Today’s REI Classroom Lesson

Today in the classroom, Leo Clark elaborates on how to network with investors with self-directed IRAs in an inviting manner.

REI Classroom Summary

Find out who to talk to and what to talk about when you’re looking to raise capital with SDIRA holders.

Listen to this REI Classroom Lesson

Real Estate Investing Classroom Show Transcripts:

Mike: Welcome back to the REI Classroom where experts from across the real estate investing industry teach you quick lessons to take your business to the next level and now let’s meet today’s expert host.
Leo: Hey everyone Leo Clark here with Crest Investment Group supporting the FlipNerd glasses, got to love these. Thank you very much Mike. I appreciate these glasses. Today I want to discuss a topic that I think is extremely important to everybody that is a real estate investor in whatever aspect or whatever facet of real estate investing you’re in, that topic being the money topic.
Mike: This REI Classroom real estate lesson is sponsored by
Leo: Everybody needs to be talking about money it seems. Through the past decades we’ve been trained, educated, not to talk about money. So the one thing that you have to understand is that money is the life blood of your business. Now take these off here. Now one thing that everybody always asks and they ask me all the time no matter where I go, “Is how do you fund your projects? What is the main source of funding for what you do?” Well, from my rehabbing years into my development years I am always looking for money in many, many, many facets and my main facet is the IRA holder, self-directed IRAs, extremely viable for me.
Not only are they at the top of my list but they are very, very accessible to me at all times. One of the things that I think everyone should get very comfortable with is talking with people that have self-directed IRAs. If they don’t have a self-directed IRA that’s okay because you can then introduce them to an individual that is what they call a custodian of a self-directed IRA company.
Now I network with these people and they are not allowed to give advice on how that IRA money should be invested. So the one thing I always do that really helps me a lot is that I take that individual whether it was with a company of uDirect or Accuplan or whoever and I have them hold a wine and cheese party or some kind of gathering where they can invite their list of self-directed IRA holders.
So they’ll invite them to a location. My location, basically the house I just renovated or I just built, is where they will invite them to. So they will come at let’s say 6 p.m. for wine and cheese and this individual, the custodian, will introduce me as well as themselves and what they offer in how to educate IRA holders in investing their money.
So the biggest thing for me has always been where are they and how many of them can I meet? Well, right now in my back pocket, if you will, I’ve got about 21 of them at any given time that have money that they need to deploy because they are investing in real estate in my local market here in San Diego.
Well, one of my main IRA holders has well over a million dollars and is always looking to deploy that money. So you’ve got to get really comfortable at connecting the two. So the individual that knows the IRA holders self-directed as well as the IRA holders themselves and bringing them together in a room and then you are the presenter. You are the individual that you’re networking. You’re in a location whether it be an open house or whether it be one of your projects or even in an office building meeting room, if you will. Then you begin to introduce yourself and what you do and how you do what you do and what type of returns you can give that IRA holder. I average and I always get, “well, how much do you offer them?” I don’t give up the pie. So I always start out somewhere around 8% so that 8% is much, much better than anything that they are earning right now, so that 8% is very attractive.
Now if they’re very savvy they may be thinking, “Well, I can get more from so and so.” Well, okay, if you can offer 10 to 12 maybe even 15 to 18% and still be within your profit margins you want to be then offer it. Always be talking about money, always be comfortable talking about money. That’s one thing we were never taught as kids. We were never educated in schools of any kind is how to talk about money, and that I think is the most viable piece to everybody business out there.
For me, everyday I’m always looking for money. I’m always talking money. Tonight I’ll be going to a meeting and I’ll be talking about money and for the most of you out there that are listening to this and watching this, you’ve got to get very comfortable. You’ve got to get extremely comfortable talking about your finances and money for your business and that IRA holder will then begin to believe in you, that you can produce the returns that you are talking about.
So again, I think the IRA holder is a viable piece to all of your businesses. I hope this helps you. If there is any questions again Leo Clark with Crest Investment Group. You can find me on Facebook. I can educate you and help you more on how to get inside and network with IRA holders. So again, look forward to seeing you next time. Thanks again. See you.
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