The Simple "Borrow til you Die' Tax Strategy
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- Опубликовано: 19 окт 2024
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The quickest and easiest way to avoid payroll taxes is through buying investment properties. We call it the "borrow until you die" tax strategy. Virtually anyone with a W2, or steady taxable income, can take advantage of it and it allows you to avoid paying the IRS and build out your real estate portfolio. It personally has saved me millions and allowed me to acquire more properties. Real estate pros use this on EVERY deal, but novices are missing out simply because they don't know about it.
In today's video I take you through the 'borrow until you die' tax strategy and give you an example of how I'm doing it with my most recent project.
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A wise individual understands that building wealth involves making smart investments, strategic tax planning, and informed financial decisions. While the stock market presents opportunities for growth, successfully capitalizing on them requires both skill and expertise.
Yes, stock investments have potential, but it's important to be cautious. That's why I recommend working with a financial advisor who can guide you on the best times to enter and exit the market.
Having an investment advisor is the best way to go about the stock market right now. I used to depend on RUclips videos but it wasn't working. I’ve been in touch with an advisor for a while now, and just last year, I made over 80% capital growth minus dividends.
I'm glad I found this conversation. I just started earning six figures and need investment help. Can you share how to contact your advisor?
Her name is ' Rebecca Noblett Roberts ' Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Thank you for this Pointer. It was easy to find your handler, She seems very proficient and flexible. I booked a call session with her.
The most important thing that should be on everyone mind currently should be to invest in different sources of income that doesn't depend on the government. Especially with the current economic crisis around the word. This is still a good time to invest in various stocks, Gold, silver and digital currencies
Even with the right technique and assets some investors would still make more than others, as an investor, you should’ve known that by now, nothing beats experience and that’s final, personally I had to reach out to a market analyst for guidance which is how I was able to grow my account close to a million, withdraw my profit right before the correction and now I’m buying again
I agree. Based on personal experience working with a financial manager, I currently have ($2million) in a well-diversified portfolio that has experienced exponential growth from when i started. It's not only about having money to invest in stocks, but you also need to be knowledgeable, persistent, and have strong hands to back it up.
Your manager must be really good. How I can get in touch? My retirement portfolio's decline is a concern, and I could use some guidance.
I work with *Julianne Iwersen-Niemann* as my fiduciary advisor. Simply look up the name. You would discover the information you needed to schedule an appointment.
I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an email shortly.
I'm convinced that investing $50k-100k in the right company before it goes big is better than just saving for retirement. But since picking the right company is hard, saving might be safer-who would’ve guessed NVIDIA? I have $200k in a HYSA and want to invest. What are the best opportunities now?
I find it more productive and safe to buy growth/blue-chip stocks rather than etfs. It's advisable to work with a fiduciary advisor for well-diversified portfolios instead of relying solely on speculations.
I agree with you. As an early investor in NVDA, AVGO, ANSS, and LRCX, my financial advisor's advice was incredibly helpful. Over the past 7 years, she has helped me find stocks that did 10x multiple times. With her help, I've grown my portfolio to over a million dollars.
Well it seems like a lot of your interest is riding on your source, I could really get well accustomed to your viewpoint, get me involved.
I've experimented with a few over the past years, but I've stuck with ‘’Melissa Elise Robinson ” and her performance has been consistently impressive. She’s quite known in her field, look her up.
Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.
Don't forget the attorneys, property managers, creating & maintaining corporate entities, diligence to make sure all yearly sales tax and meeting notes are filed, banking, accounting, taking tenant phone calls, fixing problems, carrying insurance, ... Not for the lazy.
.sure let your family pay for your disaster nightmare fools acting rich is over
All that and also what do you do if it's a down market? Borrow till you die doesn't always work. There is significant risk. Also if you live in a tenant friendly state like CA or NY, you are really screwed if the tenants decide to just live there for free for a couple of years. Then you loose rent for a 1-2 years, destroyed property, legal fees. Make sure if you get into real estate renting you don't get stressed lol.
Beats working at Walmart, living paycheck-to-paycheck, with health problems, and no insurance.
@@ViceCoinif you are capable of executing this video's suggestions, then you are NOT choosing between working at Walmart and investing in real estate. It's a non-sensical comparison, and for those capable of generating extra income, choosing where you spend time makes a difference in your quality of life.
All of that ok. But deducting 100% of Air Stream? That's fishy.
This is exactly what "experts" were saying just before the GFC.
The problem is when the asset goes down and the so-called "return" disappears and the call comes from the bank.
The properties are sold and you still owe the difference and you end up on the street, literally. I watched this happen to multiple people.
Go for it. Pay this guy a fee!!!
Yup! It's just another marketing video🤑👹
exactly
'If' the asset goes down.
FYI as a Financial Planner I thought I would correct this - Capital Gains are not capped at 15-10%. There is the Net Investment Tax. The net investment income tax (NIIT) is a 3.8% tax that kicks in if you have investment income and your income exceeds $200,000 for single filers, $250,000 for those married filing jointly or $125,000 for those married filing separately.
What caught my eye was the video title ""Borrow til you Die". For some reason, I thought about what's happening with America and our national debt.
Obviously not what you had in mind
You are over thinking it.
Problem is that the US government is borrowing not so much to invest but instead to spend beyond its means. Recipe for disaster.
Hey man i thought the same thing. Screw those other guys. Lol
Haha, I thought same thing.
Nobody seems to mention that they need to pay interest on the loan which effectively negates all Tax savings and instead of paying the Tax man, you pay the same or more to the bank.
These frequent tax code changes are disrupting my long-term investment strategies. Are there ways to structure my investments to be more resilient to potential tax code modifications?
I honestly think America needs a completely restructure of their political system. It is just not working. Trump and Biden being elected out of 300 million people to run the country is evidence for that too.
This is why the US should elect more progressive politicians, who know how to manage budgets and give us (yes, our country's initials literally spell out that pronoun) much better tax credits in return for better public education and better public healthcare. but since these are nonexistent, my husband and I are being guided to finance our retirement and healthcare through a diversified investment portfolio
How can I participate in this? I sincerely aspire to establish a secure financial future and am eager to participate. Who is the driving force behind your success?
Annette Marie Holt is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.
I greatly appreciate it. I'm fortunate to have come upon your message because investing greatly fascinates me. I'll look her up and send her a message. You've truly motivated me. Thanks.
Debt is LEVERAGE, and getting caught on the wrong side of a market downturn can easily wipe you out. The quirk of leveraged traditional home mortgages is that borrowers don't get wiped out by 'margin calls' the moment they're under water.
A lot of people had this very thing happen during the 2008 housing crash using this very strategy he's pushing.
I was one of those people
This ignores three things, 1) the risk involved in real estate (yes, prices can go down just like stock prices), 2) the incredible amount of time it requires, 3) the skill that it requires. I prefer a mix of stocks, long term managed real estate, and gold. Minimize your time spent and minimize your risk.
Absolutely, those options can work as well, but the returns are typically lower. It really depends on factors like age, risk tolerance, and financial goals. I understand that long-term real estate typically grows between 5-10% per year, and stocks are in a similar range. I don’t have extensive experience with precious metals, so I can’t speak to that. However, the properties I specialize in target returns of 100-1000%. While there is time and money required upfront, the workload significantly decreases once the investment is stabilized and running.
@@KaiAndrew Thanks for the reply. What I mean is that anyone can invest in stocks and buy physical gold (always a small but important part of my portfolio), and most people could do long term RE without too much effort as long as there are good managers in the location, but what you do is profitable, risky, and not easy. If it were easy, more people would do it.
Saying that you use debt to buy businesses, while in the same breath saying buying stocks is akin to gambling and should not be considered an asset, is kind of a wild position to take. Buying purchasing shares of a company is tantamount to buying a business in a lot of respects. To be clear, ALL investments are gambles to a certain extent. But look at it this way, though there is a chance that someone using your methods could certainly yield high returns if everything is executed flawlessly and you throw a pinch of luck in there, but it's unwise to say that by doing so you're taking less risk than investing in a PG, JNJ, MSFT, or some other flawlessly ran company. I'd argue that they're better at running a business than majority of your audience, and have been doing so for far longer.
“For whatever reasons, markets now exhibit far more casino-like behavior than they did when I was young” - Warren Buffett, annual letter
You must have forgotten 2000, 2008 and 2020. With your confidence in these ‘flawless’ companies you should be pulling out some personal loans and buying more stocks.
Without understanding how to read financial statements, quarterly or annual reports, I’m sorry, you’re straight gambling. Comparing that to me (and others) learning and becoming a real estate builder, developer, investor and business operator over the course of two decades are not the same thing.
If you’re investing in individual stocks and you’re not actually studying the companies and diversifying outside of stocks, you’ve been lucky for a relatively short amount of time - Godspeed.
I am impressed with your update with these strategies, I am looking for tax efficient way to rebalance my $800k portfolio without triggering capital gain tax. what asset location strategies should i use?
The best strategy depends on your financial situation, account types, tax bracket, and investment goals. Consult a financial advisor or tax professional to tailor these strategies for maximum tax efficiency.
My advisor helped me rebalance my $2m portfolio without triggering capital gains taxes by using tax-advantaged accounts and reallocating dividends and new contributions. They also recommended tax-loss harvesting and strategies to stay within my tax bracket. Q2 taxable divs this year was $17,388 thanks to her guidance. I maintained my desired asset allocation while minimising taxes.
@@PauleAraiza My advisor helped me rebalance my $2m portfolio without triggering capital gains taxes by using tax-advantaged accounts and reallocating dividends and new contributions. They also recommended tax-loss harvesting and strategies to stay within my tax bracket. Q2 taxable divs this year was $17,388 thanks to her guidance. I maintained my desired asset allocation while minimizing taxes.
@SlowrideHome91 Real estate prices exploded, interest rates exploded, but my wage the same, i'm screwed !! who is the advisor guiding you please? I could really use some help right now
@@Dollrnri I'm cautious about giving specific recommendations since this is an online forum and everyone situation is unique, but I've worked with *Jennifer Leigh Hickman* for years and highly recommend her. Look her up to see if she meets your criteria
This is something I have been fighting. I hate how when we invest in things we don't get much out of it very quickly. Thankfully there is a new way to do it for those that know how!
I’m in Ohio and the housing market here over the last 7-8 years is unlike anything I’ve ever seen. Homes that were bought for $130K in 2015 are now being sold for $590k. I’m talking about tiny, disgusting, poorly built 950 square foot shit boxes in quiet mediocre neighbourhoods. Then you’ve got Better, average sized homes in nicer neighbourhoods that were $300K+ 10 years ago selling for $750k+ now. Wild times.
Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes.If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.
Personally, I can connect to that. When I began working with a fiduciary financial counsellor, my advantages were certain. I got into the market early 2019 and the constant downtrends and losses discouraged me so I sold off, got back in Dec 2021 this time with guidance, Long story short, its been 2years now and I’ve gained over a million dollars following guidance from my investment adviser.
This is huge! think you can point me towards the direction of your advisor? been looking at advisory management myself.. seeking ways to invest and make more money with the uncertainty in the economy.
‘’Aileen Gertrude Tippy’’ is her name. She is regarded as a genius in her area and works for Empower Financial Services. She’s quite known in her field, look-her up.
Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.
I recently subbed to your channel and I hardly comment on YT, but these recent videos you posted are straight bangers with awesome value, clean edits w/ supplemental graphics, and actually provide use cases/numbers/tax codes for others to dig more into. Keep it up! I’m looking forward to catching up on your previous content & for the next video!
Thank you, sir. That means a lot. :)
Except if you listen to him, you’ll be bankrupt and have bad credit.
@@pauls064 everyone should do their own due diligence and consult with certified tax advisors before making huge financial decisions. But i generally think folks being more transparent about their finances, strategies and use cases is a net good. Do not take direct advice from the internet.
This guy makes used car salesmen look respectable.
Bingo!
In what way? Sharing a legit tax strategy used by millions or was it me plugging a legit accounting service on my channel...😘
@@KaiAndrew This strategy is new to people. The majority only get tax money from the government by overpaying their estimated tax on their paycheck.
😆
I agree. Trouble is my brother in law has lots in saving but can't see to invest.
Because so many people overpaid for homes even while loan rates were low, I believe there will be a housing catastrophe because these people are in debt. If housing costs continue to drop and, for whatever reason, they can no longer afford the property and it goes into foreclosure, they have no equity since, even if they try to sell, they will not make any money. I believe that many individuals will experience this, especially given the impending mass layoffs and rapidly rising living expenses.
I advise you to invest in stocks to balance out your real estate, Even the worst recessions offer wonderful buying opportunities in the markets if you're cautious. Volatility can also result in excellent short-term buy and sell opportunities. This is not financial advice, but buy now because cash is definitely not king right now!
You're correct! With the help of an investment coach, I was able to diversify my 450K portfolio across markets and produce slightly more than $830K in net profit from high dividend yield equities, ETFs, and bonds.
Would you mind providing details on the advisor who helped you? saving for a pension through a corporate program since the age of 18. I hit greater tax along the road, so I increased my company pension with a SIPP (tax benefits). I'm now 50 and would love to expand my finances more aggressively; there are a few automobiles I still want to drive and a few mega-vacations that I still want to take.
Well, there are a few out there who know what they are doing. I tried a few in the past years, but I’ve been with Jessica Lee Horst for the last five years or so, and her returns have been pretty much amazing.
I located her, sent her an email, and scheduled a call; hopefully, she will reply because I want to start the new year off financially strong.
We have a similar boon with property purchases in Australia.
This all demonstrates how money is just a game. Play within the rules, and filter all the money out of the masses.
This truely is a rich get richer n vice versa scenario
I borowed with a consumer credit @ fixed 2,8% here in EU and invested it in businesses (stocks) that compound. I didn't use some bank margin trading or whatever. A simple consumer credit, where th bank pays you effectively during periods of high Inflation. Properties are scam
We pay 20% interest on debt. Then you pay it off with income that's taxed at up to 45%.
I am novice here. Are you talking about income tax returns?
I would say you pay a corporate tax (less then 45) on your income as a sole proprietor. But ya I get your point. There has to be a healthy profit margin there to battle all these obstacles. 300 percent return investments too, where do you find these? lol made it sound so simple.
With a good investment plan that ensures steady income without any doubts I am prepared for a well organized retirement. I started investing in stocks 3 years ago and so far, I am making a good yield on my dividend.
Not everyone is as lucky as you are you know. How are you doing it?
Herman Jonas, a licensed FA has undoubtedly helped me make so much progress. He has guided me to identify key stocks, pinpointed strategic entry points, and provided risk assessments, ensuring that my decisions align with market dynamics for optimal returns.
To me, investing is not worth it and I know that's the same mindset holding me back from taking a step forward in my finances. It’s all gambling.
I’ll be clocking 47 soon and I want to put my finances in order and make better investment decisions. How can I get through to him?
Hermanw jonas that’s his gmail okay
I am impressed with your update with these strategies, I am looking for tax efficient way to rebalance my $800k portfolio without triggering capital gain tax. what asset location strategies should i use?
The best strategy depends on your financial situation, account types, tax bracket, and investment goals. Consult a financial advisor or tax professional to tailor these strategies for maximum tax efficiency.
My advisor helped me rebalance my huge portfolio without triggering capital gains taxes by using tax-advantaged accounts and reallocating dividends and new contributions. They also recommended tax-loss harvesting and strategies to stay within my tax bracket. Q2 taxable divs this year was $17,388 thanks to her guidance. I maintained my desired asset allocation while minimising taxes.
Real estate prices exploded, interest rates exploded, but my wage the same, i'm screwed !! who is the advisor guiding you please? I could really use some help right now
“Sophia Maurine Lanting” is the coach that guides me, She has years of financial market experience, you can use something else but for me her strategy works hence my result. She provides entry and exit point for the securities I focus on.
I just looked up this person out of curiosity, and surprisingly she seems really proficient. I thought this was just some overrated BS, I appreciate this.
If an investor of leveraged short term rental property does not have enough money in case tenants trash the rental. Then the investor might not have enough cash flow to repair walls, doors, repaint, replace plumbing fixtures after a big party.
The down time during repairs, can put the investor in a serious cash flow bind.
To avoid foreclosure, the investor might sell damaged short term rental property for less than original purchase price.
I don’t know….
Would the investor still owe the difference? Or can he declare bankruptcy?
Again I don’t know.
Anyone who is successful as a property investor is highly skilled and blessed with good luck.
To avoid these possible problems, an investor should have considerable cash or liquid savings to smooth out possible future snags.
Cash flow can be tricky
Good luck
Wow this is such valuable information. I had always wondered why the Brrr method is such a benefit and utilized so much. Now I understand Robert K. This makes sense. Love it. I never understood why debt is good. Thank you so much for this video.
you just perfectly explained how low interest rate and quantitative easing sends inflation and wealth inequality sky high
No, that’s not correct. Low interest rates and quantitative easing are designed to stimulate the economy and encourage spending and investment; they don’t cause inflation. Printing $7 trillion and distributing it freely is what drives inflation.
I don't understand how you were able to deduct the entire price of the airstream. I love this idea, just hoping for clarity. Thanks!
Someone needs to remind this guy short term rental opportunity is long gone
Quit hating
Not gone but not as easy as people think either. Worth doing but lots of work to make it a unique enough property to be a good performer
@@CarlosJimenez-jh5xzhe’s not hating, he’s right, and many of Kai’s videos are just to sell his course and have very misleading info
These frequent tax code changes are disrupting my long-term investment strategies. Are there ways to structure my investments to be more resilient to potential tax code modifications?
I honestly think America needs a completely restructure of their political system. It is just not working. Trump and Biden being elected out of 300 million people to run the country is evidence for that too.
This is why the US should elect more progressive politicians, who know how to manage budgets and give us (yes, pur country's initials literally spell out that pronoun) much better tax credits in return for better public education and better public healthcare. but since these are nonexistent, my husband and I are being guided to finance our retirement and healthcare through a diversified investment portfolioportfolio
I'm intrigued by this. I've searched for financial advisers online but it's kind of hard to get in touch with one. Okay if I ask you for a recommendation?
Vivian Jean Wilhelm a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.
In my experience, borrowing money against your home is the best strategy. You can use it and having tax write off as well. 🙂
We are at a point when most of these taxes, tariffs, and fees aren't required to fund the government. With the advent of digital currency, having a 3~5% tax from each transaction will more than fund the US government. It would effectively tax the use of USD including offshore. This would eliminate the need for nearly all other federal taxes.
'Investing in the stock market is risky and stocks shouldn't be considered assets'
When your currency is not pegged to anything of value - yes it should
Take a look at the risk adjusted yoy returns for the last 20-30 years for just the S&P. The game has changed; especially since 2008. Your Government has a license to print money, that means all assets inflate
I think it's time to make it more appealing for potential buyers. Real estate can be quite the rollercoaster! the stress and uncertainty are getting to me. I think I'll cut rents to attract potential buyers and exit the market, but i'm at crossroads if to allocate the entire $680k liquidity value to my stock portfolio?
'Overall, buyers hold a lot of the cards right now, and sellers are having to give out more concessions to close a deal." All the best, buying on sale is actually one of the best ways to invest in stocks, and advisors are ideally suited for such task
Great video, but who really wants to pour so much time and effort into something as two-dimensional as money? There are easier and more effective ways to earn without the headaches and endless commitment. Many people suffer from greed, always chasing more when, in reality, you don’t need much to live comfortably. The world is what you make of it-everyone lives in their own reality and creates their own suffering. That’s why greed is one of the seven deadly sins. Warren Buffett one of the most successful investors does not mind paying taxes because making money is so easy for him. Good for thought. Give to Cesar what is Caesar’s.
That's so brilliant. Can you share what the 3x asset is? 33% simple annual return is outperforming market. What are those assets?
Real estate is EXTREMELY illiquid compared to stocks and easily more speculative in many cases.
In Singapore you cannot borrow till you die. There is a limit to how much you can borrow across all agencies. Govt will ensure no one run into huge debts
Bros just giving out gems for free... I had to pay for some of this info
Walked into a room of rich folk sharing tips on how to avoid paying taxes... Oops... Ill just back up slowly.
I am not sure about other contries. But in Australia you dont pay capital gains tax on your Priciple place of residence/ the house you live in.
A number of years ago a neighbour would buy a place that needed some work. Nothing to great. Tidy it up, continue living there a time. Sell and make a good profit. No tax. Next place, rinse and repeat. The cash to be made is huge. Property prices where I now live are upwards of 500,000. Friends bought a place, very run down. The wifes father is a builder. The husbands father is very good with his hands. The 4 parents would come on a Saturday, 6 of them head down into reno work. Over several months they made a very nice house. Sold 3 years latter 200 K profit. Bought another place and had 100 K over. It is being put into 2nd place. I am guessing next time they will have almost enough to own a new house, all in 6 years and 8 years after marriage.
I guess you are in fact borrowing to buy the assets, but the clear differentiator here is the cost segregation. You almost breeze over the interest expense which is the benefit of borrowing. At some point as rates creep up it gets at least challenging, at most damning.
Sorta. I just locked in a 30 year fixed at 6.9%. My cash is in the bank is giving me 5.1%. Interest is tax deductible so it's almost a net zero to borrow (if you have the cash). Regardless of the cash situation, if you're actually investing I hope you're looking at investments that provide you a higher return than 6-7%, otherwise you're doing something wrong.
5.1 for now it will eventually get lower again though.
@@KaiAndrew
That was the cost of a hard money loan, just a couple years ago
Flip side is RE market values and rent tanks and down you go.
Do everyone a favor and plot those markets values over the last 70 years.
Yeah, the bubble popped in 2008, but the government stepped in, bailed everybody out, and said, "Don't worry, guys, we'll just stick it on the debt." At that point, the US wasn't $35 trillion in debt. The next time the bubble pops, there's a good chance you won't be able to stick it on the debt. There's a good chance the government will try to kick the can down the road one more time and the can won't budge. Do yourself a favour and plot a graph of median price houses versus median household income. If you want to get into the real estate business right now, go ahead, but you'll be picking pennies in front of a steamroller.
Rent never goes down. Ever
@@american5564 yes it does. And you could end up with no one choosing to rent from you .
@@firebirdlover4460 😂🤣👍🏻
Stock investing if done right and for the long term is not speculative and has proven to deliver superior investment returns. On average approximately 10% per year versus 5% on real estate. Plus there is often significant property taxes, maintenance and insurance costs to real estate, positive cash flows are not easy and certainly not guaranteed. There are also the tenant risks of defaults and lawsuits. The advantage to real estate is leverage, however this comes with its own risks especially when it comes time to refinance. Not to mention the work and constant headaches that come with the responsibility of owning real estate.
You’re 100% right! 10% is the S&P, basically. My goal is to have 40% of a Multifamily building’s down payment in stocks. Then take out half for the down payment, and leave the other half invested. I would then put the money I made from the real estate back in stocks. After 7 years, I should have my initial stock portfolio back and have the real estate. It would take even less time to get back to my initial stock Investment because I’m using the real estate money to grow it. Then I would cash out refinance as the property value went up. I would take that money out, and invest it too. Keep doing that over and over.
Agreed. So many niggling little details as a landlord. If you bet big you do get bigger returns (like this guy) but the downsides are also huge. And like you said, one bad renter can make your 200k remodel look like loose change.
Very clever!
Love that house!
Great strategy
Off topic, but have you stayed in that earth sheltered home? I’m curious to know if it is as energy efficient as people claim.
Doing this during a rising real estate cycle could work, but we are currently moving into a real estate crash in many markets, TX, FL etc. and you could get caught in a squeeze and lose your investment and have to eat the interest expense. There are no sure things in life, especially when our currency is losing purchasing power at over 30% per year, like right now.
It works across cycles if you play the long game. The key is having a long-term plan: as long as the property is a true asset (not a liability) and you can manage the loan servicing, you’ll ride through corrections. Think about the 2008 crash-if you bought at the peak in 2007 and held the property until today, would leveraging money then have been worth it? Absolutely.
You forgot to mention tha real-estate properties needs a lot of maintenance work.
If your roof is leaking then you can spend one year of incomes to fix it. In the meanwhile the bank knock at your door for the mortgage...
That’s like saying, ‘Don’t start a business because you’ll have to manage customers and handle payroll…
The second thing people have to learn right after how to get rich, is how to stay rich. Dodging taxes (legally that is) is the biggest part of it.
What if you buy a long term rental property and you personally mow the lawn or you work on landscaping, wouldn’t you then qualify as putting in 100+ hours?
Real estate is YOLOing on margin for most people. I have no problem with YOLOing.
Why did you choose to show the highest possible w-2 tax rate (37%) but the lowest possible capital gains tax rate (15%) on your graphic when comparing the two types of taxes?
To help illustrate the difference between the two....
I may have to watch this again
Dollars are a liability, debt is an asset. We live in a debt based economy.
get educated before opening your mouth
Debt is only an Asset for the Lender.
Dropping bombs like always! Looking forward to working with you and the team next year!
Does this work for student loans?
When someone asks you "How did the 08 housing crash happen? How did people get so under water?", send them this video.
Nah. Your understanding of history is not accurate. The 2007-2008 financial crisis was primarily caused by ‘sub-prime’ mortgages, where predatory, commission-based lending targeted unqualified buyers. Many of these buyers had little to no income or poor credit, but they were still approved for loans, often with 0% down payments and interest-only adjustable-rate mortgages (ARMs).
What I demonstrated in the video is a strategy that savvy investors and entrepreneurs have used for generations, including during and after 2008. The key difference is that we are qualified, understand how to underwrite assets properly, and have cash reserves and excellent credit.
Misunderstanding the causes the biggest financial crash in the last 100 years is precisely why such mistakes risk being repeated.
Saying stocks are as close to gambling as possible is crazy
Naked short selling? Remember when Greenspan said “I don’t find it concerning that there is more action on speculation upon a stock than there is revenue”?
@@notsure1135 speculation is gambling, long term investing in stocks is one of the safest things you could invest in especially because you can diversify
Not really. It’s all gambling to a degree
Look at stocks history. The elderly lost that gamble in 2008. That's why some can't afford to retire. It 100% a gamble. Nobody saw the recession was coming along with other historical rise and falls in stock market
Yes, it is a gambling if you day trade stocks.
I’m watch this 10 more times
Why? this is just stupid advice and stupid marketing scam.
@@jonathansaucedo1924 I guessing u have a better strategy? If so I honestly want to hear it
@@youngandsuccessful22 Yes, I do have a better strategy. Work, live bellow your means, don't borrow money, buy stock, buy crypto, buy land, keep doing this every day, every month, every year until your body can no longer work. You'll have a good retirement.
So if I buy these overinflated rental properties do you pinky swear promise this tax benefit will make up for my lost equity?
i like this channel, but not sure what banks people are using , but not many banks are making loans right now
A lot of great tips here that are easily missed. Basically this is real estate 2.0.
So how does this work with Kamala's unrealized gains tax plan?
Lowering your taxable income WILL affect what you personally are qualified to borrow in round two. This goes unmentioned in the video and depending how effective you are, may come as a massive shock when you look to finance future property regardless of your credit score.
Nah, not true. Lenders and banks are sorta smart - they understand when there's someone who owns multiple businesses, has several properties and a lot of cash, there's probably a good reason why he/she has a lower taxable income. That's why they'll add back in depreciation (it's a paper loss, not real) and they'll look at your business books. Never caused me issues before except when I only had a single W2 income and only 'hard' deductions.
@@KaiAndrew can happen and has. And could happen to others who get their otherwise “high” w-2 tax bracket whittled down to single digits for the first time.
Kinda like finding out some of your investment property repairs and upgrades will end up on 25+ year depreciation schedule. It’s still the right move, just surprises the hell out of you the first time…
Not if one uses DSCR financing . . .
Someone tell this guy that buying real estate is MORE risky than your average S&P500 stock.
When you take a 20% down mortgage on a home, you’re leveraging 5-to-1. That means if your home depreciated, you can be underwater and OWE the bank a lot. That doesn’t happen with stocks.
@@rick03168 he’s just selling a dream to grow an audience on here. Typical RUclips grifter.
he doesn't care. These people don't do the bullshit they preach, that's why they spend all this time making videos and peddling for sponsorships
Well, I've joined several other real-estate communities and "gurus", I can tell you Kai is legit. I joined his community/training when it first opened and he is actually accessible and transparent about what he offers. Nothing is easy or cheap or risk free but his niche is where the STR industry is headed.
@@rdelrinc you don’t need a youtube mentor to do real estate deals dude. Just do some reading online and do it. Ideally have a trusted family friend you can shadow or bounce ideas off of to start.
Real estate isn’t as glamorous as these RUclipsrs make it out to be. It’s a lot of grinding for average gains. The above average gains come from taking big risks, and that can blow up in your face since risk goes both ways.
There are no free lunches in finance. I work as a quant on Wall Street and know this first hand. Anyone who sells you some systematic approach to making big money is scamming you.
Houses no longer depreciate
There are too many people buying houses cash now😂
For the Newbie if you are actually trading in the crypto space and you don't have a sound mentor. Then you are certainly going to get liquidated in 90% of your trades. Yeah that's sad truth. I remember when i just got into crypto back in 2019 but later in 2020 i ended up selling it because i have lost alot trading all by myself without a guide. Got back into crypto early in 2023 with $10k and I'm up with $132k in a short period of time
I'm new to cryptocurrency and i don't understand how it really works. How can someone know the right approach to investing and making good profit from cryptocurrency investments?
As a beginner what do i need to do? How can i invest, on which platform? If you know any please share.🙏
As a beginner investor, it's essential for you to have a mentor to keep you accountable. Myself I'm guided by Annabelle Hartfield. A widely known crypto consultant
it's great to see others who also benefits from the service of Annabelle Hartfield.
I'm surprised that this name is being mentioned here, i stumbled upon one of her clients testimonies on CNBC news last week...
Explain the difference between paying taxes and paying interest.
Especially when it is amortized with most of the payment going to interest at the first half of the loan period.
This works great as long as your assets continue to increase and rates remain low. Good luck
I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Veronica Hoy.
Wow. I'm a bit perplexed seeing her been mentioned here also Didn’t know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.
She is my family's personal Broker and also a personal Broker to many families in the United states, she is a licensed broker and a FINRA AGENT in the United States.
You trade with Veronica Hoy too? Wow that woman has been a blessing to me and my family.
I'm new at this, please how can I reach her?
I was skeptical at first till I decided to try. Its huge returns is awesome. I can't say much
Robert kiwasaki does the same thing . He did a interview and spoke of this . Rich dont pay taxes through debt .
Great video, thanks for sharing!
This only works as long as bonus depreciation remains a thing which is done after 2026 after reducing to 20% and then 0 in 2027, correct?
It’ll still work, you just won’t be able to deduct as much in the first year, you have to spread it out over its deductions time frame which ranges from 5-39 years depending on what it is as far as I know.
"Ordinary" income is NOT taxable, you create the obligation by filing, so do not file.
He’s like the Inverse Dave Ramsey
Question: how is this strategy affecting your debt to equity ratio? Your purchasing power on another property?
Not much. The properties (and business) generate income so essentially cancels out the debt or adds to my income. If you buy properties that just sit there, that another story.
@@KaiAndrew I guess you buy them 20% down, with a lender that accepts rent appraisal.
and where do you get your positively geared investment property? Due to interest rates and the property prices, all I am seeing is negatively geared.
? Borrow until you die. I'm 70 and was always told to stay out of borrowing and pay cash for what you want. I just took SS. And debt free and always paid cash, "cash is king". Plus stay in poverty level and pay no taxes.
does this strategy also apply to making money from rental properties under your personal name
How do you don't pay taxes over the money that you use to pay the money borrowing?
Because you are taking 'paper losses' through bonus depreciation.
Good video. What do you think about Bitcoin? I heard it's better than property.
Great content, as always! A bit off-topic, but I wanted to ask: I have a SafePal wallet with USDT, and I have the seed phrase. (behave today finger ski upon boy assault summer exhaust beauty stereo over). How can I transfer them to Binance?
Impressive
Kudos to your editor! How the video was put together sure is a work of art.😍
The interest counts as a tax. After three years that's 18-20% of the asset. You're taking a big risk in today's economic environment where customers are reluctant to pay a premium for anything like a luxury property.
this is why DC need to change the tax code to a 10% across the board, no ifs, ands or buts!!! No loop holds, no excusses!!! But still have that Roth stay away from taxes.
Better idea: 2% federal property tax on all assets, regardless of who holds them.
@@raymondflavin8708problem with that is people that don’t own property will vote for things against the property owner. Need a flat tax no concessions ever. Everyone has skin in the game.
Maybe a system like could work, but you have to look at it from the IRS' eyes. Certain 'seasons' of the economy require different incentives. There are times when they need more innovation - so they create tax incentives for businesses to invest into R&D. There's a time when we need more infrastructure - so they create incentives around that industry. Right now, it's focused on microchips and housing. Gotta understand both the micro and macro, not just what "feels" fair.
@@KaiAndrew I disagree with this whole heartedly. Its been well established that if tax something, you get less of it. That is why its a well known tool for reducing things like ciggarettes, fossil fuels, and ammunition.
If you tax reported incomes, you get less reported incomes, and less taxable revenue. Keyword: Reported.
Flat taxes/low taxes have shown time and time again (Hungary flat, singapor low) to sky rocket gdp to the point where tax revenues follow right behind.
I encourage you to watch Art Laffer, he goes in detail how this principle is put into practice.
He doesn’t understand that you probably helped 100 people pay their mortgage with the Airstream purchase ! Yeah your welcome . And all at H/D, drivers . I bet your fireplace guy didn’t work for free.. it’s very nice. If you and I don’t do what we do the economy stops ! We are the gasoline for the economy. Grumpy shorts needs to read The creature of Jekel island and learn about what money is and how it is created . We take huge chances and should be rewarded . I’m older than you and have been in real estate for 35 years . I like keeping an extremely low LTV but Ive been through 1991 , 2000, 2008 recession and can’t afford to lose everything now. . Curious what you think about investing out of the US , let’s say Cabo San Lucas ? Looks interesting with all the building going on …. And a Recession looming. Good luck with your business .
This is the video book version of Robert Kiyosaki’s book.
The poor persons version of this is to do this with student loans and credit card debt with some crypto laundering and fleeing the country sprinkled on top.
It’s all a rich persons form of slavery. Money only has value because a government says it does. Stop chasing meaningless value. Start living life. That’s when you find purpose and joy. Meaningless paper loves purpose and joy and will always seek it out to either build it up or destroy it. 😈
Based on how I interpreted this, is reduce your Taxable income now and continue doing that through Depreciation, ect... then pay all the difference later by your loved ones after death? If so how are you taxed after death and are there ways to roll your portfolio into a trust or someother tax savings loop hole?
I wonder if there is a Canadian version of this!?
Sort terms rentals are driving rents to unaffordable highs contributing to the housing crisis we’re experiencing.
And what money do you use to make all the payments on the loans??
Do you have to pay your monthly payments and interest rates on a loan? If not i am sold
Of course. Then don’t do it-haha. But the next time you drive down the street and see all the buildings, homes, hotels, and rentals, ask yourself: are all these investors and owners really going broke?
Lots of financial advices today but at least this one considered dying
How to finance the growing interest & tax on the interest (if it’s a related entity).
Thanks to you Kai. Following your recommendation, I started researching into Abby Joseph Cohen Services. Thankfully it was a little over a year ago now, I started an lnvestment with Abby's Services and that allowed me to be on much MUCH more stable ground in the face of global financial upheaval.
So thank you, your channel, and your employees. For what it's worth, it made a difference for me and my little family.
Same here, I got to know about Abby Joseph Cohen Services from Kai in 2021. Since then I've paid off 160,000 USD of debt. Now I'm working on building an emergency fund. I didn't even have a savings account three years ago.
I know this FA, Abby Joseph Cohen Services but only by her reputation of being a former employee at Goldman Sachs; even though she's now involved in managing portfolios and providing investmnt guidance to clients. I have been trying to get in contact since I wached her interview on WSJ last month
@@EalDieguez
Well her name is 'ABBY JOSEPH COHEN SERVICES'. Just research the name. You'd find necessary details to work with a correspondence to set up an appointment.
Abby Joseph Cohen Services has really set the standard for others to follow, we love her here in Canada 🇨🇦 as she has been really helpful and changed lots of life's
The very first time we tried, we invested $7000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
You forgot to mention that for capital gains, only long term is taxed at 15-20 percent.
Short term is taxed the same as your tax bracket.
Not true. If you make real money there's also the 3.8% Obama net investment income tax....
Yes, thank you for that detail. For example: Flippers usually will be taxed as ordinary income because they made their cap gains in less than 12 months. Thanks for the comment!
Wild strategy
thanks to all your teaching
It's my pleasure
The real move is to start your own banking system, and borrow from that to buy assets.
So I don't understand this tax strategy that these ultra rich people are doing. I get that they're borrowing on their investments instead of spending their investments and saving tax money. But don't you eventually have to take money out of your investments and pay back the loan? Then you have to pay taxes. I don't get how this helps.
I am definitely NOT ultra rich. These are just savvy middle to upper-middle class things. The ultra rich can do things I only dream about. I buy assets. For example, a home or a building. In the simplest terms that structure generates me income. I use that income to service the loan. The structure increases in value over time, income increases as well. I bought that asset with money I did not have to pay taxes on. Hopefully that clears it up a bit.
@@KaiAndrew But if you have income from rental property then it’s taxable. Isn’t it?