Many of us dream of the day we can be our own boss and run our own business. This is a common, American dream that many of us share. Starting and running your own business is not for everyone and access to capital and enough capital are crucial for success in starting and running your own business.
Today's current credit and economic environment is causing large numbers of companies to struggle for credit and capital to maintain their businesses. The current credit and capital access problems are strangling companies and are resulting in layoffs and closing of small businesses.
There's an answer...
If you happen to be caught in the current credit and economic crunch as an employer or an employee, there are answers. NAFEP is a leading provider of self directed IRA and 401(k) solutions that enable existing or new businesses to tap retirement funds for capitalization.
The NAFEP mySOPTM is designed to have a profit sharing plan created for your new or existing business. mySOPTM is our trademarked term for “my Stock Ownership Plan”. The mySOPTM allows you to rollover retirement funds into your company's plan and purchase stock in your own C-Corp. The purchase of stock allows your retirement plan to become a shareholder in your corporation and this in turn provides new capital to your current or existing business.
How does the self directed 401k work?
Create Entity (LLC or C-Corp). NAFEP will create the entity with the appropriate state.
Create the Plan (Trust with Plan documents). NAFEP will create the Plan and file with the IRS.
Rollover monies from IRA or 401K to your one.K.
Setup Checking Accounts for the Company and the Plan.
Direct Investments by purchasing membership or stock in a company (your C-Corp or another entity).
Self Directed 401K (one.KSM) Benefits:
401K Plans do not permit direct ownership of real estate or other non-traditional investments in an 401K, so indirect investment via the self directed 401K (one.KSM) is the only choice.
When a (one.KSM) (Self Directed 401K) sells real estate or other investments, the capital gains are deferred through the 401K, like any other 401K investment. The headaches of 1031 exchanges are never necessary.
Ownership of the property in a one.K allows you, as manager, to have direct, hands-on control of and investment decisions over one.K assets, including control of the checkbook. Custodian involvement and hassles are eliminated, regardless of whether the investments are in securities, real estate or other assets.
A one.K can use its 401K funding as a down payment for a real estate purchase, with the one.K financing or borrowing the balance. The use of debt financing for real estate is not subject to UBIT tax.
Since you control and handle all one.K transactions, and act as the "custodian", then there are no expensive annual fees.
Litigation threats which accompany investments such as real estate are substantially reduced. This is done by isolating the investment inside a title holding company or Trust holding company, and away from the rest of your 401K funds and estate.
Continues to provide deferral of income and gains inside the 401K.
If the company sponsoring the plan generates income, then you can make contributions of up to $45,000 annually to the 401K plan ($15.5K for employee and $29.5K for employer for the year 2006)
Uses for a mySOPTM /Self Directed 401k Plan
Purchase real estate
Loan to yourself or others
Buying or starting a business
Use purchase options on real estate
Flip properties
License intellectual properties
How Can I Learn More?
If a self directed 401k plan with a mySOP, sounds like something that could help you start a business or your current business go to our website and our presentation:
I'm glad you're helping to get the word out on self directed's.
When I talk to people about it they usually look at me like a dog that's just been shown a card trick.
As invesotrs, we utilize our private lenders self-directed and pay excellent interest rates. Everyone wins. One of our first clients has most of his retirement with us and we like to say that "We are helping Joe to retire."
In this economy, you have to charge of your finances and not leave it in the hands of a bunch of Muppets.
Posted by: Brett | February 16, 2009 at 04:04 PM