The warm climate and abundant cultural, outdoor, and entertainment activities makes California a popular retirement destination.

Whether you’re interested in the character of San Francisco, the southern California beach communities, golfing in Palm Springs, sipping wine in Napa Valley, or the perfect climate of San Diego - California has a lot to offer retirees.

However, the cost of living, particularly housing, is high and can be an obstacle for many looking to retire in California.

This is where Lasaii may be able to help make your retirement dream come true. At Lasaii we have been helping clients use their qualified Retirement Plans (i.e. IRA, 401k rollover, SEP, etc.) money to support real estate purchases since 1992.

The advantage that a proprietary, IRS reviewed, Safe Harbor® Directed IRA™ from Lasaii offers you over a Self-directed IRA real estate purchase is that with the Safe Harbor® method, you can occupy and enjoy your new home today! This means that while you are preparing and planning for your dream retirement you could get to know the area and people better by vacationing there while staying in your own home. Or, you could rent it out and use the income to help cover your every day needs.

We can help you get started on your California IRA Real Estate purchase today.

Thanks for visiting our blog. As always comments and questions are welcomed and appreciated. We would love to hear about your California retirement or California retirement dreams.

Please visit our website to learn more about Lasaii and the Safe Harbor® Directed IRA™.

Sign up for our Free Monthly IRA Real Estate Newsletter.

Other articles that you may enjoy:

Safe Harbor Directed IRA (Video)

Safe Harbor Directed IRA vs. Self Directed IRA for Real Estate

Can You Lie on Your Beach?

Buying real estate with your IRA can be an attractive proposition - and it does work out well for many people. The key is that you need to have a clear idea of the purpose for your real estate transaction, and you need to understand the rules and limitations associated with how you choose to use your IRA when purchasing your real estate.

The most common and well known method of purchasing real estate with an IRA is with a Self-Directed IRA.  However, using a Self-Directed IRA to buy real estate can offer many pitfalls and challenges for the unaware buyer.

A prospective client came to see me last week. He and his wife had used a self-directed IRA to purchase their “retirement dream home” in Washington a few years ago. When they purchased the property, they were made aware of the “arms length” rule which prohibits investors, their families, or business partners from living in, or using property that is owned in a self-directed IRA.

They were however led to believe that they could occupy the property upon retirement, without being notified of the tax implications that such a move would incur.

It is only now, as they are preparing to retire and to relocate to Washington State, that the tax ramifications of moving into their IRA Real Estate “dream home” have become apparent. Unfortunately, this is not an isolated or unique incident, but one we see quite often.

Common pitfalls associated with Self Directed IRA real estate purchases include:

·         You cannot live in or use property that is held in a Self- Directed IRA without facing severe tax implications. This restriction also applies to your family and/or business partners.

·         You cannot sell property to your IRA or buy property from it without tax implications.

·         You cannot borrow money from your IRA or lend money to it - you cannot jointly purchase the real estate with your IRA

·         The IRA is responsible for, and must cover all expenses associated with the property.

·         You must value the property annually which could lead to costly assessment procedures.

·         Depreciation of property is not allowed.

·         IRA real estate can create problems at 70.5 when you have to start taking distributions, unless you have other IRA funds available. If you don’t have other funds available to cover the distributions, liquidity issues could force you to sell your IRA real estate at that time.

·         If, at your death, the IRA real estate property is passed on to your heirs; depending on the size of your estate, and the state in which you live, it could be taxed at a rate of up to 70% on a zero cost basis of the full market value of the IRA owned real estate.

Our perspective clients are now hoping to sell their Self Directed IRA Real Estate, then find and purchase another “dream retirement home” in Washington using a Safe Harbor® Directed IRA™ instead. If they can sell their home, and they qualify for the Safe Harbor® Directed IRA™, they will be able to move in and occupy their new retirement home as soon as they are ready. In the meantime, they could use it as a vacation home, or rent it out for additional income.

Thank you for visiting our blog. As always, questions and comments are welcomed and appreciated.

To learn more, please visit our IRA Real Estate website or subscribe to our free monthly newsletter.

Related articles:

Introduction to the Safe Harbor Directed IRA (Video)

IRA Primary Residence

Self-Directed IRA Real Estate vs. Safe Harbor Directed IRA Real Estate

Use Your IRA to Invest in Real Estate

Last March, Time Magazine developed a list of the “25 Best Financial Blogs,” and almost a year later, the list remains invaluable. Not only does it tell you which blogs are good, but it tells you why they are good—what these bloggers focus on, what their specialties are, what kind of information and slant and expertise you can expect to find when you visit each site. (You can find the full list here.)

What do you think of Time’s list? Whose blog is missing from the list? What is your favorite financial blog? Why do you love it? What keeps you coming back?

At Lasaii, we want to make our blog a useful tool for you. We want you to learn something every time you visit our site, and we also want you to be able to talk with each other—about retirement, about investments, about real estate, about how to best plan for your future. We look forward to the conversation. 

 

 

 

At Lasaii, we help people use their IRAs to buy real estate they can live in (check out this short video about how to buy real estate with your IRA.) Many of our clients use their IRAs to buy second homes, to pay a mortgage for a home they already own, or to buy a home where they will someday retire. The AARP ran a story this month highlighting “Ten Sunny Places to Retire.” Their list included the following cities: Asheville, NC; Grand Junction, CO; Sarasota, FL; San Diego, CA; Las Cruces, NM; San Luis Obispo, CA; St. George, UT; Santa Fe, NM; Bend, OR; and Fort Worth, TX.

We’re located in Sun Valley, Idaho—a sunny town we certainly would add to the list—but we bet you have ideas of your own! What city do you think should have been included? Which sunny city do you have your eye on? Or does weather not matter to you? What things are important to you when you consider where you might like to spend your retirement?  

Around here, we love listening to radio shows about money—how to make it, how to save it, how to make it work for you. One of our favorite shows is “Planet Money” (you can download episodes for free here). This podcast also has a blog filled with interesting and thought-provoking stories. Just today they featured a post about just who to blame for the housing bubble—China or the United States. There are also fun stories, too, things like how the Oreo had to be redesigned for the Chinese consumers or how hedge funds can’t foreclose on the Acropolis.

Radio shows offer a wealth of information about retirement. Morning Edition traced the development of the concept of retirement (“What is Retirement, Anyway?”). NPR ran a blog post featuring Facebook users plans for retirement and asking you to share your own plans. And All Things Considered helped listeners figure out if they’ve saved enough for retirement in a show called “Saving for Retirement: How Much Do You Need?”

Which radio programs about financial issues do you like to listen to? Which stories have you heard that changed your mind about something or made you think differently about your own financial plans? We’d love to hear what you’re listening to!

 

(And . . . If you’d like to know more about how to use your IRA to buy real estate, visit our website. You can also watch a short video about how you can use your IRA to purchase real estate you can occupy! We’re here to help and to answer any questions you might have!)

 

 

 

 

 

 

 

Enjoy this 2 minute video explaining how you may be able to use your IRA or qualified retirement plan to purchase real estate that you can occupy and enjoy today!

Thanks for visiting. As always, questions and comments are welcomed and appreciated.

Visit our website to learn more about Lasaii or to set up a Free Consultation.

Sign up for our FREE IRA Real Estate Newsletter.

Although there are a few options for purchasing Real Estate with your IRA, when it comes to purchasing a primary residence there are only two options that apply:

 1. First Time Home Buyer Exception: Under this exception an investor can pull up to $10,000 - penalty free - from his/her Traditional or Roth IRA to use for “qualified acquisition costs” (including the costs of buying, building, or rebuilding a home and any usual or reasonable settlement, financing, or other closing costs).

2.       2. Safe Harbor® Directed IRA™: A Safe Harbor® Directed IRA™ can be used to support the purchase of real estate with your IRA or other Qualified Retirement Plan. The SHIRA allows the account owner to occupy the real estate that is purchased, including a primary residence or vacation home.

Thanks for visiting our blog. As always, questions and comments are welcomed and appreciated.

For more information on the Safe Harbor® Directed IRA™ please visit our website or contact a Lasaii consultant.

Sign up for our FREE monthly IRA Real Estate Newsletter. 

According to Vicki Berrong, in a Wall Street Journal article (Moving to Costa Rica, December 19^th, 2011) the phrase “Pura vida” translates into “live is good”, and evidently “life is good” for this retired expat living in Costa Rica.

She describes her early retirement to Costa Rica as being about tight budgets and lots of planning, but now enjoys warm relaxing days full of beautiful ocean views, walks, exercise, naps, reading and new adventures.

If you are considering retiring to a Costa Rica or other foreign country, or even just want to retire to another part of the U.S., Lasaii may be able to help make it easier for you. Our proprietary SAFE HARBOR direct IRA may be able to help you to use your Qualified Retirement Plan to purchase the house of your dreams wherever it may be. In addition, one of the benefits of using the SAFE HARBOR Direct IRA is that you can use that home as a vacation home until you do retire.

Ms. Berrong finishes by writing, “Looking back on our planning and experiences, I’ve learned that dismantling your life and moving to another country is not for the faint of heart. In fact, it’s one of the hardest things I’ve done.”//”That said, my new adventure, to this point, has lived up to - and exceeded - my expectations. As I sit on my porch watching the several shades of pink and red float across the sky as the sun sets across the gulf, I feel like I’m at home.”

It is a great article; you can read it in its entirety by clicking here. If this link to the Wall Street Journal is no longer active, you can also read our archived version here.

Your turn, do you have a retirement adventure that you are working on making a reality? Maybe you’ve already accomplished it? Please share your story - we’d love to hear it.

Visit our website for more information on IRA real estate planning.

We often envision retirement as a time of relaxation and fun. A time stop and smell the roses, pursue our dreams - to enjoy all of those things that we never have time to do in our pre-retirement lives.

Sounds wonderful right?

How many retired people do you know? How many are living the “retirement dream”?

I don’t know what your experiences are, but the people that I know that are retired are still busy trying to keep up with life, commitments, budgets, and deadlines. Sure, they have a little more freedom to travel or plan their days, but they don’t seem to be stopping to smell too many roses along the way.

However, the retirement dream still lives. You can still escape the “rat race”; have your beaches, unspoiled nature, beautiful sunsets, warm weather, and long, slow days.

Until fairly recently, the western-facing coast of Panama’s Azuero Peninsula was difficult to access by car. The area, which boasts beautiful beaches, green hills, world-class fishing, and a sparse population (no cities - Santiago, the nearest City is over an hour away) and few services is opening up to adventurous retirees that are looking to get away from it all.

Kathleen Peddicord, founder of the Live and Invest Overseas publishing group and writer for the U.S. News’ Money blog, recently wrote an article discussing the experiences of an American couple looking to retire on the Western side of the Azuero Peninsula. Six months ago they were alerted to a fully furnished, three bedroom house (built to American standards) that was available to rent in a small development. The house sits on 2 ocean front acres and rents for $200 per month.

 Not ready for retirement yet? Now still might be the perfect time to consider purchasing your dream retirement (vacation) home. In addition to benefiting from today’s low costs and great financing; buying your retirement home early will allow you to use it as a vacation home until you do retire. This will enable you to assimilate into the area slowly over many years, develop friendships and get used to the local culture.

At Lasaii, our goal is to help people prepare for retirement. Our proprietary Outside Method (as opposed to the Self-Directed IRA - or inside method) allows you to use your qualified retirement plan to support the purchase real estate, in the U.S., Panama, or elsewhere in the world, through a Safe Harbor® Directed IRA™ . The primary benefit of the SHIRA™ is that it allows you to live in and enjoy the real estate that you purchase.

Thank you for visiting our blog. As always, comments or questions are welcomed and appreciated. For more information on the Safe Harbor Directed IRA you can visit our website or contact a Lasaii Consultant.

Retired pilot Lee Wendelbo of Oregon spends about 4 months out of the year in the historic city of San Miguel de Allende Mexico where he owns 2 units in the Cruz de San Jose condominium complex.

San Miguel de Allende is a city that is popular among artists, writers, and retirees. Of the 59,691 residents, 7000 are estimated to be American citizens. Visitors and citizens alike enjoy the temperate climate, beautiful architecture, and visiting the many Galleries and shops that line the coble stone streets. There are no traffic lights in San Miguel de Allende, instead traffic is controlled by the strategic placement of speed bumps.

Mr. Wendelbo purchased his first condominium in the Cruz de San Jose complex in 2005 using a Self-Directed IRA. By 2008, he had discovered Lasaii and the Safe Harbor® Directed IRA™ which he used to purchase his second unit.

“What a difference! For three years I owned a beautiful place in Mexico that I couldn’t use or enjoy - it was simply an investment in my retirement portfolio. Now, with the second property, I visit San Miguel de Allende several times a year (about 4 months out of the year), and am able to stay in my own home. The unit is rented out for income the rest of the year.” ~ Lee Wendelbo

The Safe Harbor® Directed IRA™ offers numerous advantages over the Self Directed IRA, but the biggest is that the investor is allowed to occupy and enjoy the property that he/she has purchased. With the Safe Harbor® Directed IRA™, you can purchase your retirement home early, and use it as a vacation home until retirement. This allows you to get to know the community, your neighbors, and your home prior to relocating permanently.

If you would like more information on the proprietary and IRS reviewed Safe Harbor® Directed IRA™, please visit our website or call a Lasaii consultant at 1-800-564-8625.