I recently had a conversation with an individual that was considering investing in a business with an IRA. He was a successful executive in the hotel industry and was the typical long-term employee that had an employer-sponsored 401k that allowed him to invest in a select few mutual funds. Over the years he had contributed a substantial amount of salary deferrals, along with company matching he had accumulated a nice little nest egg. The problem is as far as he was concerned, was that he was investing in things he didn’t understand. He was investing in things he had no control over and it just wasn’t working.
After leaving his job of many years and doing some research he discovers that he could roll his 401k into a Self-Directed IRA and take checkbook control of those funds. His expertise has always been hotels and motels and now he could use his retirement funds to invest in just that. He shared with me some of the properties he was looking into.
He found a 15-unit motel in Pagosa Springs, Colorado. It has an owner’s house, lobby and office on 3.5 acres with room for commercial expansion. It also has a workshop and full RV hookups. Asking price is $499,000. His research also revealed that the annual income for this motel was about $150,000.
He also showed me a new hotel and restaurant that was recently built in a location with high traffic in Kickapoo River Valley. The restaurant seats 90 people and includes an ice cream shop, drive-through window and sells gourmet coffee, snacks and other beverages. The hotel has 19 units that sleep up to 74 people. Each room is already set up with Wi-Fi, cable TV, microwave oven, and a refrigerator in each room. The hotel and restaurant are considered turnkey. The asking price for this business is $945,000.
You need to know the rules of investing in a business with an IRA. There are strict IRS rules & regulations to follow in order to avoid stiff penalties.
These are just a couple of the many hotels he is considering investing in with his Self-Directed IRA. I explained to him he needs to know the rules of investing in a business with an IRA. He is very confident that he understands the rules, and this is a good use of his retirement funds.
So what about you, what are you passionate about? What do you know and understand? And why are you not using your retirement funds to invest in that? You can take checkbook control of your retirement through an IRA owned LLC and invest in what you know and understand. Take charge of your retirement future today, contact us now we will help you get started with your IRA owned LLC.