In a candid and eye-opening episode of the “Raising Private Money” podcast, Jay Conner welcomes Carter Lane, CEO and founding partner of Unified Wealth, to share powerful insights about self-directed IRAs and why they’re a vital tool for anyone seeking true control over their financial future.
For too long, conventional wisdom about retirement has convinced everyday investors that Wall Street knows best. Most Americans place their faith—and life savings—in traditional vehicles like IRAs and 401(k)s, trusting that stock market growth and a menu of mutual funds will be enough to secure a comfortable retirement. But Jay and Carter challenge this narrative head-on, urging listeners to rethink the risks and question who really benefits from the status quo.
Carter Lane brings more than two decades of real estate and private investing experience to the conversation, but his passion for this mission is deeply personal. After witnessing his own mother lose her retirement savings in the financial crash of 2008, Carter made it his mission to protect others from a similar fate. He has since helped thousands of investors move more than $100 million into self-directed retirement accounts, empowering them to invest in what they understand—like real estate, private lending, and other tangible assets.
Jay Conner reflects on his own journey, explaining how the 2008–2009 banking crisis abruptly cut off his access to traditional financing. This forced him to uncover the world of private money and, more importantly, the unique advantages of self-directed IRA companies. These experiences frame the day’s discussion: What exactly are self-directed IRAs, and why are they an essential tool for anyone who wants to build wealth outside Wall Street?
Carter lays out the basics for those new to the concept. A self-directed IRA is a qualified retirement plan—just like a traditional IRA or 401(k)—but with an important difference: The account holder is in control. Instead of being limited to a strict list of stock-based investments, individuals can roll existing retirement funds into a self-directed IRA and invest in a much broader range of assets, such as real estate, private notes, and more. This control allows for greater diversification and returns, all while maintaining the same tax-advantaged status as conventional accounts.
The podcast discusses why so few people know about these options. As Carter explains, the self-directed IRA has actually been part of the tax code since the 1970s, but large brokerage firms and financial advisory businesses have little incentive to promote it. Traditional custodians don’t profit when their customers move funds into self-directed accounts, so they rarely educate their clients about them. Jay observes that most investors, even savvy real estate professionals, only discover self-directed IRAs when someone takes the time to educate them about private lending.
The conversation makes it clear that relying exclusively on Wall Street comes with hidden costs. Not only do investors give up control, but they are also subject to significant management fees, which Carter points out can erase as much as 63% of total gains over the life of an account. More importantly, market swings beyond an individual’s control can destroy carefully built savings overnight.
Transitioning to a self-directed IRA, however, is remarkably straightforward. Carter Lane’s firm helps clients roll over funds from other retirement plans—whether an old 401(k) or a traditional IRA—into a new account that’s attached to a checking account, providing what he calls “checkbook control.” This means clients have direct access to their funds for investing, without middleman approval or extra fees. The only IRS limitations are investments in collectibles and life insurance, leaving investors free to pursue real estate, notes, or any asset they believe in.
For high-level real estate investors and business owners, Carter discusses advanced strategies like using a Solo 401(k) to contribute up to $72,000 per year—minimizing tax liabilities and generating tax-advantaged growth that can be invested back into their deals.
Jay Conner closes the episode by urging listeners to break free from the outdated, fee-laden world of Wall Street. By taking control of their retirement dollars with a self-directed IRA, investors can not only grow their wealth but ensure they, not someone else, are in the driver’s seat of their financial future.
If you’re ready to explore the possibilities, Carter Lane encourages scheduling a call with Unified Wealth to learn exactly how a self-directed IRA can work for you. It’s time to retire with freedom—and peace of mind.
10 Discussion Questions from this Episode:
- According to Jay Conner and Carter Lane, what is the most significant misconception about Wall Street’s role in managing retirement accounts?
- Why are self-directed IRAs considered to provide more control over retirement funds compared to traditional retirement accounts, as discussed at?
- Based on Carter Lane’s story about his mother’s experience in 2008, what are the real risks of depending solely on traditional 401(k)s and IRAs for retirement?
- What fees are associated with traditional retirement accounts, and how do they impact the overall returns for investors over a lifetime?
- Carter Lane highlights that only about 3% of retirement funds are self-directed. What reasons did he give for why more people aren’t utilizing self-directed accounts?
- Jay Conner mentions that most of his private lenders had never heard of self-directed IRAs before he educated them. How can increased financial education benefit both investors and those seeking funding for real estate?
- What are the steps involved in transferring retirement funds from a traditional IRA or 401(k) to a self-directed IRA, and why is it described as the “easy button” approach 20:08?
- Discuss the main fears or misconceptions people have about self-directed IRAs. Which of these does Carter Lane identify as simply untrue?
- What advanced strategies involving self-directed IRAs and solo 401(k)s are available specifically for real estate investors or business owners?
- Why do Jay Conner and Carter Lane believe that self-directed retirement strategies could be “costing” business owners hundreds of thousands or even millions of dollars over time if they aren’t utilized?
Fun facts that were revealed in the episode:
- Self-directed IRAs have been around just as long as traditional IRAs. According to Carter Lane, both the self-directed IRA and the traditional IRA were created on the same day in 1973, but Wall Street shone the light only on the traditional version.
- Over half of Jay Conner’s 47 private lenders fund his real estate deals using their self-directed retirement funds, a strategy that most of them had never even heard of before he educated them.
- The IRS only restricts two types of investments in self-directed IRAs: life insurance and collectibles like stamps, coins, and alcohol. Otherwise, you can invest in almost anything you believe in, including real estate and private lending, as explained by Carter Lane.
Timestamps:
00:00 Funding deals with private money
05:55 Self-directed IRA benefits
08:47 Understanding retirement account fees
12:41 Introduction to Solo 401k Plans
15:42 Traditional 60/40 investment strategy
17:40 Self-directing investments challenges
20:52 Using retirement funds for investments
23:08 Connect with Carter Lane
https://www.TalkToUnified.com/Jay
24:51 Overcoming fears of self-directed investing
30:05 Maximizing contributions to a solo 401k
31:44 Saving on Taxes with Solo 401k
33:25 How To Start A Conversation With a Potential Private Lender
https://www.JayConner.com/Scripts
35:00 Sharing and subscribing encouragement
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The Truth About Self-Directed IRAs: Maximize Retirement Wealth Beyond Wall Street with Carter Lane
Jay Conner [00:00:02]:
What if the biggest risk to your retirement is not the market, but giving up control? What if everything you’ve been told about safe investing is actually costing you millions of dollars? And what if the money you need to find your first or to fund your next deal is already sitting in retirement accounts just waiting for you to unlock the funding from someone’s self-directed IRA account? Welcome to Raising Private Money. I’m Jay Conner, the private money authority, and here’s the truth. If you’re still depending on banks, traditional lenders, or Wall Street to fund your deals, you’re playing a game that you don’t control. Today I’ve got a guest who’s going to flip that script. Carter Lane is the CEO and founding partner of Unified Wealth. And for over 20 years, he’s been in the trenches. Real estate, private investing,g and building tax advantaged wealth. Strategies that put you back in the driver’s seat.
Jay Conner [00:01:06]:
After watching his own mother lose everything in the 2008 crash. Right before retirement, Carter made it his mission to make sure that that never happens to anyone else who is willing to learn from him. Since then, Carter’s has helped thousands of investors move over $100 million into self-directed retirement accounts, giving them the power to invest in what they actually understand, like real estate, private lending, and deals just like yours. So if you’ve ever wondered how to legally use retirement money to fund real estate deals, minimize taxes, and build real generational wealth without Wall Street, you’re about to step into a masterclass in just a moment. You’re going to meet my guest today, Carter Lane, right after this.
Narrator [00:02:00]:
If you’re a real estate investor and are wondering how to raise and leverage private money to make more profit on every deal, then you’re in the right place to raise private money. We’ll speak with new and seasoned investors to dissect their deals and extract the best tips and strategies to help you get the money. Because the money comes first. Now here’s your host, Jay Conner.
Jay Conner [00:02:28]:
Carter, what in the world is the biggest lie that investors have been told about retirement accounts that’s quietly keeping them broke or stuck?
Carter Lane [00:02:40]:
Well, Jay, that’s a loaded question because there are quite a few answers. But I’m going to keep it very simple. The lie that I was told, that my mother was told, is that Wall Street has your best interest in mind. And Wall Street, meaning the stock market or equities, is the only place for a person to place money to build for retirement. And that’s just, unfortunately, for most people, they just don’t know that that’s not the truth. And so WallStreett is not. And we’ll kind of get into this. I’m assuming we’ll get into this.
Carter Lane [00:03:12]:
But Wall Street is not the avenue or the financial vehicle that is allowing people to retire these days. And so what we want to share with your folks today is that there is another option, and that is a self-directed option. So hopefully that answers your question. We can kind of maybe dive into some other pathways of why that’s just not the case any longer.
Jay Conner [00:03:32]:
Yeah, well, not only is Wall Street not the only solution, when we’re comparing Wall Street to self-directed IRA companies and someone having a self-directed IRA account, from my own experience, it’s better than Wall Street. So let’s dive into self-directed IRAs. I never heard of a self-directed IRA until February of 2009. From 2003 to 2009, as a real estate investor investing in single-family houses here in eastern North Carolina, the only thing I needed to do was go to the local bank or mortgage companies and borrow money, traditionally from institutional lenders. And then after I was cut off from the banks abruptly in January of 2009, I learned about this world of private money, private lending, and self-directed IRA companies. So let’s make sure the audience understands very, very clearly what in the world is a self-directed IRA company.
Carter Lane [00:04:36]:
Sure. So let’s kind of back up a little bit and let’s talk about an IRA. So you’ve got the traditional retirement accounts, which are the IRA. And for those that maybe not know, that just stands for Individual Retirement Account. And tons of financial institutions offer those. Those are the fidelities of the world. And then you have your corporate 401ks, and those are your job’s 401k plans. What a lot of folks don’t understand is that in the 70s and early 80s, the self-directed version of these accounts came out, and companies like mine that understood the tax law and understood what the IRS says that we can do with retirement accounts, a self-directed retirement company like myself, we’re a company that builds these tools, they’re qualified retirement plans.
Carter Lane [00:05:24]:
It allows us to move an individual’s money from a current or existing retirement account, like the IRA or the 401 (k). And it allows us to move those funds into a self-directed version of that, allowing the client to have full control of their retirement funds. And so to sum it up, Jay, a self-directed retirement company like mine, builds these very unique tools and rolls clients’ money into them. So the client can invest that money into assets as we talked about before, that they believe in and know and trust, which is private money and real estate.
Jay Conner [00:05:55]:
Now I want to share with my audience that’s listening to this episode as to why this episode is so critically important. Whether you are a real estate investor looking to invest in real estate, or you’re already investing in real estate and you want funding for your deals, or you’re an individual who has retirement funds already in place. Maybe it’s a 401 (k) from a previous employer. Maybe it’s a retirement fund, you know, with a stock brokerage such as, you know, Edward D. Jones or Fidelity or Schwab or whatever. Well, as Carter just alluded to, you really are not in control. You’re not in control of. I mean, they may say, you know, they might give you a menu list of what you want to invest in, but contrast that to a self-directed IRA company, then, pretty much essentially, you can invest anything you want to.
Jay Conner [00:06:55]:
You can use your retirement funds and a self-directed IRA to go invest and invest in a single-family house. And the profit that you make on that is either tax-deferred or tax-free. If you are an individual and you’ve got retirement funds, you want to be a private lender. All this was brand new to me until 2009. The interest that the borrower, US real estate investors, pays you, that interest is either tax deferred or tax free. So the reason this is so critical, this episode is so important here with Carter, is that in my case, Carol, Joy, my wife, and I, we’ve had 47 individuals funding our deals, our real estate deals, and over half of them are using the retirement funds that they have moved over to a self-directed IRA. That’s why this is so important, Carter. Most people think that their IRA or their 401 (k) is safe, quote, unquote safe.
Jay Conner [00:07:53]:
What are they actually giving up by letting someone else control it versus them having it in their company as a self-draw to where they can control it.
Carter Lane [00:08:05]:
Yeah, so we can just talk about that, you know, and I’ll keep this on a personal level. And you kind of talked about in the intro, you know, my mother thought her retirement funds were safe. You know, she had saved almost a million dollars in the 32 years at the one job that she had. All of that money was in her 401k because she was told that that money was safe and that it was the vehicle that was going to allow her to retire. And on a Wednesday with no influence or control of her own. She lost everything. So if we take a look at kind of the arc of a retirement account or the stock market, because that’s where these, you know, traditional IRAs and 401ks are invested into. They’re invested in the market.
Carter Lane [00:08:47]:
And so we have every four to seven years. And based on whether it’s Covid-2020 to 2019, there are shifts in the market. And so the money that individuals have in these accounts of no fault of their own goes away. And so if we take a look at what is happening inside of accounts, and what a lot of folks don’t realize is that not only does it go up, it goes down, but the fees that are baked inside of these retirement accounts. And just for a sad little fact, over 63% of an individual’s money in a retirement account, an IRA, or a 401k, goes away in fees over the lifetime of that retirement account. So you have an institution,n or you have a model that says, hey, look, client, let’s give it’s a 100% of your capital. You’re going to take 100% of the risk. And over the lifespan of that investment account or that retirement account, you, the client, are only going to receive about 30% of the returns.
Carter Lane [00:09:45]:
And that’s a rigged system, in my belief, in my experience. And so are these accounts safe? No. I mean, we can take a look at what happened, and again, we’re not going to get into politics, but you know, tariff day, the market goes down 20 to 30%. Some people lost that. The unfortunate part is when those things happen, individuals, based on fear, because that is their money, they will sell at a loss. And so it’s just this cyclical cycle that puts people in a bind. And so what you and I, Jay, want to talk about today, we want to educate people that there is another option. You know, I’m not here to say retirement, you know, 401ks and IRAs are bad.
Carter Lane [00:10:20]:
What I’m here to do is educate folks that there is an option that, if you’re looking at, like Jay and I, we believe that real estate is the best investment in the world. I’ve been in real estate for over 20 years. That’s my personal belief and my personal experience. What we’re here to do is educate people that if you want to invest in something like real estate, or you want to be a private lender in Jay’s deals or in other people’s deals, you have the ax, you can control that money. That’s in Wall Street’s control; put it in your own control and invest in things that are going to make you money without having to pay fees every five seconds. And that’s just what those traditional accounts do. So are they safe? No, they’re not. That’s just kind of a long-winded quick answer, Carter.
Jay Conner [00:11:05]:
Let’s talk about it from the perspective of a real estate investor who is investing in real estate. They’re looking to borrow money, say from an individual or individuals who have a self-directed IRA account. How much money right now would you say is sitting on the sidelines right now that’s available in retirement accounts that could be funding real estate deals? And part B to that question is, why aren’t more real estate investors tapping into it?
Carter Lane [00:11:43]:
Yeah, so if we take a look at, we’re just talking about traditional retirement accounts right now. What are, what is in retirement accounts?
Jay Conner [00:11:49]:
Actually, I’m talking about self-directed IRA accounts that may have just been sitting there, and they’re looking to deploy them.
Carter Lane [00:11:59]:
Well, we can do some simple math. So if we take a look at the traditional retirement landscape here in the US is about a 7 trillion dollar price point on what folks in the US have in retirement accounts. And then we take a Look at only 3% of that is self-directed. So whatever the math is of 3% of 7 trillion. So that is the available money, the 97% that’s still in these traditional accounts. Why are people not using them? It’s a simple fact that, unfortunately, we’re just not educated. So Jay, you have The Self-Directed IRA was created in 1973, the same day that the IRA was created. The IRS put them both into law on the same day.
Carter Lane [00:12:41]:
They both were written on the same day, and they both were put out to the public on the same day. But unfortunately, you had Wall Street that took the flashlight, and they signed it up, you know, shining on these traditional retirement accounts and saying put your money into stocks or bonds or equities or mutual funds, and all the things that benefit Wall Street. You have the 401k plan, which was created in the early 80s, but the solo 401k was also created on the same day. And the Solo 401K is a self-directed version of a 401K for a business owner. So again, to answer the question, it’s just that we’re not being told that we can do these things. You know, the fidelities, the Schwab’s, the whomever, they’re not calling up their clients and saying, hey, Guys, we’ve been thinking over here at the, at our financial company, you know, instead of just giving us all your money and instead of, you know, allowing us to fee it to death, why don’t you control some of it in your own account, or better yet, control all of it and then go invest in the real estate and you make all the profits and you control all the money and you don’t pay any fees and you minimize your taxes. We’re just not being told. And so that’s why, you know, conversations that you and I are having are so important for people because I’ve been doing this for a very long time, and I’m going to keep it very current.
Carter Lane [00:13:57]:
I just got off the phone with a gal, 54 years old, tons of money in her retirement account, has six different degrees. And that conversation was the very first time that she heard that she could actually control her retirement funds for real estate. And her mind is blown, and she’s beating herself up, and like, I feel so stupid. I’m like, you have six degrees, you’re not an educator. It’s just no one’s taught you this strategy. And so that’s what we’re here to do, to educate people that there is another option for them if they choose it.
Jay Conner [00:14:27]:
Carter, I think I know why people are not educated on this, on this topic, and don’t even know about it. I believe they’re, they don’t know about it because they look to their financial advisor, AKA their stockbroker, for their financial advice. There’s zero commission, there’s zero money in it for the financial advisor, AKA stockbroker, to even tell an individual about this option as having a self-directed IRA account. And all that’s going to do is if they tell them about it and they go move part of their money to a self-directed IRA company, then the financial advisor just shot themselves in the foot.
Carter Lane [00:15:09]:
Correct?
Jay Conner [00:15:10]:
Correct.
Carter Lane [00:15:11]:
And so, to that point, so, you know, let’s take a look at real estate, right? I’m a real estate guy, you’re a real estate guy. Do, do you and I both believe that on a real estate transaction or investment, I can make more than 7% of my money?
Jay Conner [00:15:23]:
Oh my word, yes.
Carter Lane [00:15:25]:
Oh my word, yes. Correct. Do you know the average return on a 401 (k) plan is over the lifetime? So let’s just, let’s take a 20-year lifetime, and we’ll talk about a 401k in that 20 years. A 401k on average does 5.6% a year.
Carter Lane [00:15:42]:
So, if we’re taking, you know, if we’re, we’re talking to, and I have these conversations with advisors all the time. Number one, they’re uneducated on real estate, bless their hearts. That’s not what they’re taught to do. They’re taught to put their money into a bond, that’s what it is. So, for those of you that are unaware, and I’m going to simplify this, Most investment accounts, IRAs, 401ks, and they’re pumping advisors out of these schools, and they’re taught the same thing. And this is the thing, we’re going to take your money, we’re going to take the client’s money, we’re going to split it up into a 60- 40 split. 60% of that money typically goes into a bond portfolio, 40% goes into some long-term stock portfolio, and they just ride it out, and they say, ” Hey, look, if you just don’t touch your money client, we’ll probably average you about 7% a year. Okay? But what happens is when there’s turmoil and things happen, and you know, we go to war, whatever, we’re not gonna talk about politics, but something happens, and there’s a shift or a liquidation event, the advisor, all they know how to do is pull this leve,r and the lever goes risk off, and they go from equities to bonds.
Carter Lane [00:16:49]:
And then when there’s a V-shaped recovery, or there’s some, you know, growth, then they’re like, oh crap, I missed the rebound, and they pull a lever, and it goes back into equ. And so it is, that’s the strategy. And so when someone calls up their advisor and is like, hey man, like you know, I want to use some of my money for real estate, number one, the advisor is going to say, you can’t do that. What they need to finish the sentence with is you can’t do that with us. Meaning the fidelities of the world, the financial institutions of the world, the big banks, they just don’t offer a self-directed retirement account. It’s not because you can’t use your money to self-direct it. It just means that the IRS, and I’m not going to bore everybody to death with the IRS code, but basically, I’m going to sum it up. The IRS says, ” Look, IRS, IRA custodians like the Fidelties or the big financial institutions, they don’t have to offer that tool to you as an option.
Carter Lane [00:17:40]:
And in the wording on the IRS code, it just says due to hardships, meaning it’s too difficult for them to do. And really, what that means is they don’t make any money off of you by allowing you to self-direct your money. The IRS code just says these financial institutions just don’t have to tell you that it’s a thing, and they don’t have to offer it to you as a tool. And so to that point, Jay, number one, people are not being educated. And unfortunately, or fortunately, however you want to view this point, but they have to go to someone like you first, right? They have to get themselves into a position where they say, look, I believe that real estate is the vehicle that is going to get me into the destination that I, I want to be, that I’ve always wanted to go. And so they have to go to a guy like you to get educated, and then a guy like you introduces them to a guy like me. And unfortunately, that’s the model. You know, I would love to go out and educate, you know, every single person one by one.
Carter Lane [00:18:39]:
It’s just, you know, I’m connected with guys like you, and I’m connected with other high-level real estate guys. And unfortunately, they have to get educated to kind of get onto this assembly line to get moved into, sometimes talking to a guy like me. So, you know, back to that point, it’s just people aren’t educated for several reasons.
Jay Conner [00:18:57]:
And what you just said is absolutely 100% true of those 47 private lenders that we have used to fund our real estate deals. Of those 47, here’s what’s interesting, Carter. Not one of them, not one of the 47, had ever heard of self-directed IRA companies until I did what you just said. I put on my private money teacher hat, and I educated them well, I mean, even beyond that, they had never even heard of private money or private lending. And then over half of them, half of them are using their, you know, retirement funds to get high rates of return safely and securely. So, Carter, break this down simply for my audience. How does someone, how does an individual go from having a traditional IRA or a traditional 401k to actually using that money to fund deals, be a private lender, or to invest in real estate? What are the steps? How do they get it? How do they get it into a place where they can actually start doing that?
Carter Lane [00:20:08]:
Well, we would love to talk to your folks about that. So here’s how it works, right? There’s kind of a two, there’s a two part answer. One, an individual can go out and try to figure it out by themselves, right? You can call around. There are a bunch of different companies that offer a form of self-directed retirement accounts. You’ll need to find out which one that you want, which one that your funds can go into, anyway. So there are a bunch of different ways that you can kind of try to figure it out. I think the easy button, because I’m a cookies on the bottom shelf kind of guy, the easy button would be you can book a call with us, and we can do it for you. So Jay knows this,s and I’ll just kind of educate everyone.
Carter Lane [00:20:52]:
Those of you who either have retirement funds that you’re thinking about potentially using yourself for real estate and private money, or you have friends and family or other people that you’re looking at, you know, getting some investment capital from, that have retirement funds. What makes us so unique in this space is that we build self-directed retirement accounts that are attached to a bank account. So, for all intents and purposes, without boring everybody to death with how the watch is built, our retirement accounts are a checking account at a bank. So if you have funds somewhere, and it doesn’t matter where, we would roll those funds from that financial institution over into a checking account. So the money moves from stocks, into cash, into your own bank account. Because it’s a bank account, you have access to your own funds. If you want to invest in something with J, you have, you’re going to wire money, you’re going to write them a check, or you’re going to do an ACH into that particular deal. Once Jay pays you back, he wires money back into your self-directed checking account, plus your return on your money.
Carter Lane [00:21:53]:
You don’t pay a fee to do that. There are no taxes on that money because it grows ttax-free And like Jay said, there are some of these accounts that it is tax free. So I think to answer your question, Jay, the simplest thing would be to book a conversation with us, and we can educate you on what your account is and what it can go into and build you that subsequent account. And that money can roll into a checking account that you guys are able to use for whatever you want. Here’s another fun little fact, Jay. In these self-directed accounts, the IRS says that a person can not invest in two things. Which means in our accounts that we build, a person cannot buy life insurance with it, and they’re not able to invest in a collectible.
Carter Lane [00:22:33]:
Like the IRS doesn’t allow you to buy stamps, coins, or alcohol for some weird reason. But anything else, any type of investing that you believe in, that you want to invest in, that’s going to be good for your family, your legacy, building your wealth. These accounts that we create allow you to invest in any of those things. So how can someone do it? I would say book a call with us, and we can give ways for you guys to be able to do that, and we can educate you,u and we can build these tools and roll them into a checking account for you.
Jay Conner [00:23:05]:
Yeah, well, let’s go ahead and dive into that. Carter, what’s the best way for them to book a call with you and your team? Is there a phone number? Is there a website? How do they do that?
Carter Lane [00:23:16]:
Yeah, so we have a. A URL link so you can go to www.TalkToUnified.com/Jay. And again, that’s www.TalkToUnified.com/Jay. It’s going to come to a landing page. You can have some information on that landing page, but there’s also a calendar link. And I told Jay that I’m going to personally make myself available. So for the folks that are going to be scheduling these calls, we will be having, whether it’s an hour, an hour and a half, you know, if you want to do a Zoom call, a phone call, whatever you’re most comfortable with. But Jay and I come from the same camp, where we want to make sure that we educate you on what your options are and then provide a solution, if we can provide a solution for that.
Jay Conner [00:23:56]:
Thank you for making yourself personally available, Carter, because I know your time is limited and very precious. Again, that URL, the forward slash J is J A Y my first name. But let me give out that URL again to book a call directly with Carter. And that’s www.TalkToUnified.com/Jay. And of course,e that URL is in the show notes. Carter, what would you say are some of the biggest fears or misconceptions that people have about self-directed IRAs, and maybe which of these misconceptions are just flat out wrong that you’ve heard people talk about or have concerns about?
Carter Lane [00:24:51]:
There are a few. I think the misconception is, you know, people feel that, well, number one, someone wants to. I would say one of the fears is what if I don’t know what I’m doing on the self-directed side. And again, to those of you who are watching, that’s why, you know, even if I go to guys like Jay to teach me things that I don’t know. So once I have the education. Once I understand the kind of game plan or the path forward, that fear goes away because you’re having someone like Jay do it for you or teach you how to do it right. So, eliminating the fear and having a direct path to what you’re going to be investing in. But I think one of the misconceptions would be, can I get myself into trouble with a self-directed account? Now, where that comes from, maybe some of you have looked at other self-directed companies.
Carter Lane [00:25:40]:
So in my experience, where that comes from, or the fear that’s planted in an individual’s mind, who wants to self-direct and basically checkbook control their own money, which is what we do, we build self-directed accounts. With checkbook control, your money is in your own checking account. So you’re able to invest in whatever you want. You don’t have to ask permission, you don’t have to pay a fee, and there are no taxes on the growth. There are, however, other self-directed companies that are what’s called a custodian. And how a custodian works is they will say, ” Look, let’s self-direct your money. Which means the custodian will move your money from a fidelity or financial institution, and they will move it into the custodian’s control. So it moves from one fidelity or wherever into the custodian’s account.
Carter Lane [00:26:25]:
So now that the custodian controls your money. And so when you want to use that money with a custodian, you have to ask permission. Typically, it’s filling out a form, submitting the form, and the request saying, ” Hey, this is where I want my money to go. Here’s what I’m investing in, here’s why I’m doing it. And the custodian will take a look at that request, and then the custodian will send the money off for you, but they will charge you a fee for that. And then once you make the money, the money will go back into the custodian’s account, and there’s another fee. So custodians are a fee-based business. And so what they try to do, again, this is my experience, what they try to do is try to put some doubt and some fear in an individual.
Carter Lane [00:27:05]:
Lik,e hey, you don’t want to control your money, it’s super scary. Let us control it. Because they want to make money off of fees. But to the point that I made a minute ago, the IRS says very simply, you can control your own retirement funds in your own self-directed account and invest in anything that you want, except life insurance and a collectible, and be able to invest that money and not pay fees and not pay taxes. And so a misconception is that you’re going to get yourself in trouble. That’s just not the case. I’ve been doing it for over 20 years. It’s not the case.
Carter Lane [00:27:38]:
It is a very simple account to use, and you’re able to invest that money into what you want to invest that money into without paying a fee,e and without paying a tax,x and without paying a penalty. And what was the other question, Jay? Misconception 1, and then what was the other one?
Jay Conner [00:27:52]:
Oh yeah, so it was the misconceptions. And I’m glad you brought that up, Carter, because I mean that line of communication and conversation is, is out there. I mean, it’s definitely out there that you know you’re gonna get yourself in trouble if you have your own checkbook or whatever. And of course, as you clearly laid out, you know what the IRS law says and what you can do. And so the second part of the question was which ones are just flat out wrong? Well, you just identified that that’s that misconception is definitely just, you know, flat out wrong. Now let’s talk a little bit.
Carter Lane [00:28:27]:
Go ahead to that point really fast. So what would be flat out wrong is that you have a lot of individuals who will reach out to their folks’ financial institution and say,” Heyy, I want to use some of my money for real estate. And the financial advisor will say, ” You can’t do that. That’s not right. They can do it. They just have to move it into a different account. They absolutely can control and self-direct their money. It just can’t be in their account because that financial institution doesn’t offer it.
Carter Lane [00:28:56]:
So that’s another misconception or just a flat-out lie.
Jay Conner [00:29:00]:
Yes, yes. Let’s dive deep for a moment. For the advanced high-level investors out there, what’s maybe one strategy, maybe two strategies. One or two strategies that high-level investors are using with self-directed IRA accounts that maybe the average investor doesn’t have any idea about. Cool.
Carter Lane [00:29:20]:
Yeah. So let’s jump into some more advanced stuff. So those of you who are already in real estate or any business, for that matter, but we’re going to use real estate because that’s the subject that Jay and I are in right now,w or the investment strategies. So,o for a real estate investor who’s doing it as a business, meaning they have some type of business structure,e and we’re going to use an LLC as the example. So, as Carter the guy, Carter the Guy doesn’t invest in real estate. My businesses do. So those of you who have LLCs or S Corps or C Corps, but we use an LLC. If you’re doing real estate in an LLC or a business, you guys are entitled to having a business’s 401k plan, which is called a solo 401k.
Carter Lane [00:30:05]:
A solo 401 (k) is a self-directed retirement account built the same way that I just explained it, which is a trust and a checking account. Your money’s in a self-directed account. What a lot of folks don’t know, who are business owners or high-level real estate folks, is that their businesses can contribute up to $72,000 to their solo 401 (k)k account per year. So I’m going to kind of slow that down. If you’re a business owner, whether you have a holding company, let’s say it’s in Wyoming, that owns other LLCs that own property, all of those funds that those companies make can flow up. You can file a tax return after you minimize your taxes on the business side. And these are tax deductions that Jay and I we’re not going to dive into right now. But a business can have a bunch of deductions and write-offs, and we can depreciate a bunch of stuff.
Carter Lane [00:30:57]:
But when we file taxes on the business, if our business owes any taxes up to $72,000, well, instead of us just writing a check to the United States treasury for money, we’re going to take that money and we’re going to contribute it to the business’s 401 (k) plan, which is the Solo 401k. And since the Solo 401k is a self-directed retirement account, it allows us to take that money and invest it into more real estate. So does that make sense, Jay? It’s just this cyclical ecosystem that we get to build around ourselves as business owners who are doing real estate at a high level. It allows us to legally, morally, and ethically minimize our taxes on our business by taking a chunk of that money and sticking it into our businesses 401k plan and then going and buying more real estate.
Jay Conner [00:31:44]:
Who in the world would not rather pay themselves, investing themselves, then writing that same check to the IRS? So listen, if you are listening to this episode and you’re a business owner and you are paying the taxes, if you’re paying taxes and you’re a business owner to the IRS, wouldn’t you rather be paying a good portion of that to yourself in a solo 401k? If I just got your attention. If Carter just got your attention, be sure and book a call with Carter at www.TalkToUnified.com/Jay, and let me call out that URL again. That website, www.TalkToUnified.com/Jay, and my lands, start paying yourself instead of paying the IRS. Listen, what Carter just brought up right there, I’m so glad I asked the question, but Carter just brought up right there could be costing you hundreds of thousands of dollars a year, if not millions over the life of you having your business. That right there, my friend, if you’re listening to this show, was worth you getting up this morning. Carter, thank you so much for joining me here on the show. Again, to all the listeners, www.TalkToUnified.com/Jay.
Jay Conner [00:33:17]:
Carter, thank you so much.
Carter Lane [00:33:19]:
Thank you.
Jay Conner [00:33:20]:
You got it. Now listen, the name of this show is Raising Private Money. And if you’re looking to raise private money for your real estate deals or raise more private money, one of the most common questions I get is, well, Jay, how do I even start conversations with a potential private lender for my real estate deals? Well, guess what? I’ve got a gift for you. I recently wrote my Private Money Million Dollar script collection, a nd you can get my very first script for free. It’s how to start a conversation. It’s called the Curiosity Opener. You can download that gift at www.JayConner.com/Scripts. Again, that’s www.JayConner.com/Scripts.
Jay Conner [00:34:03]:
And you’ll be right on your way to talking money. Now, if this episode with Carter didn’t change how you think about money, it probably changed what’s possible for your future. Here’s the truth. Most people hear something like this and do nothing. They’ll go right back to letting someone else control their financial life. But you are not most people.
Jay Conner [00:34:30]:
So here’s what I want you to do right now. Not tonight, not tomorrow. Right now, I want you to think of just one person. Think of one person. One real estate investor, one business owner, one friend, one family member who is still playing small with their money and trusting the wrong system. Share this episode with them. Text it to them, email it to them, post it on your social media, and say,” You need to hear this. Put that in the post.
Jay Conner [00:35:00]:
Because you’re not just sharing a podcast. You might be helping someone take back control of their financial future. And listen, when you share this episode, you’re not only helping them, you’re helping us reach more people just like you who are ready to stop relying on banks and start raising private money the right way. And with this episode, pay yourself instead of the IRS, be sure to subscribe, leave a review. Let me know your biggest takeaway from today’s episode. And remember this, you don’t need more money. You need more control. I’m Jay Conner, the Private Money authority, and I’ll see you right here on the next episode of Raising Private Money.
Narrator [00:35:43]:
Are you feeling inspired by the knowledge you gained in this episode? Then head over to www.JayConner.com/MoneyGuide, that’s www.JayConner.com/MoneyGuide, and download your free guide that shares seven reasons why private money will skyrocket your real estate investing business right now. Again, that’s www.JayConner.com/MoneyGuide to get your free guide. We’ll see you next time on Raising Private Money with Jay Conner.