A tale of two Investors…
about two years ago Chris and Mike had an opportunity to invest with their friend Bob who was putting a company together.
Chris took a check of $100,000. (The minimum investment) from his savings and gave it to Bob. Mike took $120,000. From the hard earned money in his retirement account, paid $20,000. In taxes, started an IRA Roth and directed the Account Administrator to send a check to Bob’s Company.
Incidentally, Chris had previously asked Mike about the IRA Roth on at least 5 different occasions. Mike had explained how simple it was and also the Benefits – No tax on the Gains! However when Chris tried to do this, the Financial officer working on this new Company said “I’m not sure that works…” (meaning: I don’t know anything about this.)
Fast forward to Today. Bob’s Company has done VERY well and the initial investments are now 4X (valued at four times the initial investment and Optimistically projected to be worth another 4X value by March, 2020!)
If Chris and Mike decide to withdraw now, from Bob’s company, Chris could pay up to 39% depending on his other income while Mike will not pay anything on his $300,000 profit. Mike does have to leave the profits in his account for 5 years but after that he may withdraw the proceeds tax free. (A Roth has to be in existence for 5 years before you can withdraw tax free) He may withdraw his initial $100,000 tax free at anytime. And he can invest the entire $400,000. in other Opportunities at any time!
Personally, in my Real Estate career, I’ve seen that Persistence is THE attribute that most Successful Investors seem to have! Should Chris have been more persistent with the Financial Officer at Bob’s company? Should you be Persistent?
When you join us Tuesday, March 27, 2018 with our Speaker, Attorney & CPA, John Hyre you’ll learn How to legally and Ethically Hammer the IRS! And whether to Invest like Chris or Mike
PO Box 307
Marblehead, MA 01945
PS Keep in mind this scenario could pertain to almost any of the investments that YOUR Self Directed IRA Roth is interested in!