How you can profit from the 'Rebuilding of America'

In today's blog, I want to address a tremendous financial and social opportunity that is available to anyone with the knowledge I will share and the vision to do something with it. It's the "Rebuilding of America".

What am I talking about?

We are sitting at 'ground zero' for a land/construction development boom that, by the year 2030, will make the build-out following World War II look like "Lincoln Logs". (I assume that most who read my blog are old enough to know what Lincoln Logs are.)

Most state and local governments across the US conduct their own research to estimate trends in demographics, households, markets, and industries in their geographies over the coming years. These projections serve as the basis they use to develop localized growth plans and public policy related to future development requirements for their geographies. However, until recently, there has not been a "national" study conducted to evaluate the development needs for the entire United States.

In December 2004, the highly acclaimed Brookings Institution Center on Urban and Metropolitan Policy supported a project titled "Toward a New Metropolis: The Opportunity to Rebuild America" by Virginia Tech urban planning professor Robert Lang. This is the first study of its kind, whether by government, public or private sources. I will be referencing information from this study and others in today's blog. (Click the Brookings image below to view this study.)

The purpose of this study was to gain an understanding of how projected changes in our nation's population, plus demographic, household and market trends will impact our development requirements for the future. That is: how many new homes, schools, parks, libraries, shopping centers, hospitals, office buildings, industrial complexes, etc, will we need to accomodate future growth?

First, let's start with the 'engine' that's driving the need for future development in the US:

The US population is growing. This is due to:

* Extended life spans (people are living longer)
* New births
* Immigration (legal and illegal)


U.S. CENSUS BUREAU PROJECTIONS:

Year..... Population...... Cume Increase...... Cume % Change
2000...... 282Million.......... ---------------------------------
2010...... 309Million........... +27Million ............. +10%
2020...... 336Million...... .... +54Million ..............+19%
2030...... 364Million........... +82Million ............. +29%

Summary: Between 2000-2030, the US population is expected to grow by >82Million new people (a 29% increase!).

According to the Brookings Institute study noted above:

* By 2030, total "built" square footage in the US (including residential, commercial & institutional, and industrial square footage combined) will need to increase by 42% to accommodate the projected new population growth. That means adding another 127 BILLION square feet of buildings.

* By 2030, approximately 27% of previously existing square footage will need to be replaced. That means another 82 BILLION square feet of re-development building.

* All told, this amounts to 209 BILLION square feet of total development needed between now and 2030.

* Most of the new square footage will be residential space (79%). That's over 100 BILLION square feet of new homes.

* Total projected cost of this new "Rebuilding of America"? $25 Trillion Dollars!

The bulk of the $25 Trillion Dollars will be spent in developing 10 major metropolition regions, which the Brookings study calls "MEGAPOLITANS":

Source: "The $25 Trillion Land Grab" article by Paul Kahlia (Business 2.0 Magazine).
Click on the image below for a copy of the article.

1. CASCADIA: Will encompass land from Seattle to Portland. Vast quantities of cheap, prime greenfield surrounding Seattle, Portland, and Eugene give the Northwest megapolitan explosive growth potential. By 2030 the three metro regions will be intertwined.

2. NORCAL: Will encompass land from San Francisco to Sacramento plus the Central Valley. The action is moving east from the Bay Area: The Sacramento metro region will build more housing and office space in the next 25 years than any other Western megapolitan city except Las Vegas.

3. SOUTHLAND: Will encompass land from Los Angeles to San Diego in the south thru the Inland Empire to Las Vegas in the east. Trade with China through the country's largest port, Los Angeles, will fuel a boom in logistics, warehousing, and distribution centers for companies like Target. New military and space programs will do for the Southland what the Internet did for NorCal in the 1990s.

4. VALLEY OF THE SUN: Will encompass land from Phoenix to Tuscon. This is the smallest megapolitan, but the one with the greatest supply of raw, buildable land at the lowest prices--one reason it will soon be the fastest-growing metro region in the country. The big draw: a Palm Springs lifestyle for the masses at a substantial discount.

5. I-35 CORRIDOR: Will encompass land from San Antonio to Dallas to Kansas City. No region better captures and caters to the Latino population boom. A new generation of Hispanic business owners and industrialists will drive the growth, and the area will become a magnet for foreign firms trying to cash in on the U.S. Latino market.

6. GULF COAST BELT: Will encompass land from Houston to New Orleans. Hurricane Katrina will for decades exaggerate a divide at the Texas-Louisiana border between the region's richer western section and the poorer eastern one. Surrounding megapolitans will enjoy spillover growth because of the Gulf Coast Belt's higher risk premium.

7. GREAT LAKES HORSESHOE: Will encompass land from Chicago to Detroit to Pittsburgh. Hit hard by manufacturing's decline, the constellation of Northern industrial cities is morphing into a service-economy region and will draw a flood of immigrants.

8. ATLANTIC SEABOARD: Will encompass land from Boston to New York City to Washington DC. The country's most heavily populated megapolitan braces for another boom. Where will most of the development go? Up: Urban infill will outstrip suburban growth.

9. I-85 CORRIDOR: Will encompass land from Raleigh-Durham to Atlanta. The 410-mile stretch from Atlanta to Raleigh is fast becoming a contiguous strip of McMansions and McDonald's. As textile manufacturing fades, consumer banking in Charlotte, telecom in Atlanta, and high-tech in the Raleigh-Durham Research Triangle drive the growth.

10. SOUTHERN FLORIDA: Will encompass land from Tampa to Miami. The state posted the nation's highest job growth in 2004, as baby boomers from the North poured in to take advantage of the job market and climate. Land scarcity will drive urban growth.

BONUS: UTAH 'MINIPOLITAN': This is my own addition to the $25 Trillion Land Grab markets. Utah is experiencing tremendous population and job growth and needs to be added to the list.

How can YOU profit from the 'Rebuilding of America'?

Well, I suggest that you find a way to participate financially in the development process, particularly in the 'Megapolitans & Minipolitan' geographies listed above.

Personally, I am investing in a company that specializes in real estate development.

If you would like to learn more about what I'm doing, click on the image below:

That's it for now. See you next time! Retirement Wiz (email me at: johnha7@yahoo.com)

How to avoid running out of money in retirement

I just came across a very informative report that I'd like to share with you today. It's called "The 15-Minute Retirement Plan: How to avoid running out of money when you need it most", prepared by Fisher Investments.

For a FREE copy of this report, click on the image below:

Here's a brief summary of what I believe are key points in this report, plus some of my own thoughts on the subject:

Running out of money is one of the worst things that can happen to a person in retirement. You might work your whole life saving for your future and then find out that you don't have enough money to last for the duration of your life.

To avoid this happening to you, there are several key factors that you need to consider:


1. The length of time that you will need to save for. Many people underestimate their life expectancy. In 1952, the average lifespan was 68.6 years. In 2006, that had increased to 77.8 years. And, with continuing improvements in medicine and healthcare, it's expected that life expectancy will only continue to increase.

What does this mean to you? Expect to live a long time and build this into your savings plan for retirement. Below is a 2006 life expectancy table from the IRS to help you with this.

Age.....Life Expectancy
51-----------84.3
55-----------84.6
60-----------85.2
65-----------86.0
70-----------87.0
75-----------88.4
80-----------90.2
85-----------92.6
90-----------95.5


2. The effects of inflation. Many people believe that if they're earning 10% per year on their portfolio, that they can withdraw 10% per year without reducing their principal. This isn't correct. They forget to take into account INFLATION, which historically has averaged 3% per year. So the real earnings for their portfolio is just 7% per year (10%-3%=7%). If they're withdrawing 10%, they are actually reducing their principal every year.

More on inflation: it has a compounding effect on your cost of living. If you need $50,000 per year today to cover your living expenses, in 20 years you'll need $92,000 to keep the same lifestyle. In 30 years you'll need $125,000. You get the point.

3. The amount of money you withdraw from your retirement portfolio each year. The amount of money that you withdraw each year obviously will affect how long your money will last. Here are three scenarios based on an average 10% annual return on a $1 million portfolio over a 30-year time horizon, adjusted for inflation:


* Withdraw 10% per year: the portfolio will last approx. 18.2 years
* Withdraw 7% per year: the portfolio will last approx. 24.2 years
* Withdraw 5% per year: the portfolio will last approx. 27.9 years


4. The makeup of your retirement portfolio. In particular, if you're heavily into stocks, you must take into account the volatility of the stock market. If you need to take 10% withdrawals each year and take it in a year when the market and your portfolio are way down, you could significantly cut into your principal. To illustrate: if your portfolio has declined 20% this year due to a stock market downturn, and you withdraw 10%, you'll need your portfolio to grow 39% next year just to get it back to even.

What can you do?

I recommend that everyone take a good look at raw land development investments for their retirement portfolios.

Here's why:

Though nothing is certain with any investment, raw land development is one of the most lucrative investment vehicles available to investors. And that includes stocks, bonds, commodities, other real estate products, etc. Professional land developers commonly increase the value of their raw land investments by 200-500%. And it can be much higher. (I consider that pretty lucrative.)

These investments are typically secured by the value of the land being developed. This is in contrast to stocks where there is really no security at all.

Land developers do not rely on market appreciation for their profits, unlike residential real estate. Instead, they CREATE value by taking raw land, obtaining government permits and approvals to rezone the land so it can be subdivided and built upon - then they resell these newly approved lots to production builders for typically 2-5 times more than the land developer paid for the land. So, there is typically far more stability and much less volatility.


To learn more about raw land development investments, click on the picture below:

See you next time! Retirement Wiz (e-mail me at: Johnha7@yahoo.com)

The best places to retire in America

Today, I thought we'd have a little fun and review "the best places to retire in America". As my source of information, I'm referencing articles from US News & World Report dated 9/20/07 and 9/25/07.

Here's the process they used to arrive at their selections for the Top 10 Best:

* They started with a list of 2,000 places with populations of >15,000 people. Their reasoning for this population minimum was that communities smaller than this are less apt to have adequate medical facilities or income opportunities for those who might wish to work a little during retirement.

* Next, they narrowed the field to about 1,000 places based on things like cost of living, crime rate, climate, healthcare, recreation, etc.

* Finally, they selected their Top 10 list from this grouping as Editor's Picks - shown below in no particular order.

NOTE: Click on the pictures beneath each city to go to specific information about that city.

Enjoy!!

> Smyrna, Tennessee:


> Bozeman, Montana:


> Concord, New Hampshire:


> Fayetteville, Arkansas:


> Hillsboro, Oregon


> Lawrence, Kansas


> Peachtree City, Georgia


> Prescott, Arizona


> Venice, Florida


> San Francisco, California


** Remember to click on the pictures above for specific information about each city.


I hope you enjoyed it! Until next time -- Retirement Wiz (email me at: Johnha7@yahoo.com)

Why land development is one of the best investments you can make....period!

Back on March 11, 2008, I wrote a blog titled "A well-kept secret: Investing in Land Development". There, I gave four reasons why everyone should consider investing in land development. Here, I'm going to explain further about why land development is one of the most lucrative investment vehicles of them all -- and that includes stocks, bonds, other real estate products, commodities, precious metals, etc. You name it.

Here goes....

Land development, also known as raw land development, is the process of converting raw or undeveloped land into land that can be used for a higher economic purpose -- i.e. it can be built upon. How does this magical transformation take place?

It's simple, but not easy. The developer obtains the necessary permits from the government and public agencies that are required to give permission to modify the land for a different purpose or use. It's a lot of red tape and can literally take years to complete depending on the size and scope of the project. In addition to being very time consuming, it can require a bunch of legal wrangling, a lot of politics, financial and management expertise and a great deal of patience.

Most developers are rookies and they usually fail because they don't have the relationships or experience needed to do this expertly. Many go into it with a great piece of property, in a great location, with a great idea for the property -- then fail because they couldn't get the necessary permits approved before they ran out of time and money.

The successful land developers are professional companies that do this all day every day. There are very few of these in the U.S., but these are the guys making all the money. They have the relationships with government officials, local business leaders, lenders and builders across the country. In a way, it's a 'good old boy network'. More importantly, they have experience.
So, how do these 'professional' land developers make their money? Well, simply put, they "create value". They do this by conducting a tsunami of research (that's a lot of research) about where population shifts are taking place, where communities are growing to, where jobs are being created.... you get the idea.

Once they have identified where the growth is going to take place (they look years into the future), they then search for raw undeveloped land or property in the path of this growth. Once they identify some raw land to their liking (it could be anywhere from a few acres to thousands of acres), the developer generates preliminary plans for this property in the form of a greater economic use. This could be a shopping mall, a master-planned residential community, an industrial complex, a golf course, etc.

The next step is to obtain the rights to the property. This is another area where non-professional developers often over-extend themselves and fail. The professional developer rarely will pay cash for a property up front and tie up his or her capital. Instead, they will employ modest deposits or 'right to purchase' contracts, etc. to obtain the rights to the property with little out of pocket expense. Meanwhile, a non-pro often doesn't have the knowledge or expertise in this area and they get in over their heads financially, causing them to ultimately run out of money and fail.

Next, the professional developer, will usually contact their network of builder relationships and present their preliminary plans (they might do this even before they obtain the rights to the property) and get a 'handshake' agreement to build-out the project once the government permits are obtained. And from there, the land development project goes into high gear -- meaning the permits and approvals are pursued full-time until completed.

To be clear, a true land developer does NOT build on the land. They simply (but not easily) obtain the approvals to do this. Sometimes, they will install the "infrastructure" - which could be the sewer and water mains, utilities, curbs & gutters, etc. -- but not always. Once they have obtained the permits and approvals, they will then sell the property to the builders and that's the end of their involvement in the project!

You may be thinking, that's it? How could that be so lucrative? Well I can assure you that it is. It is by far the most lucrative form of real estate. The reason is that it takes many years to become expert at what land developers do. I've already told you that most developers fail because they lack experience, so there is a lot of risk if you don't know what you're doing. So, the pros get paid very well for what they do because the builders have confidence that THEIR projects have a great opportunity for success.

One other thing.... Land development isn't susceptible to market fluctuations like residential real estate. Land developers don't rely on appreciation for their profit like builders and residential investors do! As I've illustrated above, the land developer CREATES value by obtaining approval to build on the previously undeveloped land:

A typical land development project increases the value of undeveloped land by 200-500% !! And it can be much greater. I consider that pretty darn lucrative don't you?

Now I hope you can see why any investor who can fog a mirror should consider land development as a component of their portfolio.

In the past, small investors like me couldn't participate in land development projects as investors. As I mentioned above, it's been a 'good old boy network' for many years among the few professionals in the business. So, you had to be know somebody to be 'invited' to invest and even then, you had to have millions to invest or you weren't worth their time.

But that's changed!
Recently, a new type of investment structure was created that now allows smaller investors to participate in this very lucrative field. I sure do!

To learn more, click on the image below:

Until next time! Retirement Wiz (email me at: Johnha7@yahoo.com )

Use your IRA funds to invest in Real Estate tax deferred

For years and years, we've been literally "hoodwinked", "brainwashed", "convinced" by the big financial brokerage houses and banks that our IRA funds can only be invested in things like stocks and bonds and CD's (certificates of deposit) -- products that they sell. However, we are also aware that the stock market is volatile and can decline sharply in just one day - putting our retirement plans on hold until it (hopefully) recovers.

The good news is that we don't have to ride that rollercoaster if we don't want to!

There are investment alternatives that offer far more safety and upside potential: REAL ESTATE products. Yes, real estate! And you can use your IRA funds to invest in real estate products and still retain the same tax deferred status that you currently have with your IRA. You can do that with a self-directed IRA as I detailed in a previous blog (please see my blog archive: "How to take control of your IRA and 401k investments").

OK, let's move past that point as a given for now, alright?

So, I know what you're thinking... The residential real estate market is in foreclosure isn't it? Well, yes it is. Residential real estate is hurting is many areas around the country. I can make a strong case that there are very profitable investment opportunities in this environment for the savvy investor -- in fact, many pros are gobbling up foreclosure properties aggressively right now. WHY?

The answer is: because residential real estate is cyclical. Remember the 1980's? So soon we forget. We've been there before and done that, right? The dynamics are different this time around with the sub-prime lending issues, but the cycle will win the day and here's why......

The U.S. Census Bureau projects that the U.S. population will balloon by >111 Million new people between NOW-2050. That's a 36% increase! And where are all of these new people going to live?? That's right, they'll need houses, schools and communities to support them.

It's all about Supply and Demand. The population growth quoted above represents increasing demand. Today, we have more supply than warranted -- we're over-built with homes, but that's going to change in the next couple of years as the population swells and demand outstrips supply of homes.

Since we're talking about retirement investing, we're also talking about patience and growth potential in connection with our investments. I can't think of another investment category that offers better potential than real estate for the coming decades.

The Brookings Institution Center on Urban and Metropolitan Policy released a paper (44 pages) in Dec. 2004 titled "Toward A New Metropolis" - The Opportunity To Rebuild America." This document was summarized in an article published by Business 2.0 on CNN Money.com in Nov. 2005 titled "The $25 Trillion Land Grab." It states that we are on the groundfloor of the biggest "land grab" since the build-out after WWII. It goes on to identify 10 geographic areas around the U.S. where this "land grab" will be taking place. The fact is that this is taking place RIGHT NOW. Professional developers and investors are quietly and aggressively acquiring raw land in these key markets ahead of the "path of growth". (Click on the image link below to view the article.)

What does this mean for you and me as investors? Well, a couple things:

1) We know that the population is going to grow significantly creating more demand for homes and land development.

2) We also know geographically where that growth is going to happen.

So, as investors, we can choose to capitalize on this opportunity or not. I've made the choice of capitalizing on the opportunity. If you would like to know how, click on the image link below.

In future blogs, I'll be sharing a number of real estate investment products that you can invest in using your IRA funds. These will range from products with immediate cash flow to products with longer term profit potential -- and some with both.

Until next time..... Retirement Wiz (email me at: johnha7@yahoo.com)

A well-kept secret: Investing in Land Development

The wealthy have been doing it for years....

You've probably never heard about this opportunity...

Your financial advisor certainly won't be telling you about it...

What am I talking about??? RAW LAND DEVELOPMENT INVESTING

Raw land development is widely regarded as the most lucrative form of real estate investment. In fact, land development is one of the most lucrative investment vehicles available (and that includes stocks, bonds, commodities -- you name it).

200-500% increases in land value are common returns for professional land developers. (And, they can be even greater.)

Q: What exactly is raw land development?

A: Simply put, it is the process where raw, unimproved land is acquired by the acre and governmental approvals are obtained to prepare the land for building upon. This newly "improved" land is then resold to building contractors in surveyed lots and parcels.

Why should anyone consider raw land development as an investment?

1st, as I already mentioned above, it can be very lucrative. Who wouldn't want to share in these 200-500% potential returns? However, until recently you had to have millions of dollars to invest to even be considered as a potential investor -- and, even if you had the money, you had to be "invited" by a developer in order to participate. BUT THAT HAS CHANGED, as I'll explain a little later.

2nd, because these investments are typically secured by the value of the land that's being developed -- which is in contrast to stocks, for example, where you really have NO security at all on your investment.

A 3rd reason to consider land development is because unlike residential real estate, which we all know is in foreclosure in many markets, raw land development is aggressively expanding, particularly in 10 key markets around the U.S. In fact, it's widely held that we're on the ground floor of the largest "land grab" since the build-out following WWII. (Reference: "The $25 Trillion Land Grab", Business 2.0/CNN Money.com - NOV. 2005) -- click on image link below:

A 4th reason is because the population is projected by the U.S. Census Bureau to balloon by over 111 MILLION new people between NOW-2050 (a 36% increase in our population). And these new people will require new homes, schools and communities to support them, which DICTATES more land development!

At the end of the day, it's all about supply and demand. The demand created by the population growth will need to be supplied by more and more land development.

Guess what? It's happening right now! As I write, in the 10 key markets detailed in the article mentioned above, raw land is quietly and aggressively being acquired for development now and into the coming decades.

As I mentioned above, in the past, you couldn't participate in land development investing without millions to invest and an invitation from a developer. I also, mentioned that something has changed all that. What is it?

Well, several years ago, a new investment structure was developed, now allowing smaller, accredited investors who don't have millions to invest, but who want to participate in the 200-500% value increases possible with land development investments.

To learn more, click on the image link below:

Until next time, Retirement Wiz (email me at: johnha7@yahoo.com)

Have some fun with Penny Stocks

I don't have a lot of time today for my blog, but I wanted to share a fun topic: Penny Stocks. If you have some spare time and you're a bit of a gambler, this can be an enjoyable venue for you.

I got started playing with penny stocks a few years ago. Basically, they are stocks priced under $1.00 per share - hence the name "penny" stocks. I own some that cost LESS than $0.01 per share!

Why would you gamble on penny stocks (and that's exactly what you're doing)??

Well, first of all, it's fun to buy these and watch what they do. Second, there's always the chance that you'll pick one that could turn into the next Microsoft.

And there are tons of them out there to choose from. All you need to do to find ideas on stocks is to Google the terms "penny stocks" or "hot penny stocks" and you'll find dozens of sites providing tips. Here's a link to one I just checked out this morning:

http://www.thehotpennystocks.com/

Now, I caution you on a few things:

1) I haven't made a penny with my penny stock portfolio - so I won't share my personal picks with you unless you ask me to do so.

2) This is like Vegas or Atlantic City, unless you can afford to lose the money, don't play the game.

3) This can be addicting! Like I said, it's basically gambling. And, it's kind of cool to say "I own 1 Million shares of this company!"

If you're interested, here's a link to a FREE online book by penny stock guru Peter Leeds titled "Understanding Penny Stocks:

http://www.pennystocks.org/

To get started you WILL need an online trading account. I use E*Trade, but there are a number of others to choose from like ScottTrade. These have low commissions (you have to pay a commission for each buy or sell order that you make - ranging from about $7-$13 depending on the company you choose). Here are the image links below to E*Trade and ScottTrade:

It's simple to set up an online account with these companies. They will require a deposit (I believe E*Trade requires $1,000) to get you started trading. Once you're set up with an account, you just need to type in a stock ticker symbol (e.g. GOOG is the symbol for Google - but it's definitely NOT a penny stock). Then, you need to decide how many shares you wish to buy. You'll also be asked to choose how long your buy offer is good for (e.g. one day only, one week, 60 days, etc.) and you'll be asked if your offer is a "market" offer or a "limit" offer. A "market" buy offer means you'll pay whatever the market price is at the moment you submit your offer. The "limit" offer means that you can set the price you'll pay (it can be under the current market price). I always use the limit offer because I'm in control of what I'll spend. However, if you feel like you just have to have a stock right away, the market offer is the way to go.

Those are the basics. Honestly, I didn't read any books beforehand, I just waded in and learned as I went. I didn't even have the weak advice that I'm providing here to go on.

Anyway, I hope I'm not turning people into gamble-aholics with this blog. Just have fun with it and who knows? You could be the next Warren Buffett!

Until next time. Retirement Wiz (email me at: johnha7@yahoo.com )

How to take control of your IRA & 401K investments

For most of my adult life and working career, I let my 401K and IRA fund managers invest my money as they saw fit. I believed that they were paid professionals and would seek out the maximum returns possible to build my account. And, to a point, that's true. However, these fund managers can only work with their own proprietary investment products. In other words, there are a lot of investment alternatives out there that they can't include in MY 401K or IRA portfolio.

It took me a long time to figure this out. I just assumed that my best interests were being served. If the stock market took a licking and my 401K didn't drop as badly as the overall market, I felt like I was doing good.

Then I came across a phenomenon called "self-directed IRA's". They aren't new to the planet, they were just new to me (they've been around for >30 years).

What are they? Self-directed IRA's are legally no different than any other IRA. The difference is that you choose the IRA's investments from a much broader set of alternatives. You have much more flexibility and control.

Basically, to set up a self-directed IRA, you need a third party "custodian" for the assets of your IRA. There are two classes of companies legally allowed to hold IRA assets:

1) Banks: (banks, trust companies, savings & loans, and credit unions).
2) Non-bank custodians separately licensed by the IRS (broker-dealers, mutual fund companies, and insurance companies).

There are about 20 self-directed IRA custodians available in the US. The one I use is PENSCO Trust Company (they fall under class 1 above). PENSCO has been around since 1989. They service customers in all 50 states. Their corporate offices are in San Francisco, but their Trust Company offices are in New Hampshire. They are regulated by the IRS, the NASD (Nat'l Assoc. of Securities Dealers), the US Securities & Exchange Commission and a state banking commissioner. I felt that was good enough oversight to help me sleep at night knowing my funds were safe. Plus, they are excellent communicators and very efficient. You can check them out at the image link below -- also, be sure to download their FREE ebook "Answers to Investors' Top 50 Questions About Self-Directed IRA's from the image link below:

Self-directed IRA's are growing rapidly in popularity, but they still only represent about 3% of the IRA funds invested in the US. However, people like me are catching on and word is spreading.

The initial concern I had was: is this legal and legitimate? After doing my homework, I clearly found the answer to be a resounding YES. But you'll be surprised how many people, including professionals like attorneys, bankers and accountants who still aren't familiar with self-directed IRA's.

What really sparked my interest was the fact that I could still invest in the securities like stocks and bonds that my old fund managers were investing in if I wanted to, plus things like Certificates of Deposit, annuities, mutual funds, etc. -- but I could also invest in a whole new spectrum of investment vehicles. These include things like raw land development projects, rental properties, trust deeds, tax liens and tax lien certificates, new or existing businesses, commercial property, race horses, airplanes, billboards, fishing rights in Alaska, foreign real estate, etc. There are some restrictions, as there are on any investment type. For example, all of these must be handled as investments and can't be for personal use (e.g. you can't live in a rental property owned by your self-directed IRA).

There are a few assets that you CANNOT invest in with your IRA

Life insurance contracts
Collectibles (cars, stamps, furniture, rare coins, etc.)
Capital stock in an "S" corporation

Anyway, I recommend that EVERYONE at least check out self-directed IRA's. With the stock market gyrations these days, it's worth exploring your options.

See you next blog. Retirement Wiz (email me at: johnha7@yahoo.com )

Is your Financial Advisor lying to you?

What investment opportunities is your investment advisor NOT telling you about?

I'm a little past middle-aged. Up until a few years ago, I managed my retirement investments from a distance. A loooong distance. I figured that was what my fund manager was paid to do. They're the experts right? They're looking out for my best interests right?

Once I woke up and finally realized that I needed to take control of my future, I started surfing on the internet and one day a stumbled across a "Retirement Calculator". I was curious about this because the finish line to retirement is getting closer and closer, so I started filling in the blanks on this calculator to see where I stood.

Well, talk about a MAJOR wake-up call! In short, this calculator told me in no uncertain terms that I wouldn't have anywhere near the amount of retirement income that I would need based on my savings and current retirement investments. It really scared me. I was afraid that I couldn't afford to retire -- certainly not when I wanted to.

What was I going to do? I needed serious retirement help. So, I started studying everything I could find about investing: books, tapes, CD/DVD's, seminars, workshops - you name it. And guess what?

I found out that my 401k and IRA funds didn't offer some of the best investment alternatives available! The glaring omission was real estate secured investments. Products like raw land developments, high-yielding real estate-backed notes, trust deeds, income-producing properties from rental homes to commercial buildings, tax liens and tax certificates, etc. These include some of the most LUCRATIVE investments available and I didn't know anything about them and didn't have access to them.

Q: Why wasn't my investment advisor telling me about these investment options?

A: Because they only earned commissions on the stocks, bonds and various other mutual fund products that their company offered and managed for my little IRA and 401k accounts.
(Notice that I wrote this in the "past tense" -- they are no longer managing my retirement funds.)

Bottom line: financial / investment advisors deal primarily in stocks, bonds and the occasional REIT (real estate investment trust) or TIC (tenancy in common properties) -- but largely NOT in real estate.

So what did I do? I took control of my retirement money. I transferred my funds into a Self-Directed IRA Account. Now I can invest in the same investments and funds as before BUT I can also invest in a whole spectrum of new alternatives: real estate backed investments like land development, businesses, etc.

Here's a link to a FREE e-book with 50 FAQ's (frequently asked questions) concerning Self-Directed IRA's -- click image below:

More to come on this in future blogs. In the meantime, if you'd like to check to see if YOU can afford to retire, click on the link below for a FREE 5-Minute Retirement Calculator (Courtesy AARP):

'Til next time. Retirement Wiz (email me at: johnha7@yahoo.com )

Initial thoughts from Retirement Wiz

This is my opening act. I'm brand new to blogs, so here goes....

Six or seven years ago as a mid-level manager for a major int'l conglomerate I burned out. I was too young to retire, had no immediate plans on what I wanted to do - but I resigned anyway. I know it sounds dumb, but that's what I did.

So, I embarked from there on an adventure spanning numerous failed business ventures as a self-employed nobody. I even took on partners twice in two separate ventures since that time and those failed as well.

Then, one day I guess I woke up and realized that my large nest egg wasn't so large anymore and I'd better get serious about my future. I wasn't getting any younger and needed to find something that would pay the bills now and in retirement - which I knew I couldn't afford.

It's weird - but one night I couldn't sleep, so I turned on the TV in the middle of the night and started watching Public TV here in Southern California and they had a guest named Robert Kiyosaki (of Rich Dad, Poor Dad fame). At the time, I'd never heard of Mr. Kiyosaki but I was honestly inspired by what he had to say. So, in support of the Public TV fundraising offer, I ordered a set of CD's. Next, I went to one of the Rich Dad seminars, bought some books and more CD's, etc.

Here's an image link to the Rich Dad website for anyone interested:

To make a long story short, I learned a lot about investing and more importantly, I learned that I still had much more to learn. So, I started to educate myself more and more (and still do). I read just about everything I can get my hands on the subject. I surf the web for information. I attend free and paid seminars. All about investing in its various forms.

One of the key things I learned along the way that many people like me probably aren't aware of is the fact that you can use your IRA and 401K funds to invest in a LOT more things than are offered by the fund managers. For example: Real estate! raw land, land developments, rental houses, trust deeds, tax lien certificates, local businesses, and much more.

I was literally amazed to learn this. Why didn't I hear about this before? The answer is simple really: Fund Managers and Financial Advisors don't make any money or commissions if you invest in these alternatives outside of their stocks, bonds, and occasional REIT (real estate investment trust) funds.

Anyway, you absolutely CAN use your IRA and 401K funds to invest in alternative investments such as Real estate, etc. through a self-directed IRA and it's very simple to set up. You simply contact a quality self-directed IRA custodian and they walk you through the steps. I use a company called Pensco Trust Company. Here's an image link to their website if you want to learn more:

By the way, I don't make any money by sharing these sites with you. This is simply my way of offering what I've learned and I hope that it might help someone else.

Anyway, that's it for now. I hope my first blog was OK. I'll expand on some of these thoughts in future blogs. Regards! Retirement Wiz

(email me at: johnha7@yahoo.com )