Longboat Retirement Solutions LLC

What Does a Trump Presidency Mean to Your Retirement Savings? February 22, 2017

How will the Donald Trump Presidency affect your retirement?

If you believe the big media outlets, he is going to steal your wallet and your retirement account.

I doubt that this is the case. But, how would I know?

While we are certainly overdue for a market correction in the U.S., the timing of a correction is of course the million dollar question.

I’ve said this before, but I’ll say it again; I am not in the business of predicting the stock market. I am in the business of helping people diversify their retirement savings through the set up of self directed retirement accounts.

In other words, it should not matter what the U.S. stock market does. My clients have the flexibility to move in and out of the market when ever they choose. Or, if they choose to have zero dollars in the stock market, they can do that too. If they choose to pull out of the market and hold cash, they can. If they choose to hold metals, or real estate, they can.

The point I am trying to make is that true diversification requires more than owning several stocks from different industries in the U.S. stock market. True diversification necessitates ownership of a variety of investment classes, as well as investment location diversification. When you have your retirement savings invested in stocks, bonds, real estate, foreign markets, and metals, you can call yourself diversified.

The best way to diversify your retirement savings is through a Solo 401k – accept no substitute.

Give Longboat a call or send us an email. We are not slick salesman; we are real people.

406-551-4775

 

Your 401k Stinks April 5, 2016

 

Educate Yourself About Self Directed Accounts March 22, 2016

Education is the answer

All too often I am approached by people who have never heard of a self directed IRA or a Solo 401k. These people are usually skeptical that they can use these plans or they may even question their existence.

While these retirement plan options have existed for many years, most people have never heard of them.

The reason is simple:

Large institutional investment banks will lose money when you manage your own retirement account.

When you set up a self directed retirement account, you take over the helm and make the investment choices that are in your best interest. You are no longer limited to a menu of investments offered by a particular investment bank.

With a Solo 401k, your choices are particularly powerful. Not only does it open up your options, but it also eliminates the middle man completely. There is no custodian needed with a Solo 401k; no permission to ask. You invest in anything allowed by the IRS, which includes pretty much anything other than insurance or collectibles.

Longboat Retirement Solutions can help you set up a Solo 401k quickly and painlessly.

Transferring your money out of a big bank IRA or 401k into a self directed account is not a taxable transaction, and there are no penalties.

Stop being robbed by the big banks; give us a call

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Why You Lost Money Today February 12, 2016

When the market as a whole goes down, people who own mutual funds that are “diversified” lose money (in general).  This includes most people who have an IRA or 401k through their employer, due to the fact that most institutional IRA’s or 401k’s are invested in mutual funds.

A true self directed retirement account lets you invest in individual stocks, precious metals, real estate, foreign markets, and more.

Large institutional banks advertise that they offer self directed accounts.  This is a sham.  These supposed self directed accounts only allow you to buy products that the bank that set it up for you sells – so that they can make money off of selling that product.  To me this represents a break in fiduciary responsibilities.

A Chevy dealer does not want to sell you a new Ford, even if the new Ford has better fuel mileage, better reliability, and costs less.  The Chevy dealer will sell you a Chevy, because that’s how he makes money – he makes a commission off of every Chevy he sells.  In fact the Chevy salesman is not allowed to sell a new Ford.

Similarly, a Fidelity guy will only sell products that he makes a commission off of – Fidelity products.  There may be an investment that he knows is a better fit for you, but if he makes no commission off of that sale, he won’t sell it.  In fact the Fidelity salesman (lets call him what he is) is not allowed to sell you a competitor’s product.

You are the only person in the world who has your best interest in mind when making decisions.  You may not always be right, but at least you are not trying to skim a small percentage of your savings, under the guise of “managing” it.

 

Why Asset Allocation Doesn’t Matter In The Long Run June 27, 2015

 

Part Three: Self Directed Retirement Questions May 19, 2015

This is the third installment in the Self Directed Retirement Questions, Answered.

These are questions I’ve been asked, my answers to those questions, and some commentary.

Question:  What is the difference between a Self Directed IRA and a Solo 401k?

Answer:  A Self Directed IRA requires a Custodian.  Custodians are generally banks and investment houses.  These Custodians charge fees to baby sit your money and tell you where you can and cannot invest your savings.  An SDIRA is far better than a standard IRA, but it can still have high management fees, hoops to jump through, and limitations in what you can invest in.

A Solo 401k, which is designed for the self employed, enables you to invest in anything that the IRS allows.  You become the Custodian; therefore you don’t have any filters on your investments (within the framework of the IRS’s allowed investments).  You basically don’t have to ask permission to use your own savings as you see fit.  Since it is a 401k, you can also borrow up to 50% of the value, up to $50,000.  And again, you don’t have to ask permission or fill out piles of paperwork to take out a loan.  You draw up the terms, put the terms in your safe, write a check from your 401k to you, and then just make the monthly payments to your 401k.  Because you are making payments to your 401k, the interest is essentially free – you are paying yourself!  A Solo 401k also enables you to contribute as the employee and the employer; in other words you can contribute over $50,000 a year to your retirement account – or over $100,000 if your spouse is a partner in the business.  This is a BIG deal.

My thoughts on the two different approaches boils down to this:

If you can, go with the Solo 401k.

 

More Solo 401k Questions May 17, 2015

Part two of the series where I answer questions that people have asked me about Self Directed Retirement Accounts.

Question:  “Can I buy a vacation house in another country with my self directed IRA or Solo 401k?”

Answer:  “Yes, you can, but legally, you cannot use the house for your own benefit.  In other words, the whole point of investment inside of a retirement account is for the benefit of the retirement account….therefore, you could not take a vacation at this house.  Of course the point of your retirement account is for the benefit of you – when you retire.  So, until you retire, you cannot use the vacation house.  I don’t know how anyone would know that you used the house, but regardless, it would not be legal, as far as the IRS is concerned.  I suppose if you went through a nasty divorce and your spouse wanted to stick it to you, they could tell the IRS that you took vacations in the house, and the IRS could look into it.  Another thing to consider is that you cannot do any handyman work on a house that is owned by your retirement account; you need to farm that work out to a contractor.  Again, I don’t know how anyone would know that you fixed a leaking toilet, or patched the roof on your beach house in Nicaragua, but technically, it is not allowed.”

Remember that when I say illegal, it is not a jail time thing, but you could lose more than the value of your account; that’s nothing to sneeze at.

You could buy a condo in Mexico, and rent it through a rental program with a management company, and the money would go into your Solo 401k – tax free.  This money would grow, tax free until you start taking distributions, then the distributions would be taxed at whatever income tax rate you are in at the time.

Alternatively, you could set aside a portion of your account as a Roth, and use those funds to make payments on your condo.  When you retire, you take the condo as a distribution, and since you already paid taxes, you pay none.

I think making an investment in foreign real estate is a great choice for inside a self directed account, but you need to stay within the guidelines.  Investing in emerging markets is exciting, fun, and creates true diversification.  Hell, you might even make some money!

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