In this episode Blake is joined by, special guest, John Bowens. John is a senior manager at Equity Trust Company, and a highly sought-after and respected educator in the self-directed IRA industry. In this episode, John and I will go over everything investors need to know about a self-directed IRA as well as answer many frequently-asked questions our viewers and listeners have about a self-directed IRA. We will also walk through the steps on how to use your self-directed IRA and discuss how to maximize and build tax-free wealth using your self-directed IRA.
How To Build Tax-Free Wealth With Self-Directed IRA with John Bowens of Equity Trust | Solomon Investor
What is a self-directed IRA?
This is a question that we have been getting a lot- and in today’s episode, we will take the opportunity to answer this question and discuss all of the benefits of a self-directed IRA and how to use it to build tax-free wealth.
Today I am joined by, special guest, John Bowens. John is a senior manager at Equity Trust Company, and a highly sought-after and respected educator in the self-directed IRA industry.
John and I will go over everything investors need to know about a self-directed IRA as well as answer many frequently-asked questions our viewers and listeners have about a self-directed IRA. We will also walk through the steps on how to use your self-directed IRA and discuss how to maximize and build tax-free wealth using your self-directed IRA.
Key Takeaways:
About John Bowens (1:40)
What is a self-directed IRA? (5:58)
What kind of customers does John work with? (12:59)
How do you move your funds into a self-directed IRA? (18:54)
What are the benefits of being self-directed? (28:01)
How can investors use their IRA in cryptocurrency? (37:34)
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Financial companies, they don't want folks to move their money from point A to point B, very easy to get the money in the door. But sending it out is not always very easy.
And most people kind of freeze, they just freeze up. They've got money in an IRA. They literally have it just sitting, wherever it's sitting in whatever custodian that's put it into this massive big pool. And they don't know what to do public market, you've got no control in the private market, you take back control, you get tax free growth, and then you get tax free withdrawals. Guys, this is so powerful if you don't start now the question is When will you start?
Hey, this is another Solomon Investor show. I am your host, Blake Templeton. And this is where we focus on the wealth strategy, the world's wisest man, King Solomon and translate it for you, the 21st century investor, covering everything you need to know between wealth, faith and excellence. In this episode, we'll be discussing wealth, and specifically how to use your IRA to create exponential wealth. We'll discuss the secret benefits of self directed IRAs, and then all you guys have been asking for, and that is simply this tutorial of how to actually use a self directed IRA. We'll answer questions on how you can actually maximize your wealth creation. If you like what you're hearing, then act now and hit the like button. Like do it right now. Make it turn blue. And then subscribe to this channel. last hit the bell icon so you're notified every single time a new video like this comes out. All right, with no further ado, today my special guest is john Bowens. JOHN is one of the most sought after and respected educators in the self directed IRA industry. He's also a senior manager equity Trust Company, which is a company we've been working with for quite some time. Jon's traveled across the US, he's trained nearly 60,000 investors. And he's done this in over 350 workshops and classes. What I love about john is he is crafted a compelling educational curriculum. So it's not the black and white doldrum way of teaching. He's incorporating the case studies and helping you get into, you know, really, how does it apply to you? How do you use your IRA? And how do you build wealth with your exact scenario? So john, welcome to the show.
Hey, Blake, thanks so much. Thanks for having me really excited to be a part of this podcast, I've had an opportunity to plug into the program on multiple occasions. I think that some of the philosophies and concepts that you're sharing to your audience members certainly are well in lined with self directed IRAs and solo 401, K's and, you know, creating wealth in a tax exempt environment. And I appreciate the term that you use exponential growth, I like to use the term compounding interest in the absence of taxation. And I know that's a bit of a mouthful, but I'm sure we'll get a little bit more into the details of how that works with a self directed retirement plan. But our goal and what I try to achieve in teaching and educating clients all across the country, is how to create wealth and preserve wealth. And so when we talk about creating wealth, there's a number of ways in which we can create wealth from investing in real estate, which is a core focus of ours to cryptocurrency to commercial real estate, such as self storage, or mobile home parks, to investing in gold and silver, we hold as an alternative asset custodian here at equity trust, a variety of alternative investments. And so we really give people the opportunity to be able to take control of their retirement account, diversify into these alternative investments, and then be able to preserve their wealth. And that's when we get into the tax nature of these self directed retirement plans, which can allow someone to invest in grow in a tax free and tax deferred environment and leveraging that term that I mentioned compounding interest in the absence of taxation. So yeah, happy to be here, Blake and happy to answer any questions that your viewers have a fantastic I really appreciate that. And that's why, you know, setting the stage for this episode is so important. I mean, we're all aware of the political system unraveling our media outlets being censored of what's truth and the stock market being completely manipulated. And where we're headed is a socialist communist Rand structure. And most people kind of freeze, they just freeze up. They've got money in an IRA. They literally have it just sitting wherever it's sitting in whatever custodian that's put it into this moment. Big poll. And they don't know what to do. So john, I'm excited to dig into this. Because our desire is to give them the ability to access and gain control of their wealth. And as a Solomon Investor, you need control. You know, we're tapping into King Solomon's wisdom. And King Solomon would have never just thrown his money out to the wind and tons of baskets and, you know, literally not had a fortification around it, we wouldn't be in something we can control tangibles that we can actually see to it, that we're going to actually build wealth. And the we'll talk about the beautiful thing about the self directed IRA. But if you don't know what you don't know, you literally are going to be doomed to failure.
So scripturally speaking, without vision, you will perish. And so we need to have the ability to access our wealth, which means you can't have it, where you can't direct it, you need to be able to direct it. So I'm calling you up as a Solomon Investor. And John's gonna help navigate the way of how you can take that freedom back how you can actually have control. So john, let's just start with, you know, what actually is a self directed IRA. Yeah, so like, a self directed IRA is really no different than any other IRA, 401k, or other retirement plan that any of the listeners or viewers who are familiar with, or currently have. So let's think an IRA, a 401k, a 403, b 457, a Thrift Savings Plan, which by the way, those are just different types of employer sponsored retirement accounts. But let's just call these retirement accounts. So if you have a retirement count, most people are only familiar with investing in maybe mutual funds, ETFs stocks, there are managed portfolios, where folks have a actual managed portfolio structure, and they really can't make any decisions. It's all done for them. And then there are other folks that have an account that is self directed, but that financial institution may only allow them to self direct into traditional investments. So that is stocks, mutual funds, ETFs, or in other words, the public markets, what a self directed IRA, alternative asset, self directed account, I like to use that term alternative assets self directed account. And those are the types of accounts that equity trust offers. Now, our IRA is no different than the IRA with a traditional brokerage house or wire house. So think, the largest custodians or largest financial firms in the industry, where you can go and open an IRA, and you could put money in there likely only gonna allow you to invest in stocks and mutual funds and other traditional assets. Our IRA is no different. The only difference is our IRA retirement plans, as a custodian, allow people to invest in these alternatives. And all of our technology, all of our infrastructure are over 400 employees, we're all focused on helping clients invest in these alternative assets. And when I say helping clients, what I'm referring to is providing the facilities providing the infrastructure, providing the customer support, so that when a customer comes to us and says, I want to invest in real estate with my IRA, instead of stocks and mutual funds, or I want to invest in cryptocurrency, or I want to invest in gold, and silver, or commercial real estate partnerships, or this private equity fund, or whatever it is they want to invest in, they have the ability to be able to do that through their self directed retirement plan.
Whereas again, most of these other firms are just not going to allow people to do that. So that's the best way to understand a self directed IRA. It's an industry term, not a legal technical term. And all of these retirement plans are in what is called a tax exempt environment. So when I say tax exempt environment, think I buy a property for $100,000 today, and I sell it for $150,000, six months later. So I do a fix and flip deal. That profit goes back into the IRA. And so as long as I'm following all of the rules and all the procedures, all of the guidelines, that profit that capital gain is tax exempt in my retirement plan. Now we get into the details, of course of tax deferred, traditional IRA versus tax free Roth IRA, and we have a lot of training and information around that. But the important aspect of this is going back to that comment I mentioned at the beginning, which is leveraging compounding interest in the absence of taxation. And the last thing I mentioned Blake is that question that you ask there is very important because I have found where people are new to this concept. They come in with a preconceived notion that if they want to buy real estate, or invest in private places, mints or gold or silver cryptocurrency with their IRA, that there's going to be some sort of adverse tax consequences or penalties, you'll find that that's not the case. If you roll over your 401k money into a self directed IRA, and you buy a piece of real estate, so as long as you follow all the rules, and you follow the process properly, that's why you work with a custodian like equity trust, then in that respect, there's no tax liabilities associated with moving the money out for the investment. It's just like buying a stock. When you buy a stock with your IRA. What happens cash leaves the account in return for that cash is a stock certificate. When you buy real estate, cash leaves the account in return for that cash is a deed to the property. So for example, I bought a rental property in March of 2020. It's cash flowing at 15 $100 a month gross, I have two units A and B renting out at 750 a month. My net operating cash flow back into my retirement plans tax free is around 12 112 50 a month, when my last March when my self directed IRAs bought the property I executed on the transaction through equity trust is my custodian equity trust into wire transfers to the title company, the title company closed on the deal. The title is in the name of my self directed retirement plans, not john Bowens not my LLC but my self directed retirement plan. And so now all my profits, go back into my retirement plan, and they're all tax free. Now I'm forcing appreciation on this property, I bought it for 63, I anticipate the value to go up in the next few years at about 100,000. If I sell that property in three years from now for $100,000. And I recognize over a $30,000 gain, that $30,000 is tax free in my retirement plan, because I'm not subject to long term capital gains tax on my self directed retirement plan. So hopefully, that kind of paints the picture for everybody, and gives them a real world context behind how you can actually put together real estate transactions or other types of transactions in these self directed retirement plans.
Yeah, that's really good. And just, I mean, I think it's very clear, but just so it's not if it's not clear. The reason we're having john Come on is because obviously, a lot of our investors, you guys listening, you have a IRA, and you just don't know what to do with it. You don't know, it's like a T rex with little arms. He's just like, I don't know what to do. And so, john, I've had so many investors, invest seven figures with us. And then years later, they're like, asking us the question, can you do anything with VAT, and it's really, quotations that it's like that thing over there that that, that money that's sitting in this abstract account, you know, in the stock market. And so this is beautiful guys, the clarity is you can invest in our everything that Warren capital does. That's why we're bringing john on. So you can actually see the points here. But with this said, it's freedom, you're gaining freedom, you're not you're not giving it over. Someone else has control. And when you're taking back self directed, you now have control to invest, as john said, and now we have massive benefits. So with that said, let's let's process through who your normal customers. I mean, I think some people have the limiting belief, it's probably not me, like that's a good idea. But I probably am not someone who could be a customer.
Yeah, that's a great question, Blake. And, you know, frequently I have folks that will come to our seminars or conferences, or, you know, watch our YouTube videos, or whatever it may be. And they look at this whole concept of investing in alternatives, whether it's a passive approach, investing in some sort of fund, or a more active approach where maybe they want to go out and buy real estate and hold real estate, like I do with my self directed retirement plans, or lend money to other investors with my self director retirement plans, which is another strategy that I deploy and our other clients do here at equity trust. But it really runs the gamut. We have investors that start with a $5,000 contribution. And they might make investments in transactions that require a smaller amount of money. And then we might have investors that are moving over, you know, millions of dollars in retirement capital, and they want to invest in a private fund, or maybe gold or silver cryptocurrency or maybe even real estate. And so it really runs the gamut. We're not, if you will affirm that, I'll say, discriminates against, you know, one particular type of net worth versus another type of net worth. Really, you know, everybody, if you will, is treated in a very similar capacity. It really just depends on that individual's needs. And the reason why that is Blake is because we're directed custodian. So the way in which we are regulated, the way that we are structured is that we provide education information, the technology systems, the infrastructure, the customer support, the acumen That's sort of our product, if you will. And then our service is the technology and our customer support. And so we provide this infrastructure and facilitate the capability for people to make their own decisions. So we don't review investments for merit suitability, we don't endorse any third parties or recommend individuals invest with a specific person or entity. You know, we're the custodian that says, here's all the information, here's the education, here's some training, here's the account, here's our services. And then when you do your due diligence, and you find an investment opportunity that you feel makes the most sense for your portfolio, then you can come to equity trust, and we can guide you through the procedures in order to send funds from point A to point B. And that's what I think's really great about the alternative investment business is that one has to your point, Blake, the ability to control where one invests in how they invest in when they invest, the timing of their investments in timing can be absolutely critical in real estate and crypto and private entity investments, which may only have a small window of opportunity for one to participate. And so we of course, would encourage folks to, to do their due diligence, do their research, and make a decision on on the investment that they want to make and make sure that they would do that in a timely fashion. Because we know that timing in the marketplace is absolutely critical. Particularly when we look at real estate, when we look at crypto we look at at Golden silver, and you know, as far as exit and entrance into a marketplace, and even traditional stocks, bonds and mutual funds, you have to be mindful of that. So hopefully that that sort of answers the question or frames things up for for investors. But it's really for investors of all experience levels, and investors of all income statuses from the, you know, individual that's just starting off with their retirement account, work with a lot of investors that are in their 20s and 30s, that are starting retirement plans for the first time and they're making contributions and they're starting that process. Now, it might take them some time to get to a point where they're going to make some larger investment opportunities happen. But that's okay, you know, maybe it's three, four or five years. And for other investors, there's the ability to invest in small dollar types of transactions. I know Blake, you had mentioned Self Storage, a quick anecdote for everyone. Investors name is Scott. And he did an ad b2c transaction. Now I understand this may not be for the passive investor. But for any active investors that are on the call, he found a self storage deal. It he needed about a million dollars for the deal. He didn't have a million dollars in his Roth IRA and only about $20,000. What he did is he put the property under contract with an option. So the seller was willing to write an option contract within his Roth IRA had the right to buy the property at a future date at a predetermined price, his consideration fee on the deal was $2,000. So we gave the seller we'll call the seller a it was an A to BTC transaction gave the seller $2,000 tied up the property took control, no ownership just took control with the option contract, sold that option contract to an investor buyer. So we already had an investor buyer lined up he had a deal, he negotiated the deal with the seller brought the end buyer in who funded the deal. And his Roth IRA collected a $20,000 assignment fee. So he invested 2000 made $20,000 tax free that he put into his Roth IRA 0% tax. And then he was able to take that $20,000 and roll it into the next deal. So I give that anecdote, Blake, because it is important to mention that even if you're starting with a small amount of money, if you're creative, you have the the fortitude, you have the willingness, there are ways to go out and do deals that only require a small amount of money.
Yeah, I love that. And with that, with that said, let's process through the idea of like, how do you get the funds into the self directed so let's kind of talk tutorial side of what's a step by step of now we know what a self directed IRA is. We'll talk through the benefits shortly. But, you know, let's talk you know, step by step for most people. We've got a lot of executives, business owners, doctors, attorneys, high net worth individuals, and kind of the last thing in their mind is like this extra uncertainty of how much what am I going to do? And so it's kind of like just put on the backburner. So take us through that step by step tutorial of how do you actually do it?
Yeah. And like what you're saying there is that you know, thought of, you know, how do I move the money over how do I transfer it the uncertainty that's very common in the financial services industry, and if you think about it, financial companies They don't want folks to move their money from point A to point B, right. And so there's not a whole lot of infrastructure within financial services organizations to move money out the door, very easy to get the money in the door. But sending it out is not always very easy. We understand that at equity trust. And that's why I have an onboarding unit that works with every new client that takes them through that process, so that folks don't feel like they have to make all the phone calls on their own, have to figure out how to fill out paperwork. And so it's always important to mention to folks, and it's not just equity trust, there are other financial companies out there that offer these services as well. But really, the first step of the process for an investor is to open a self directed IRA. Now, that's a simple two page application, we do everything digitally. So we assign every one of our new clients, a what we call self directed counselor, that self directed counselor answers their questions, talks about who equity trust is, so they feel comfortable with our organization, they know how we're regulated, they know where our offices are at our physical presence, they understand what they're doing, they understand our fees associated with opening the self directed IRA, and then we help them open an account. And just about everything can be done digitally. So they open their account, and then they're going to transfer or rollover funds. Now, there are four funding methods that are important to mention for investors. So funding method number one for all listeners and viewers, is you can rollover money from a 401 k 403, b 457, Thrift Savings Plan or other employer sponsored plan, there are different types of plans could be a pension. And we can talk through that.
The second is a transfer from an existing IRA. And the best way to think of it, it's just like moving from one bank account to another. A self directed IRA is just a bank account, essentially, with a different type of tax nature and tax structure and reporting mechanisms. That's really all it is. And so one can transfer from their IRA to an equity trust IRA. The third is a contribution. So every year, so as long as one is eligible, you can take money out of pocket and make a contribution. Now, there are some contribution limits that we have to discuss one on one, depending on the individual situation, could be 6000, could be 7000, could be more depending on the plan. But by and large, if someone wanted to fund their account with a contribution, they have the capability of doing that. And then the fourth is what's called a Roth conversion. And this gets a little bit more into the details. And we have more training and education. But to give everybody that 50,000 foot overview, if you have tax deferred traditional funds, and you say you know what, I don't want to have to pay the taxes in the long term on this money, I want to pay the taxes. Now, you can do what's called a Roth conversion and actually convert the traditional money into the Roth, pay the taxes on the smaller seed, so you don't have to pay it on a much larger crop if you anticipate those funds blossoming into a much larger sum of funds. And so those are the four funding methods. As far as rollovers and transfers. A lot of folks on today's call probably either have a 401k, or have an IRA, if they have a 401 K, or could be a 403 B or 457.
There are different types of accounts depending on who you work for. But if they have one of those accounts, and they're no longer working for the company, they can simply roll that money over into a self directed IRA. It's very easy to do, they open an account, they call their plan administrator, they initiate a direct rollover, if they need help with that process we help them with the process will call over to that administrator with them. Most of the time, it just takes a phone call to initiate a rollover. It is important to note that if someone is still working for the company, seldom Can you roll over the money into an IRA, you have to leave the company. There is one exception to that rule. If the plan allows for what's called an in service withdrawal, that's the terminology for all viewers to write down in service withdrawal. So call your plan administrator and say can I do an in service withdrawal? It's not a distribution in taxable you're actually going to do a direct rollover into an IRA. For those that are 59 and a half or older. 59 and a half or older is the qualified retirement age. In most instances, folks that are 59 and a half or older, they can actually initiate one of these in service withdrawals. And Blake This is one of the best kept secrets.
It is a lot of fun.
Yeah, a lot of investors I talked to you they want to invest in alternatives and they go I can, I'm limited because I I'm still working for the company. And then they learned about this in service withdrawal. They call up they get good news that they can do it. And now they've just unlocked all of this capital that they can move out in the traditional markets and invest in what they deem best fit. So that's really important one to mention is those rollovers transfers from existing IRAs, one of the most common questions I get Blake is, can I move over just a portion of my IRA, john, I don't want to move it all over, I just want to move some of it over to get started, make my first investment, see how it goes and then maybe make another investment. folks can transfer a rollover funds as many times as they want throughout the year, contrary to what you hear on the internet, where people talk about this 60 day distribution, rollover, which you can only do once in a 12 month period. We do rollovers direct or transfers direct, we don't take money out of an account and then try to return it that you can only do once in a 12 month period. So the important takeaway for folks is, you got to make sure that you follow the procedures properly. And these are some of the things that we can provide some information and education around.
It's really good. These are some really key nuggets, guys. So for you have a larger sum in your IRA, like this is mind blowing. Because in our funds in self storage, mobile home parks, cryptocurrency and our funds, the amount of money that you can actually make tax free, it just blows your mind, especially if you've been on that mindset that. I mean, if you've been in the stock market and you haven't, you're you're seeing capital gains, so you can tap into the real estate tax benefits. And then you can tap into the self directed tax benefits. I mean, this is this is the Uber wealthy secrets, this is where everyone, I mean 10% A Forbes says 10% of billionaires actually came from the real estate world. And so when you're able to tap into a self directed minute, it just makes such a world of difference. With equity trust, we've had many people shift their money over and didn't know, you know, I had a guy who was 63 had seven figures in a company account, and didn't understand how he could actually transfer that. A utilizing that role. So love that it's really, really good. How hard is it to do this, you've mentioned you help. And I guess let me just say this to guys, is when you come through more on capital. So ours are a subsidiary of a Solomon Investor, when you come through born capital, we're then working alongside you. So our VP of operations, Zach Morrow, he's working alongside you with equity trust. And so it literally creates this synergistic smooth process, where you're literally not having to think and process through paperwork and how and where and what. So it makes this process super smooth equity, we actually have been with other custodians, like equity trust, but they didn't have the customer service we needed to provide to our investors. And so that's why we shifted years ago to equity trust, and it's been a very pleasant smooth process since then. So let's tap into the benefits. What are the benefits of self directed some of it? We've kind of mentioned as we've kind of processed through some examples, but let's just do an example. Tom has, you know, 500,000, and he wants to invest into self storage and mobile home and mobile home park fund. What are the benefits of going self? self directed?
Yeah, so the two primary benefits are one diversification, which we've talked a little bit about, and that is the ability to invest in the private markets compared to the public markets. Some people refer to this as investing in non correlated assets and real estate, investing in real estate structures, I can give someone the ability to diversify beyond the public markets. So that's number one. And that's why we see folks attracted to this self directed IRA concept. The second are the tax advantages. And I think it's important to mention that there are really two types of tax buckets that you have in terms of retirement plans. So you have a tax deferred bucket, and you have a tax free bucket. So when we say tax deferred bucket, think traditional IRA, think most 401 K's thing thrift savings plans, employer sponsored plans, you don't work for a company, they give you a retirement plan benefit. You make contributions, usually they're tax deductible contributions. So when you hear that term tax deferred, that's what we're talking about. We're talking about those types of plans, traditional IRAs, 401, K's and such. And so what tax deferred means is that when you put money in you get a tax deduction, it grows tax deferred. So what you can do is you can mitigate any Short term long term capital gains tax or ordinary income taxes and each incremental year. And then when you take money out after the qualified retirement age of 59 and a half, that's when you pay taxes. So if I grow a traditional IRA to a million dollars, and at 59 and a half, I take a $100,000 distribution, I don't have to, but let's say I do, then I'm going to pay taxes on that 100,000. So if I'm at a 20% tax rate, let's say, I'm going to keep 80,000, I'm going to pay $20,000 in taxes, that's tax deferred growth. Then on the opposite side, we have what's called a Roth IRA. And Blake, I would encourage every investor on today's call, I can't say that a Roth IRA is a good fit for every investor that I mentioned before.
That equity trust is a directed custodian, we don't give advice and such, we provide education. But what I would encourage everybody to do is to at least examine a Roth IRA to determine if it's good for you. And if that means talk to your CPA or your wealth planner, I'd encourage you to do that. Because here's what a Roth IRA can afford you. When you put money into the Roth IRA, it's after tax, you don't get a deduction, you get the taxes out of the way in the seed, we call it, you get tax free growth, and then you get tax free withdrawals. So imagine if I grow a Roth IRA to over a million dollars, at 59 and a half, I take 100,000 out, I'm not writing a check for $20,000 in taxes, like my last example, I keep that entire $100,000. So from a compounding interest perspective, if we start punching numbers into a time value money calculator, in the end, the Roth IRA oftentimes outpaces the traditional IRA. Now, it's all relative to your returns, it's all relative to you having the ability to self direct and perform for these retirement plans. But the Roth IRA can be incredibly powerful, and they put it into context for you, Blake, I had two customers, has been a WiFi to St. Louis back in 2010. We had a lot of investors, by the way that came to us in 2010, after the Great Recession. Why because they took 3040 50% haircuts on their portfolios in the traditional markets. Once they recovered. At that point, they were ready to buy real estate, they're ready to get out of that, that rollercoaster, so to speak. And their words, not mine. And so with this couple did is they took $100,000 from their 401k, they moved him into self directed retirement plans, they converted them to Roth IRAs, that's that Roth conversion we talked about got the taxes out of the way they paid about $35,000 in taxes in 2010, they now have bought 14 cash flowing properties. They have 14 cash flowing properties, generating $130,000, in net operating cash flow. And for all the folks out there that net operating cash flow, it doesn't have to be from individual rentals, it could be from a real estate partnership, it could be from you know, plug and play any type of alternative investment, you get to perform here and take control. So they got $130,000 coming in every year, they're over 59 and a half, they can conceivably take all of that cash flow and take it out tax free, they don't pay a single dime in tax. They grew their accounts to over a million dollars in properties and cash flow all tax free. If they sell those properties. Those properties have appreciated in a very significant way. There's 0%, long term capital gains tax, no recapture depreciation, no tax return for the income associated with those IRA rentals. It's all tax free in the account. So as you can see, I do get a bit passionate about this because in terms of simplification, in terms of efficiency and effectiveness, a Roth IRA or traditional IRA can be incredibly beneficial. But I definitely wanted to make sure I spend a little bit of time for viewers and listeners on the Roth IRA because of those tax free benefits. And the last thing I'll say is, it may not be an IRA for some folks on today's call, some folks may have heard of what's called a self directed solo 401k, which gives you a tax deductible bucket and a Roth bucket. And it just depends on who you are as an investor, what your makeup is, from a tax perspective, whether you're self employed or not. But there is an account type out there that's called a self directed solo 401k. We do provide the services for both a self directed IRA and self directed solo 401k. So for any viewers out there that are doing research on self direction, you might hear that term self directed solo 401k. Really, for all intents and purposes, it's the same as a self directed IRA. It's just going to depend on your situation as to what type of account is going to make the most sense for you. And those are things that can be discussed.
Very good. Yet, the you know, john shared about these two powerful benefits of this process in self directed or Roth and I want to kind of step out 10,000 Feed again, just remind you that he talked about the private market versus the public market. So we talked about the Solomon Investor, the public market is actually the actual large bathtub of everything that's, you know, all the shell companies that are publicly traded, if everything's inflated, or pumping tons of money into it from the Fed. And it's, it's a place that actually has lots of manipulation, and you have no control. So the public market, you have no control the private market, you take back control, public market, you've got no control in the private in the private market, you take back control to the realization is, is you gain control, you got to have control, and you have to have freedom as a Solomon Investor, then now the tax benefit, that's actually where you thrive. That's where you build wealth. This is wealth creation. And wealth creation is where everyone always wanted to end up. But they didn't take the steps in the very beginning to actually do that. So setting yourself up correctly, before you enter investments is very, very important. So going back to the the sample exam, or the example of, you know, self storage and mobile home parks or crypto, when you're going into let's say, the crypto fund with us. That makes a lot of sense, doesn't it that you'd want to make sure that you're set up properly, because you're going to have so much influx of cash coming in that you want to make sure it's tax deferred, or it's actually non tax depending on which direction you go. And so you want to make sure that you have it set up. We've had multiple investors who didn't actually set it up, who actually decided they didn't want to actually go with equity trust and move their accounts. And though they're those funds, then they couldn't come with us. Because there's they had to stay in the public market. So if they didn't actually transition to a custodian where it could be in the private market, they couldn't invest. And then we've, you know, for instance, one of those is back in last January, when you had a 38% loss in the stock market. And he realized that the previous 10 years, the previous 10 years, he had only made point 7% when you averaged out the last 10 years, and then he took a 30 a 38% haircut. So it's very important for you to be able to be self directed, it's very important for you to be in control. That's where wealth creation actually happens. So I really appreciate you breaking down the benefits in that. And let's let's transition into crypto, you've got a new division, we call it and it actually actually now have a set up place for all the individuals who want to go into crypto. And so tell me about what's different. How are people able to you use their IRA in crypto?
Yeah, absolutely. So crypto really came online for us, going back to maybe about four years ago when we would get customer inquiries and prospective client inquiries on investing in cryptocurrency. And at that time, we didn't have a platform for investors to invest in cryptocurrency. And, you know, for obvious reasons, IRAs, investing in cryptocurrency from a tax perspective can be highly beneficial. But as a custodian and as a financial institution, we have to make sure that we're putting the proper security in place. And we have the proper risk mitigation, because in the crypto markets, of course, and in the crypto supply chain, obviously there can be there can be risks there for investors. And so we wanted to make sure that if we create a product and a solution, that it takes into account the risk mitigation factors that are necessary. And so we built a technology platform that is fully integrated with our online system, where someone could open an account, fund an account, log in online access a trading platform, and they can buy cryptocurrency, directly through their equity trust IRA and also have the peace of mind knowing that the storage, the exchange the settlement, everything is being done for them. And when I say for them, I don't mean that we're choosing what kryptos for them to buy and sell when to buy and sell sending them alerts or calls. They they totally self direct. But they have the ability to do that all within this integrated system. So in other words, we've brought in the entire supply chain for investors to self direct. All of that being said, we know that some investors prefer to use their self directed retirement retirement plans to maybe invest in sort of a managed type fund or manage type entity trading account. And so there could be instances where an investor would actually use their IRA, and invest in a private placement type offering that might be participating in the crypto marketplace. And so there are those types of instances as well, the long and short of it is equity trust, we're really agnostic to the investments, meaning that we don't take a stance of whether it's good or bad, or when to buy or when to sell, we give the client the freedom to make the decision on when they want to buy when they want to sell, and ultimately, at what level and what degrees, they're participating in the crypto marketplace.
It's good. Yeah, you know, over the last 14 years, you know, 300 plus transactions that we've done with boron capital, we've had some really amazing asset classes that we've invested in, and the ones we're in right now, I would say are the most asymmetrical that they're out there, where the risk is as low as it can possibly be. And the upside is as great as it could possibly be, especially in this season of all the calamity going on on the outside. And so, guys, cryptocurrency is one of those that you may not actually understand how it all works. And I really encourage you to understand, you don't really understand how each of the niches of real estate actually work all the behind the scenes, the management, the leases, the revenue, the actual advertising, the marketing, the maintenance, you don't actually understand it all. So when you come into a fund, a cryptocurrency funds, like our boron digital crypto fund, you actually are under that management platform that John's talking about, which is you're in a private placement memorandum, you're in a private placement fund, a hedge fund that actually is backed by protocols of a portion held in like Bitcoin, and then a portion held in what we call swing trading, where we can actually take control and make sure we maximize profits as the market is shifting. So equity trust is able to hold your your investments that are diversify in self storage, mobile, home parks and cryptocurrency, all of that can be done through equity church, excuse me, equity trust. So super exciting on that. There's so much value when we walk in the wisdom. So just bringing it back to wisdom, everything John's talking about, and how we actually set up our formats of our money, and place it inside a container that has tax rules that actually are massively beneficial, you actually can keep from paying taxes on the wealth that you put in these self directed containers. Guys, this is so powerful if you don't start Now, the question is, when will you start? And so we've talked about how it's, you know, for some people, they're busy, we've talked about for some people, it's like, I don't know what to do was solve those problems with John's walkthrough tutorial of how to actually work through that process. And then boron capital has a direct person who is taking you through that process. Equity Trust has an actual division of a customer service, who's actually taking you through that process. So creates this synergistic smooth process from the beginning to the end. JOHN, I'd love to tie a bow around this with just saying, you know, what you're creating is an opportunity for people to go from the public market, to the private market, where they don't have freedom to where they do have freedom where they don't have control to they do have control, where they can diversify inside the private market. And guys, that's where King Solomon invested he invested in the private market, you would never find King Solomon investing in something he couldn't control. So that private placements that we create through bond capital, you actually have control, you get the tangible assets. And then you can put them in a self directed IRA and have tax free gains, which is a powerful, powerful principle. I'd love to know. I'd love to process through where my audience can find you have got a lot of people who are interested in taking that next step. They want to know you know, how their circumstance and scenario How can they learn more So what's the best place to find you?
Yeah, absolutely. So one resource is our website, our general website, which is trust, etc. COMM so it looks like trust etc.com. And also, you can view us on YouTube, just go to youtube.com and search equity Trust Company, you're gonna find a lot of videos on a variety of different topics, a lot of what we talked about today, and then going into detail on some other items that are broken down based on one's individual specific interest. So YouTube is a great resource, our general website, when you get to our general website, you'll see our phone number, and anyone is welcome to call in. We always encourage folks to call in and tell us a little bit about what your situation is what you want to accomplish. And we have trained associates that can answer your questions and provide the necessary guidance and education. You know, like I said before, we're, we don't take the place of your financial advisor, your CPA or your tax advisor, but we have a lot of knowledge and expertise in the self directed IRA Arena in alternative assets. So you can bounce ideas off of us, and we could be a good thought partner. So those are some good starting points for folks. And I'd really stress for folks to if they want to learn more, to reach out and talk to someone, I've had investors that you know, reach out and they have a half hour conversation. They're like, Oh, gosh, I learned more in 30 minutes from from you and your team than I've learned in 10 years trying to research this on my own. And a lot of that has to do with this is very, very specific to the individual client, we take a very customized approach to to every clients and prospective clients needs. So those are some great resources for viewers to check out and they can get plugged into us from there.
A very good, guys, we'll put that in the show notes. So there are clickable links. JOHN, appreciate your time, man. It's always a privilege to work with you guys hand in hand and look forward to doing more business with you guys in the future.
Likewise, thanks, Blake.
Alright guys, this is Solomon Investor Podcast, signing out to your success. Be blessed.