Greg Herlean
speaker
84 appearances
1 recordings
1 series
first heard Nov 2024
last heard Nov 2024
Greg Herlean’s voice in public audio — every appearance, attributed to the second.
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Yeah, absolutely. I mean, you nailed it. So once you make X amount of dollars, you want to contribute. We talk about contributing to a self-directed retirement account. Self-directed because now you can invest in what you want. So if you contribute to that and then invest it,
in a deal or a business or in precious metals, those profits, then all those gains, you don't pay taxes on those gains unless at some point when you pull it out, you pay taxes if it's a traditional IRA. But if it's a Roth, you don't pay taxes then either. And so that is one template. But I'm also not here to say put all your money, one, because you can't, into a retirement plan.
When there's certain real estate transactions that you're doing where you get great depreciation, Those go outside of your IRA. But there's other deals and opportunities that you make bigger hits, bigger interest or loans. You use your IRA and those profits compounding your profits. You and I could invest in the same exact things for the next 20 years.
You could do it inside your LLC or in your name. I could do it in my IRA, getting the exact same returns. 20 years from now, I'll have hundreds, if not millions more than you, just because I'm not paying taxes on my gains every year.
Yeah. And then that money that you're saving, the 30% compounds, right? It's like you can put what, 20, 30 grand a year or something, right? In tax free.
Yeah. In certain accounts, we can help entrepreneurs that have their own business set up a solo K, a 401k, where they can actually contribute up to $70,000 a year. Yeah.
Yeah. So I think that's like to me, again, not finance advice, but to me, that's something that it became a bit of a no brainer to me because then, yeah, you can use that to invest in some stuff. So what what what else are people missing? We talked a bit a bit about that. Um, I, you know, the real estate means a big thing.
Like I, you know, got married and, um, my, my wife's, uh, took up real estate and, you know, full-time real estate investor now. Um, and I know that there's a, you know, important if you are doing it more than, uh, anything else and it becomes full-time as you can get accelerated depreciation. So that's the important one if you're doing real estate too.
Yeah, I mean, that's good for that asset class. I'd say the thing that I think a lot of people forget about when we talk about self-directing is you and I just talked about contributions, people that want to save and put money away. The 100 million accounts I'm talking about that have 17 trillion, almost probably 50% of your listeners have an old 401k from a previous employer.
In the last six to seven years, everyone's changed jobs. When I say everyone, a large percentage. So therefore you have this old 401k and a lot of people are like, oh, it only has $25,000. I'm just going to, I don't know what it's really doing. I think a big miss is people are not paying attention to the $25,000 accounts that they own, these 401ks. Those accounts from previous employers are
qualify to self-direct to then invest in what we're talking about. And I see people wholesaling with their accounts. I see people buying and holding Airbnbs with their retirement accounts. Obviously, crypto this last week has been really good too for certain people. But I don't want to just pick on this last week because I can just look at throughout history
that I've been doing this 20-something years, getting consistent returns, investing in asset classes you understand will outperform generally the market. Now, I'm not a financial advisor. I'm not going to give you advice of what to invest in.
it basically matches inflation, right?
So it's not, it doesn't move the needle. And so I just want to bring that up because I feel like when we talk about this message, people are like, okay, this sounds cool. Maybe I'll contribute to an account or start an account. If you have a current 401k or an old 401k, not current, those qualify, right? Or if you have an IRA account.
And so that's kind of like my mom, what she would do, I think like most Americans, they'd open up every month. Now it's an email, right? But they open up the email or the letter. My mom's still old school, right? She would open up the letter. And all she would look at is if the account did what? Went up or down. And then she would just file it. She has no idea where the money's at.
That's how rich America is.
Well, and you don't get rich that way. You know, like if you want to really invest and get rich, it's like I'll give you an example. And I mean, you're right on the point here because I think people think that 25K is too small because, again, they don't understand what I said. They think, oh, if I want to buy 200K property, I need 200 grand. But it's not the case like buying your own house.
Right. Like I bought one of my, I think it was my third deal back in the UK. It was like my best deal. I put 25K, a bit more, 30K in, mortgaged the rest on it. And that house was doubled in value in the last 10 years. And it makes about 15, 20 grand a year net profit. So it's like, you know, in 10 years I make 200 grand profit and it's doubled in value when I sell it. from a 25 grand investment.
I made like a 10x on that money in cash, plus another probably 150k in value add. So it's like insane returns, right? You're never going to get anything close to that. And that was with, you know, a small 25, 30 grand. I found a cheap house and a good deal and made it a value add so I could rent it for way more than the average. And you just got to get creative, right?
I mean, you'll agree it's like the creative deal structure.
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