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Top 5 Self Directed IRA Tips That Will Make You Rich During the 2020 Recession - YouTube
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the top five self-directed IRA tips that
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will make you rich that's today's show
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let's dive into it through yard our very
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first rental property
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hey everyone I am Clayton Morris
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longtime real-estate investor and on
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this channel we teach people how to get
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rich without having to quit their day
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job unless of course they want to I
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retired at 40 years old from my day job
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thanks to passive cash flow from real
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estate investing and I built this
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channel to help you do the very same
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thing so go ahead and hit that subscribe
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button that little Bell notification
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Dinges down there so you'll be notified
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when we publish a brand new video
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all right let's talk about one of my
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favorite topics the self-directed IRA
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now if you if you think it out properly
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the self-directed IRA investments can
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maximize a retirement fund as well as
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provide the opportunity to become very
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wealthy this is where seeking out the
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best self-directed IRA tips comes into
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play now your retirement funds growth
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potential can become virtually unlimited
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when you use certain investment
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strategies so with this in mind we've
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compiled a list of five top IRA tips
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that can help you gain financial
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independence and allow you to fully
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enjoy those retirement years so what is
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a self-directed IRA let's start there
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first
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Before we jump into our helpful tips we
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thought a self-directed IRA definition
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was in order for those of you who are
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new to this game self-directed IRAs
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otherwise known as syndra's allow for
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more control over a retirement funds buy
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and sell decision so for instance when
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utilizing a traditional IRA you know
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typical investments might include stocks
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bonds mutual funds CDs and the like and
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as a result an investor's funds may be
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at the mercy of a volatile stock market
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so in contrast investors who want more
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control and direct access to their IRAs
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may invest in alternative assets
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investors still must follow certain
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self-directed IRA rules but for the most
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part they have more freedom to invest as
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they see fit okay number one start your
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self-directed individual retirement
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account early if you can
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now if you currently do not hold a
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self-directed IRA we suggest that you
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start investing in one as soon as
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possible this self-directed IRA tip is
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valuable when it comes to securing a
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comfortable net
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that you can depend on later in life and
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it's really common for younger younger
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individuals that are in their 20s and
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30s to not realize the importance of
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investing in their future they think
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they're kind of invincible as they
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approach the age of retirement then they
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regret not starting their retirement
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investment plan earlier in life by then
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unfortunately it might be too late so
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one of the top advantages of starting
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your self-directed account early you get
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that compound interest because you're
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investing in a self-directed IRA early
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in life it also helps you reap the full
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benefits of that compound interest this
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essentially allows you to earn interest
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on interest you have already earned to
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explain it a little further it's when an
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investment earns a return and then these
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interest earnings are automatically
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reinvested and they start growing the
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fund on its own this coupled with the
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fact that self-directed IRAs are tax
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deferred it's gonna allow your funds to
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grow more rapidly over time
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all right tax breaks starting early will
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also allow for significant tax breaks
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each year that your self-directed IRA is
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in place so for instance you can deduct
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your self-directed IRA contributions
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from your taxable income this will
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lessen your tax burden and therefore
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allow you to save a considerable amount
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of money over the years if you need
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advice on how to lower your tax burden I
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highly recommend Tom wheelwright he
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handles all of our personal taxes over a
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wealth ability he's also the tax advisor
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to many world-renowned real estate
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investors or you can obtain expert tax
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advice right from his book it's called
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tax free wealth we'll have a link below
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self-directed IRA tips such as this one
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can be simple to implement and it's
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gonna yield a significant result
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starting early can also mean the
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difference between working a part-time
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job in your retirement years like a
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Walmart or retiring comfortably number
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two on my list choose a self-directed
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IRA custodian carefully selecting a
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capable and trustworthy self-directed
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IRA custodian is essential when it comes
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to properly growing your retirement
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funds now if you're unfamiliar with that
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term a custodian simply holds the
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self-directed IRA assets as well as buys
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or sells investments on behalf of the
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client experienced con so D ins are
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capable of dealing with the complexity
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of a set of a self-directed IRA so
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they're gonna be aware of wise and
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investment choices and those prohibited
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transactions that we'll talk will touch
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on many new investors assume that a
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fidelity or Vanguard self-directed IRA
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will be the best route to take after all
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they're reputable companies right
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however they do not offer truly
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self-directed iras they mostly deal in
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investments such as stocks bonds and the
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like therefore companies such as these
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typically do not allow IRA investments
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such as real estate and other
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alternative assets gets an insight as to
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why a majority of these financial
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advisors don't talk about self-directed
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IRAs I mean it's true and when you think
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about it ask your fidelity custodian and
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talk to them about this say will you
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allow me to invest in real estate
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they'll get back on the phone with you
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and likely say something like sure you
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can invest in a REIT and are EIT
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a real estate investment trust but
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that's not real real estate you are
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removed from the asset and they're
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effectively lying to you telling you
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that you can invest in real estate
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stocks not actual real estate so be very
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careful that they'll try to keep you in
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that nest and not allow you to fully go
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out into the world and self-direct on
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your own very very important at our
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company morris invest we are able to set
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up a self-directed account in just a few
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minutes so if you're interested in
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working with one of our custodians that
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we've vetted personally call us right
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now I'm Kota Morris and Vess calm and
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set up a time to talk with us and we'll
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walk you through that entire process
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because it's incredibly important on
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different levels of expertise making
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sure that the company that you're
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working with as a custodian actually
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holds and protects your account not just
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an administrator or facilitator you know
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ask for an overview of their latest
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self-directed IRA tax rules if any this
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is gonna allow you to see if they are up
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to date with a pertinent tax loss
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inquire about the types of assets that
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they hold as well as the number of
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clients they're currently serving this
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is gonna give you a general idea if the
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company is limited as to what they can
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be able to handle or if they offer a
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full scope of self-directed IRA services
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so you know you can conduct your
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research using the Better Business
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Bureau as well as reviews to check their
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track record but again you can book a
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call with our team
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and we'll take care of you on the
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self-directed IRA set up front
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number three diversify with lucrative
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self-directed IRA investment assets so
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asset diversification is one of the most
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popular reasons that many investors
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prefer to self-direct their IRA being
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able to invest in more than just stocks
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bonds mutual funds CDs it opens up an
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opportunity to use your special
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interests and expertise to maximize your
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retirement funds so in addition to this
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when you utilize other investment
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avenues you can protect your retirement
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funds from the ups and downs of the
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crazy stock market so I want you to
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avoid a stock market downturn by
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diversifying inside of a self-directed
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account you can keep your funds locked
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up in an account that is at the mercy of
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a stock market it's unpredictable right
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we know it's an unpredictable investment
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strategy there's a great possibility
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that you could lose a quarter half or
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almost all of your savings if that
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market crashes this has happened before
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and it can happen again you don't have
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to put all of your eggs in one basket
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you can diversify with a self-directed
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IRA to keep your retirement funds safe
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from the volatile stock market another
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point is allowable self-directed IRA
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alternative investments for
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diversification so diversifying by
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investing in allowable alternative
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assets is a self-directed IRA tip that
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can certainly make you rich additionally
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it's going to allow you to deal with
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investments that you have knowledge of
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for instance if you're a rental property
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investor like I am and you're wondering
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can I buy real estate with my IRA the
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answer of course is yes just as long as
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it's self-directed land purchases are
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also allowable if they meet certain
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criteria crypto currencies and other
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digital money as well as precious metals
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gold silver and the like are also
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included in the list of allowable
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self-directed IRA investments it's a
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mouthful so as you can see this opens up
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a world of opportunities for you the IRS
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states that collectibles life insurance
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and self benefiting items such as a
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personal property that you plan to live
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in are not allowable investments okay
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those are prohibited however there is
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much that you can invest in so here's a
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list of the most popular
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alternative investment opportunities
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real estate raw land oil and gas
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precious metals digital currencies LLC
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membership promissory notes startup
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businesses tax liens all right number
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four on my list acquire financially out
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of reach assets with Co investing now Co
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investing is one of the more creative
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self-directed IRA tips that allows for
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investing in assets that you might not
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have the funds to invest in yourself
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this comes in handy with more expensive
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assets such as real estate so you make
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Co invest your self-directed retirement
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account funds with another self-directed
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retirement account
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this could include self-directed
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retirement accounts that belong to your
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others your spouse your family members
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as well as your partnering IRAs you can
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up open up various investment
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opportunities that can build great
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wealth partnering these accounts Co
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investing with your family members is a
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really powerful tool although you may
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co-invest with your spouse and other
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family members each lineal descendant is
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a disqualified person when it comes to
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buying selling or lending to or from
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them however however you can proceed to
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do business and co-invest with these
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individuals if you're dealing with a
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third party for example a husband and
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wife can Co invest their self-directed
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iras
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to pool enough funds to invest in rental
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property that they are purchasing from
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an unrelated property owner so if you're
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thinking of co investing with someone to
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purchase a rental property we were we
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highly recommend that ensuring that the
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deal will be profitable by simply
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running through the numbers and you can
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check that out at deal checks which is a
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property analyzing software we have the
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link below to that you can also partner
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with your own IRA now if you have
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multiple IRA accounts you make co-invest
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with yourself when doing so you must
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avoid self dealing situations so this is
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when an investor receives personal gains
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from the retirement fund transactions
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when this occurs the investor may
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receive penalties as well as Oh some
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taxes so self dealing examples include
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personally residing in a house that you
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bought with your self-directed IRA don't
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do that buying digital currencies from
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yourself don't do that taking a salary
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from your self-directed account don't do
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that and so on so if you'd like to
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co-invest with yourself speak with your
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to obtain a list of self dealings that
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you want to avoid
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you can also co-invest through an LLC
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sometimes co-investing through it LLC
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just makes sense so investing through an
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LLC means that the IRA owns the LLC and
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the LLC would then have ownership of the
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investment this is especially beneficial
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when using your self-directed IRA to
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invest in rental property so when
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utilizing your LLC the tenant pays their
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rent into one of the payment LLC's so in
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contrast if the LLC did not exist the
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tenants would need to pay each
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co-investors IRA separately there'd be a
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pain in this case forming an LLC is a
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much more efficient way of doing
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business and when you form that LLC it's
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best to seek the advice of someone who
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has experience setting up corporate
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structures and we recommend contacting
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the folks over at corporate direct com
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you'll save 100 bucks if you mentioned
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that we sent you number 5 consider a
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backdoor Roth IRA contribution before we
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dive into the backdoor Roth IRA let's
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talk about what the basics of a
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self-directed Roth IRA entails in
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general it's a retirement account that
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differs from a conventional IRA and that
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you can't write it off or take advantage
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of tax deductions from your
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contributions but at the same time your
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earnings are tax-free with a
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self-directed Roth IRA even when you
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withdraw them during your retirement
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years now this is an exceptionally smart
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investment strategy because tax rates
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may go up by the time you retire the
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bottom line is that a self-directed Roth
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IRA allows you to withdraw your savings
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without owing taxes so what is a
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back-door roth IRA contribution well
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although a self-directed Roth IRA sounds
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like a perfect investment strategy there
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is a significant issue the IRS has set
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certain restrictions on who can
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contribute to a Roth IRA plus they've
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also set limits on how much money you
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may add to your account so for 2019
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single individuals with an adjusted
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gross income of a hundred thirty seven
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thousand or higher as well as
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individuals who are married filing
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jointly with an income of two hundred
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and three may not open a Roth IRA
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additionally those who are allowed can
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only contribute six thousand per year or
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seven thousand if there
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over the age of 50 now to get around
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these restrictions the backdoor Roth IRA
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comes into play it's a solution or a
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legal way for higher income earners to
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open and contribute to a Roth IRA it
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also allows for surpassing those
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contribution limits the basics of how to
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set up a self-directed Roth IRA entails
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placing money in a traditional IRA or
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self-directed account the account is
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then rolled over into a self-directed
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Roth IRA you have to pay taxes after you
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convert it to a Roth account but it's a
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one-time deal I did this in sum this is
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one of the clever most smartest legal
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ways of doing this in order to bypass
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these rules and go through the backdoor
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so if you convert a certain IRA to a
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Roth you're gonna be expected to report
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it to the IRS using the backdoor Roth
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IRA form 80606 so make sure you follow
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the letter of the law all right that was
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a lot to digest I want you to utilize
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these self-directed IRA tips to become
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rich and enjoy your retirement if you're
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new here to the channel please go ahead
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and hit subscribe we've got hundreds of
[866]
videos here to help you build wealth to
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get started with real estate investing
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and if you would like help setting up
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your self-directed account and start
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investing in real estate today with
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brand-new construction properties give
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us a call you can book a call right
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there on your screens it's by going to
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Morris invest calm the link is below and
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we'll jump on the phone with you for 30
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minutes and help you get set up
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alright everyone until next time go out
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there and take action become a real
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estate investor I believe it's the
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number one way to build wealth we'll see
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you next time
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