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An Accidental Excavation

How was your week?

For a family in Norway, it was one to remember when they stumbled, almost literally, on something extraordinary while searching for lost jewelry in their back garden.

Using a metal detector, they accidentally became archaeologists, finding Viking-era relics which experts reckon date between the years 780 and 850.

Stay curious. You never know what you might find…

Jeremiah “Chief Excavating Officer” Desmarais

In Today’s Issue 👇

• 💰 The IRS-approved, tax-free retirement-fund option

• 📈 What to do about lopsided index funds

• 👍️ How to Hire Low-Cost, High-Value Virtual Assistants

And all of the week’s biggest headlines to make you the smartest advisor in the room.

 💸Invest Using Your Retirement Fund

Mark and Karla, a couple from Benton Harbor, Michigan, recently sold their belongings and bought the nearby Kampgrounds of America franchise.

They needed $1.6M.

They found some change in the couch cushions and used a bank loan to come up with a chunk of the payment.

But they also tapped into their 401k’s and leveraged the money they’d earmarked for retirement to invest in the business.

And if you have any clients who are looking to buy or start a business, they may be able to do the same…using a method that takes static retirement money and puts it to work in a tax-advantaged way.

Enter the ROBS plan…

Here’s how it works:

• Funds from the client’s existing retirement account are rolled into a new one, with which they’re eligible to invest in a business.

• They can use their new retirement account to buy shares in a business they start, or to buy an existing company (including franchises, like the aforementioned Kampgrounds of America).

And the best part?

It’s tax- and interest-free.

Here’s how to help your clients pull it off:

• Set up their new venture as a C corporation. C corps are the only ones that can raise funds by selling stock. They’ll be buying stock, so the biz needs to be a C corp.

• Establish a qualifying retirement account. The new C corp must have a plan where your clients can invest your existing retirement funds. Eligible plans include 401(k), 403(b), Keogh Plan, and more.

• Roll over funds from the previous retirement account to the new one.

• Instruct your client to buy stock in their new company.

• Use the money received by the C corp to cover biz expenses.

Easy!

Here’s an email template you can use to introduce the idea to your client:

Hi [client],

I wanted to give you an idea to chew on this week.

There is a little-known, tax- and interest-free, IRS-approved way to invest your retirement cash into a business.

In short, you can use your retirement savings to start your own company or buy an existing one.

This of course isn’t risk-free, but it’s an alternative — perhaps a wiser alternative — to high-interest bank loans or private funding, if you’re looking to flex your entrepreneurial muscles in the next couple of years.

I’d love to walk you through it over the phone, if you’re interested.

Are you free one afternoon this week?

Best,

[Name]

Headline Roundup

🏠 Affecting Your Clients

• Budget analysts, lawyers among jobs most exposed to AI [BNS]

• Price growth should show fight against inflation is back on track [BNS]

• Paying off our mortgage early sparked debate. But it was right for us [WP]

📈 Markets & Economy

• U.S. home prices increased in July [WSJ]

• Fed’s Barkin says labor market key to assessing demand, prices [BBG]

• Nvidia targeted in French antitrust raid [WSJ]

💼 Industry Roundup

• Only richest 20% of Americans still have pandemic savings [FP]

• U.S. small-cap stocks wilt in the heat of higher interest rates [FT]

• Rising drug prices dramatically outpace inflation, squeezing retirees [FP]

Sponsored

🗣How to Hire Low-Cost, High-Value Virtual Assistants Who Explode Productivity and Free Up Your Time

When my good friend Garrett Gunderson joined us on the Power Hour last week, he said something that really resonated with me…

By delegating ROLES and not just TASKS, you can free yourself up to live the kind of lifestyle that you never want to retire from.

🤯🤯🤯

You see, the key to building a successful and scalable business that doesn’t make you feel tied down is to remove all of the low leverage and low enjoyment tasks.

As advisors, we don’t always do this because we:

❌ Don’t know WHO to outsource roles to

❌ Don’t know HOW to outsource roles

❌ Feel like we don’t have the MONEY to do it

❌ Are scared of the TIME it will take to train someone

Can I get an amen?

Well, I’m here to tell you that we’re living in 2023 and you don’t need to bring on a W-2 employee or spend months vetting people to make a hire.

The answer? Virtual assistants.

I’ve hired hundreds of virtual assistants over the past decade-plus and it’s changed the way I approach business.

But most advisors who try it get it wrong…because they don’t understand how to do it.

I want to make that easy for you.

So I’m creating a playbook that reveals How to Hire Low-Cost, High-Value Virtual Assistants Who Explode Productivity and Free Up Your Time.

This includes:

● Which tasks to outsource

● Where to find virtual assistants

● Templates you can use to find the best VAs

● How to develop SOPs so that you don’t have to hand-hold

● The best tools and & platforms for effortlessly managing VAs

In order to receive this print playbook in your mailbox in October, you must be a subscriber of The Virtual Advisor.

If you’re new, I’ll give you this first issue for FREE. (Just cover shipping)

👉 Click here to tell me where to send it!

Index Funds Are Top-Heavy — What To Do

The top seven companies in the S&P500 — the so-called “Magnificent Seven” — are up more than 50% year to date.

The other 493 are basically flat, barely rising 5%.

The world’s biggest index funds are more top-heavy than usual.

How should this affect your client’s investments? 

A few megacap companies — Apple, Microsoft, the usual suspects — make up 34% of the S&P500. Which begs the question:

Should your client just invest in megacap stocks?

Long term, index funds perform reliably well. But some studies suggest that the lopsided nature of the S&P500 could be a problem if it starts to decline.

In a time of stock inequality, maybe your client could get more bang for their buck by going straight to the biggest, best-performing stocks.

They could throw some money into a megacap ETF; Vanguard’s is up more than 21% year to date, compared to the S&P500’s 11.78%.

Here’s a text you could send to your client to show them you’re on top of things 👇

Hello [client’s name], hope all is well. Listen, a large portion of your investment is in index funds like the S&P500, and long-term that remains a smart thing to do.

But I’m concerned about their top-heavy nature this year. A handful of giant companies (Apple, Google, etc.) account for a massive chunk of the S&P500. Some studies suggest this could be a problem moving forward.

Want me to walk you through some alternative fund options on the phone this week?

The Best Thing I Saw All Week

The bond between this elephant and its carer is enough to make a grown advisor cry.

Clearly in a playful mood, it didn’t let its beloved carer leave without a fight.

First it wrapped its trunk around him, then its tail, then it pulled him off the back of a motorbike (gently).

They say elephants find humans cute. Watching this video you can believe it.

Next step: find where to buy a pet that weighs four tons…

Sharing looks good on you.

When you copy that link at the bottom and share it with a few financial planning colleagues, you look like the smartest advisor in the room by keeping them informed.

Plus, you earn rewards. Sweet.