later on).
The main focus of this book, however, is to demonstrate the value of
nontraditional investment choices for 401Ks. Our goal is not only to introduce you
to the reasons why these choices are advantageous, but it is also to explain the
particulars of the related processes. For the sake of helping you confront your
financial advisor or accountant, we’ll discuss the various strategies for
undertaking this type of investment. We also plan to take you through the
processes for finding appropriate real estate to undertake the actual investment.
Since the property market can be a bit difficult to navigate, particularly if you’re a
beginner, we’ll allow you to benefit from our wealth of experience and wisdom on
the subject.
However, before we go any further, as a continuation of this introduction to the
book and its content, let’s talk about two concepts you will need to understand to
get a handle on the investment advice we’re giving you.
We need to establish
Boomers-Bank
Johnkrol@ira-401k-RealEstate.com