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Real Estate Investors – Pay Yourself First and Use Your IRAs
You’ve heard about paying yourself first, right? This is typically discussed when people are planning for retirement. I want you to think about it right now as you start and/or continue building your real estate investing business. Think like a true entrepreneur. This is really important. I have said this before and here it is again: Your business exists to support you; you don’t exist to support your business. Your business exists to support you. And if you’re not extracting money from your business, then what are you in business for?
Your business exists to support you, so you need to pay yourself first. Always pay yourself first. This was a hard lesson for me to really comprehend and understand in my early days, but now I understand it. It makes sense, because hopefully you haven’t spent all the money that your business has made and that you have taken out as the owner. And if you have to, you can always loan the money back to your business.
Now one way to start thinking in that direction is to do real estate deals in your self-directed Roth IRA. If you’re not doing deals in your IRA, you’re not really seeing the true power of this business, because you can go from $1,000 or a few hundred dollars in your IRA to $20,000 like that. The majority of real estate investors don’t take advantage of this type of investing.
You just have to know how to do it. If you have not done any deals in your self-directed IRA, then I urge you to explore this and to learn about this. I did one deal in my IRA way back when I first learned about doing Roth IRAs, and it seemed like in the beginning it was the hardest thing in the world to do. There was all the legal paperwork and it went on and on, blah, blah, blah.
Well, first of all, yes, it’s legal. Secondly, I would much rather be in control of my retirement funds than having the stock market be in control of my retirement funds. So, you can option a property, you can do a simple $100 option contract on a property. It can come from your IRA, your IRA can be the buyer, and you can option a property for $90,000.
You could turn around and then you sell that property for $110,000 or whatever it is, and that $20,000 profit will go directly into your self-directed Roth IRA tax-free for life. It’s a phenomenal tool, and if you’re not using it, you are missing out. You’ve got to start getting into this revolution if you will on using self-directed Roth IRAs, because the power is tremendous.
But pay yourself first. It will help you sleep better at night. Let your business have only what it needs to have, and you take the rest. Your business exists to support you, so try to get into the habit of paying yourself first. Learn about IRAs and continue growing not only as an investor, but a wise and successful entrepreneur.
As always, I welcome your comments and insights. Please feel free to post a response. You can also review the information I have for you for FREE at the following:
www.freemakemoneygift.com/Invitation.html
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It is true that IRA really means paying yourself for your retirement. If you invest with your self-directed IRA then you would realize the potential of this business and realize the advantage of this investing.