Lauren Wells teams up with Ramez Fakhoury of the IRA Club to explore the benefits of self-directed IRAs and how they can help you take control of your retirement investments. Learn about diversifying beyond traditional stocks and bonds, and discover how you can make smarter investment choices with your retirement savings. Whether you’re new to self-directed IRAs or looking for ways to maximize your current investments, this episode provides valuable insights into unlocking new opportunities and ensuring financial growth for your future.

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Learn How To Invest With A Self-Directed IRA With Ramez Fakhoury

Welcome, everybody. Thank you again so much for joining us. My name is Lauren Wells. I am excited to partner with the IRA Club and specifically Ramez Fakhoury who will be speaking all about self-directed IRAs, the IRA Club, and what it looks like to utilize a self-directed IRA. I’m going to quickly walk through a little bit about 7E. If you’re new or this is your first webinar with us, I’ll walk through some of the highlights of who we are, what we do, and what we offer. We’re going to talk about 7E, the IRA Club, and the power behind self-directed IRAs, and then we’ll have some Q&A at the end. Feel free to drop your questions in the Q&A so we can go through them as we go.

Who we are and what we do, we are a real estate investment company based in Virginia. We like to say we fix and flip mortgage notes. We are investing in first-position mortgage notes that are secured by single-family homes throughout the United States with significant equity. What we’re doing is we’re buying these loans at a discount, increasing the value by getting the borrower reperforming, so back on track, and then selling the loan for a profit back on the secondary market.

That fix-and-flip analogy is easy for people to typically understand because most people are familiar with or have watched one too many HGTV shows about fixing and flipping homes. That is a very brief summary of what we do. We do have other webinars. You can check them out on our website. You can also email us and we can send you to them to break down that process.

Our mission and part of the Reg A, so being open to accredited and non-accredited investors, was through Chris and my experience investing with self-directed IRAs and cash, we realized that there were not a lot of opportunities for people to have access and have available options to people who are not accredited. Meaning, you don’t have to meet a certain income requirement or net worth requirement. Maybe there were options available to those people, i.e. the masses, but the initial opt-in might have been $50,000 or $100,000. For someone who’s just starting, that’s a lot.

Our mission at 7E was to create an investment vehicle that’s typically reserved for ultra-high net worth and institutional investors and make it available to everyone at a low minimum. We’re making it available and accessible to the masses. With that, the Regulation A+ Offering was born. It’s open to accredited and non-accredited investors. We have a four-year term on that.

The minimum investment is $5,000. If you’re just getting started and you’ve never invested in an alternative asset or something outside stocks, bonds, and mutual funds, $50,000 is a lot to throw into a deal for your first time. $5,000 is our minimum. We do start offering bonus shares at $25,000 and then anywhere from an 8% to 10% preferred dividend that is annually paid monthly.

This is open to IRA accounts and cash accounts. Qualified and non-qualified is how those are categorized. We do pay dividends monthly. Every month, you tell us where you want your dividends and it appears in either an IRA account or your cash account. It is a non-correlated asset class. People are looking at the stock market stressing out of the volatility and ups and downs. What we do is not correlated to the stock market at all.

Additionally, we have ample equity coverage. A question that comes up a lot is, “What happens if the value of the homes drops?” We’re looking at an LTV on our portfolio of about 50%, meaning the $500,000 home would have to drop below $250,000 for us not to be covered. That’s the LTV. We are also buying these at a discount. There’s even more of a buffer.

To speak to what happened in 2008 when home prices fell, the height of where they fell was 30%. What we’re seeing is not 2008. This is not a lender-induced recession. Something important to us is collateral coverage. This is not a blind pool. We have an active portfolio of under 100 loans and we are constantly raising and deploying capital.

There are no fees. Chris and I come to it as investors who were once not so long ago, sitting on your side of the table and looking and evaluating tons of deals, we were constantly being fed to death. There was a management fee, an acquisition fee, and an account fee. That 10% quickly becomes a 6% return. There are no fees and all offering expenses are paid by the company.

For tax purposes, if this is outside of your IRA, it is a 1099 dividend. You may look into that. There might be some tax alpha there. I’m not a tax professional, so please consult your CPA. From our experience, this isn’t our first rodeo. We’ve managed five previous offerings that have met or exceeded investor expectations. We have a vertically integrated team. This means that when you speak with us from onboarding as an investor to management, you know you can call Katie or Tony or you’re going to speak with Katrina.

Introduction To Self-Directed IRAs And IRA Club

Everything on the investor side is done in-house as well as our acquisition and asset management which allows us to move through assets quicker and that, in turn, produces a higher return. Historically, we’ve never missed a distribution to our investors. With that, I want to introduce the actual presenter of the hour. We have Ramez Fakhoury with the IRA Club. He is one of the vice presidents there. He has a wealth of knowledge and tons of experience in the industry. I could say all great things about him, but I’ll let him speak for himself. 

Honestly, I’m boring. We had this conversation before everybody jumped on board. Who cares about me? Let’s get into the meat of everything. Before I do, let me start by saying thank you for having me. One of the things that I love about you because I do join some of your webinars is you always make sure it’s educational face-first, which is one of the pillars of the IRA Club. That’s because we can never choose the investment for the investor. All we can do at the end of the day is provide the information, educate people, and let them think outside the box. That’s what I’m here to talk about, harnessing the power of your retirement account through self-direction.

 

To be clear, for those of you who have maybe never heard of the word self-direction, it means control. It’s an adopted word within our industry. That’s what we’re going to talk about. I am the Vice President of the IRA Club. I’ve been with the company for almost nine years. My wife has been here for fourteen years. She helped start the company with our president Dennis Blitz. Most people don’t know that. I don’t even announce that.

I love that you guys offer a reg A. I first met you guys at an event. I travel all over the country. I speak at 30, 40, or 50 different events a year. We have a team of five that goes everywhere you could think of. One of the hardest things to find is something that you could offer to non-accredited investors. More individuals are getting wind of self-directing. They’re sick and tired of the volatility of the market, especially in the last few years. That’s the name of the game. You have to diversify your retirement portfolio to stay ahead of it. That’s what the IRA Club is. That’s what we offer our clients.

The best analogy I always like giving Lauren is when they say, “Who is the IRA Club?” Many of you who are reading have IRAs, 401(k)s, 403(b)s, 457s, TSPs, HSAs, checkbook IRAs, and checkbook solo 401(k)s. I could keep going on the type of retirement accounts. There are also Coverdell plans. For all of that that sits within Fidelity, Vanguard, or Schwab, I guarantee that 70% of you who are tuning in have an account with one of the big three.

When you think of the IRA Club, I want you to think of the big three. There are 10,000 other brokerage firms that are out there, but what are the differences? They’re only going to let you invest in what Lauren said, which are stocks, bonds, mutual funds, and publicly traded REITs. That’s all you could do within your IRAs and 401(k)s versus the IRA Club.

We allow you to not only invest in the stock market. Remember, we do have that option for our clients. You could still do the stock market with us, but we let you do alternative investments. We take the control away from the Fidelitys, Vanguards, and Schwabs of the world and give it to our clients so you guys can invest in what you guys know and understand best. The IRA Club was founded by Dennis Blitz, a very well-respected man in our industry in 2008. We have over 15,000 clients. We manage $1.25 billion under administration. We’ve helped educate one-on-ones for probably 250,000 people, if not more. That number could be skewed a little bit. It could be a little bit more.

Diversifying Beyond Stocks And Bonds

I always like starting off with the simple question, how safe is your retirement account if we’re looking at it today? Think about this. Every single thing is working against your retirement account. The stock market is volatile. We know that taxes will never be cheaper than where they’re at. That almost guarantees that in the next ten years, they’re going to head in a different direction, which is going to be up.

How safe is your retirement account? Every single thing is working against it—taxes, market volatility, and even government programs. Share on X

Number one, we know that pensions are no longer being offered, but not only are pensions not being offered but every single government program that we have is in complete shambles from Social Security, Medicare, and Medicaid. In fact, in the last couple of years, we’ve dished out about $2.4 trillion in social security alone. That’s not a sustainable number. We need to think about what’s going to happen.

The reports came out from the Treasury Department a few months ago that by 2030, we’re only going to be receiving 80% of our Social Security. The three proposals that they gave us, you’re going to die laughing. It is to raise taxes, which we know the wealthy are not going to want to do or raise the minimum age to 70. That’s not going to happen, or they might consider that. Lastly, and we talked about it, lower the amount that people are about to get.

You have to think about what the next eight years of your life look like, especially as you’re approaching retirement. You can’t live off of what you’re making and have that Social Security check, which is a national average of under $2,000 because inflation isn’t going anywhere. It’s trending in the right direction. It took over a year and a half to get it in the right direction. We still got to get it.

The Importance Of Alternative Investments

I don’t know about you. I don’t think it’s at 3%. I still go to the grocery store and go shopping for my kid. I walk out with two grocery bags and it’s still $300. I’m thinking to myself, “What did I buy?” I don’t know where these inflation numbers that they think that they’re kicking in. The point that I’m trying to make is diversification is the key. The only way that you could protect your retirement account is to think about not just the stock market and put all your eggs in one basket, but you have to look at alternative investments. That’s the truth. You also have to think of double-digit returns.

In the actual breakdown of our IRA Club members from our 15,000 clients, the stock market is still there, but you still look at heavily favoring real estate syndications, private placements, US bonds, oil and gas. This is what we typically see. Crypto’s a little bit in there, but this is the general chunk of what we see here at the IRA Club.

Let me make a point. It’s interesting. When we talk about self-directed IRAs, we’re always talking about how it gives you the flexibility to invest in everything outside of stocks, bonds, and mutual funds, but it doesn’t take that ability away. That’s important because sometimes, people think it’s either or. They’re like, “Do I still need my Schwab account and a self-directed account?” I love this breakdown because it shows that people are still doing that. You still have the ability to do that. It’s not something that goes away. You’re just given more opportunities. 

Common Misconceptions About Self-Directed IRAs

You hit the nail on the head. We don’t have a problem with the stock market. We like the stock market. We don’t think everything should be inside the stock market, particularly your retirement dollars. Keep in mind that the IRA Club has a trading platform. It’s not that we’re against it. We teach people how to utilize it to their advantage. For 90% of millionaires, this is the truth. They diversify not only their personal dollars but also their retirement dollars in the same manner. I’m going to break down some of those numbers a little bit later.

This is where we met. I’m all over the country. You see my schedule. I know you’re laughing because I’m never home. My wife wants to shoot me half the time. My kids are starting school, which is the reason why we like it. They’re heading back and my wife could have a little bit of peace of mind. It’s the challenges that we face within the self-directed space. The one thing that I can’t do for you is choose the investment. It’s always the same four topics of concern.

It starts off with a lack of education. I hate to say that most Americans are not financially literate in the retirement space. This one, for me, is the best of all. They learn it. They understand it. They’re like, “I’m too old. I don’t think I should get started right now.” I look at them and say, “The average American lives to almost 80 years old, or better yet, when is it ever too late to tell Uncle Sam to kick rocks?” 

You have to think about accelerating your wealth. It doesn’t matter what age you start because those funds are also passed along to your spouse and your heirs. It’s about accelerating your wealth, number two, which is the biggest one. That’s the reason why I personally love 7E. It’s not an endorsement. I can’t endorse any company. It’s because you offer a reg A. That’s one of the hardest things to get within the self-directed space. You know this firsthand.

When I go to events and ask individuals, “How many of you have retirement accounts?” 95% of people in the audience will raise their hands. The next question is, “How many of you heard of self-directed retirement accounts?” About 60% or 70% of the room will raise their hand. A few years ago, that was probably about 10% to 20%. The very next question is very alarming, which is, “How many of you self-direct?” Out of a room of 1,000, maybe 3% of individuals will raise their hand. 

How do you know what self-direct is? That astounded me as someone who grew up around real estate and around investing. This was something that you’d think a lot of. Going into Silicon Valley and working in software sales, you’d imagine that these people are super smart and they’re making a ton of money. How do they not know about self-direct? It blew my mind.

It’s not something we’re taught. Think about it. When you go to school, it’s not something I ever learned in economics or something when I sat at the dinner table with my mother and father. We were always taught, “Go to school. Get a higher education. Get a job. Take the employer’s 401(k) match.” That doesn’t work anymore. You’re still making that 4% to 6% return, and that does not keep up with the pace of inflation.

The point that I was trying to make a split second ago with the Reg A and the events that I attend, it’s the fact that they do know what a self-directed retirement account is but they can’t identify the investment opportunity. You hit the nail on the head. When they go inside these events and there are all these sponsors out there, they only want to talk to accredited investors.

Most Americans only have between $40,000 to $60,000 inside their IRAs and 401(k)s. They’re not willing to put their entire nut inside of one asset class, especially with a company that they don’t know or met. In this case, non-accredited investors want to self-direct. They can’t identify or find these investment opportunities. That’s why I’m super happy that you guys as an organization and a company, number one, educate individuals but also offer something to non-accredited investors for a minimum of $5,000.

Lastly, leading into who’s taking all of the risk, you know and I know that the only time that you get paid in the stock market within your IRAs or 401(k)s is when the market is up. If the market is flat or down, who’s taking the risk? You, the broker-dealer, or the fiduciary? It’s always going to be you. It’s not that we have a problem with fiduciaries and registered investment advisors. We have 1,000 registered investment advisors that utilize our services. It’s more so that most fiduciaries don’t know about self-directed retirement accounts. They create these artificial restrictions that say, “You can’t do that. You’re going to cause a prohibited transaction,” or, “Take a 10% penalty or you’re going to trigger a taxable event.” That’s not the case.

When you have a 401(k) or IRA in Fidelity, Vanguard, and Schwab, you are moving it over to the IRA Club as a transfer from one custodian to another or from one trustee to another. There’s never a taxable event. Also, understand that there is a little bit of a fear factor that individuals always talk about. You have to take educated, calculated risks. Otherwise, you’re stuck where you stand.

It’s also important to talk about the history of retirement accounts. They were established back in 1974 because fewer pensions were being offered. We didn’t know that every single government program would play a factor in all of this. The only four things that you cannot invest in within your IRAs or 401(k)s are collectible, life insurance, an S corp, and any one of the disqualified persons. Who is that? Your spouse, your kids, your grandkids, or your grandparents. Think of a linear ladder up and down. Those are the only people that you can invest with or within their deals. Everybody else is fair game.

The term self-direction in Dennis’ eyes, our president of the company, is a gift. It’s one of the most underutilized gifts that we could offer to all our investors because it offers you true flexibility to invest in what you know and understand best. It’s a flat fee model. There is something that I will offer to all 70 clients, not to mention the tax-free or tax-deferred growth. That’s what all our IRA Club members are thinking. They’re like, “How do I avoid this SOB that’s always got his hands in his pocket?” Half of what you make in your lifetime is always going to go to Uncle Sam.

The one thing that most people do not know and something that I want to educate you on is when you utilize retirement dollars to invest in the alternative space or the stock market, you eliminate all taxes across the board, State, Federal, Medicare, and Social Security. In this case, I live in the great state of Illinois in Chicago. It’s not a corrupt state at all. I wanted to drive this home. If you’re looking at State, Medicare, Social Security, and health, 14.5% right out the window is tossed out the door. For the federal tax rate, everyone’s federal tax rate is higher than the next. I happen to be in the highest one. You’re talking about eliminating almost half of what I make when I utilize retirement dollars.

You may live in Florida, Texas, or Alaska where there is no state income tax. That’s great. Some of you happen to live in California. That could go up to 13%. It depends on what you live in. You have to play with these numbers. The point I’m trying to make is you will accelerate your ROI by 25% to 50% faster, depending on how much you invest and the timeframe in what you’re investing within your retirement account.

I want to tell you the difference between when you’re utilizing your personal dollars versus using traditional dollars versus using Roth dollars. The only difference between traditional and Roth is when you are going to pay the taxes. That’s it. For traditional, let’s say you have an IRA. You could contribute $7,000. It’s $8,000 if you’re over the age of 50. That’s a tax deduction. You’re going to get the deduction upfront. If you use the Roth, you’re going to pay the taxes upfront on the seed.

It’s simple math. If you had a rate of return of 10% for the next ten years, and I always like to look at retirement accounts decade by decade when you are investing, and you had a $100,000 balance and you’re making a contribution of $7,000, take a look at what your personal dollars at Chase Bank of America or whoever you’re using would’ve given you on the $100,000 at a 10% return versus traditional versus a Roth. It’s almost $120,000 when you utilize a Roth IRA. That’s the power of compounding within a Roth tax-free.

Always consider utilizing Roth dollars. We’re huge advocates of the Roth dollar. Who’s in the driver’s seat? Who do you think’s in the driver’s seat? Is it us or is it them? In fact, 97% of Americans hold their retirement funds in only three places, which are banks, annuities, and the stock market. For the sake of time, I’m not going to get into banks and annuities. For banks, I see some in bank CDs for 5% for 6 months, 9 months, or 10 months.

Annuities, however, have been very heavily marketed. In particular, the fixed income annuity, they’re offering somewhere around 5%. What they’re going to guarantee you is, “You don’t have to worry about the volatility of the market. You could go ahead and move your $250,000 within your 401(k) plan over into an annuity. We’re going to give you 5% for the rest of your life.” For those of you who are tuning in, please tell me that you could do better than 5%. Lauren, what is your rate of return you said?

8% to 10%.

You’re paying when? Monthly distribution? Enough said. I’m going to leave it at that. I’m going to keep my mouth shut right over there. There’s nothing wrong with bank annuities and CDs. To each their own. I’m not saying what to do with your money. I’m saying there are better options that are out there. You have to educate yourself and see what’s out there.

Of the bank CDs and annuities, that’s only about 5% to 6% of the $44 trillion that’s sitting out there. The majority of our money is sitting within the stock market earning between 6% to 7% every ten years. That’s what I’m talking about. Diversification. You have to be able to create double-digit returns because Fidelity, Vanguard, and Schwab don’t care. Here are the reasons why. We’re going to break down numbers.

This is according to Fidelity and CNBC. You can Google these numbers. These are not numbers I don’t have to say out loud. I got this from a search. In 2024, by the end of the 4th quarter, 401(k)s had 135,000, IRAs had 130 on average, and 403(b)s had 115. Fast forward to 2022, there was a drop off of 23% according to Fidelity. It is 20% within IRAs and 19% within 403(b)s. Fast forward to 2023, it dropped 23%, but there was a bounce back of 14% within 401(k)s, 12% within IRAs, and roughly about 11% within 403(b)s. That’s great. Most investors don’t realize what they’re giving up. Lauren, what’s your most important asset, would you say? Is it money or time?

Time.

Time is your most important asset. When all of your money sits within a 401(k), you lose control. If I told you there were twelve recessions in the last couple of years, and I’m not going to go through all 50 recessions, but many of us remember the 2008 crash. People lost 57% of their 401(k)s and there was nothing that they could do about it.

 

Imagine if you were thinking about retirement or approaching retirement. You are 58 or 59 years old. You’re approaching retirement and you had $500,000 inside your 401(k) and it went to half. It took 4.3 years of your life to get to that breakeven point. That means that a person who thought about retiring at 60 is going to have to retire at 64.

Fast forward to 2022, the pandemic, the S&P 500 lost 20%. I told you that in 2022, you lost 20%. The IRA lost 20%. It bounced back 14%. In 2024, it’s up 6% for 401(k)s. What I’m trying to say is you are still at that breakeven point, if not a percentage less. I don’t know what the rest of 2024 is going to entail. We don’t know who’s going to become the president. I’m dealing with the Democratic National Convention. It’s chaotic here in Chicago. I can’t wait to leave half the time. Here’s the point I’m trying to make. You lost three years of your life to get back to that breakeven point. The ugly truth is these plans are designed to benefit them. They do this through artificial restrictions. Be very careful.

Control your retirement dollars. Don’t let market volatility dictate when you retire! Share on X

I don’t know if you know this, but I’ve been seeing this more often. Fidelity, Vanguard, Schwab, and other classical brokerage firms have been teaching their fiduciaries and registered investment advisors to say, “We offer self-directed retirement accounts here. Why are they sending it over to the IRA Club?” What they’re telling their clients is, “You could choose from our pool of investments, but if you were to tell your client, “I found this investment opportunity with 7E that’s offering 8%, 9%, or 10% returns on investment,” they’re going to say, “What?” to you if you had a 401(k). They can’t do that. It’s not part of the pool of investments that we have. What they should be saying is, “You have to roll it over to a true self-directed IRA company.”

The average 401(k) starting balance in 2022 we said was $135,000 and $130,000 within an IRA. I’m talking about all retirement accounts outside of minor accounts. This was the average of what we see here at the IRA Club. Numbers don’t lie. We could see everything here. In 2022, it went up to $284,000 versus it dropping down 20% within the 401(k) and IRA. In 2023, it is under $290,000. Why? It’s because they’re simply in control of their retirement accounts. That’s it. They’re diversifying it.

Here’s another ugly truth. What if I told you there are 65 million IRA accounts across the country of which only 2 million of those accounts have $1 million or more? That’s it. Of 65 million IRA accounts, only 2 million accounts have $1 million or more. What are the 63 million accounts doing wrong that the 2 million accounts are doing right? They’re investing their way through self-direction.

Did you know that there are 65 million IRA accounts in the U.S., but only 2 million have a million dollars or more? Invest smarter! Share on X

Here are the fees we’re going to talk about. Let’s break this down fast. In the average 401(k), and Google these numbers too, within the first five years, they will eat you alive at 4.2%. 62% of Americans don’t even know where to find these fees. 18% of Americans know how to calculate these fees, but when you take a look at the national average within the first five years, it’s 4.2%.

These are the fees you need to be aware of, the 1215 fees, upfront load fees, redemption fees, backend fees, and exchange fees. Make sure you know what these fees are. I refer to them as termites. They nitpick at your retirement account. They traditionally tack up to be somewhere between 1%to 3%. Think about that. For every $100,000 that you have at Fidelity, Vanguard, and Schwab, they are taking a bare minimum national average of $1,500. Always know that.

Versus IRA Club, IRA Club is a flat fee model. We don’t believe in percentages. It’s $195 to become an IRA Club member. Each investment is $195 per asset. Per alternative, a house on 123 Green Street was $195. If you invest with 7E, that’s $195. If you do a life settlement, that’s $195. If you do oil and gas deals, that’s $195.

Think of the Costco model or the Amazon model. That’s what I like to tell people. That’s how the IRA Club makes its money. Let’s take down that structure. It’s the same concept, $100,000. If you have an account that you roll over from Fidelity, Vanguard, and Schwab for the next ten years at 10%, IRA Club will save you under $70,000 in fee structure alone.

Imagine if you made 12%, 14%, or 16% returns. You could potentially save $110,000 in fees. This is not Lauren’s money. This is not my money. That’s your money that they’re taking away from you. Understanding the differences between percentage-based models and flat fee models is huge when you’re looking at things again decade by decade.

What does the IRA Club offer you? It is a true white glove service. Lauren knows this about our company. We’re not a call center. You call, you get the receptionist, and you ask to speak to your IRA Club representative. Remember that your money is FDIC-insured. Remember that we have a trading platform In fact, we’re the first self-directed IRA company that offers an AI-drive platform called SmartFolios with a tech company that we partner with called iFlip. That has been around for nine years.

We don’t have a problem with the stock market. We learn how to use it. If you’re getting a dividend from Lauren for 10%, you could throw it and choose a stock option. The money stays all in-house. It officially makes it a one-stop shop, if that’s what you want to call it. It’s a streamlined process through e-signature processes all across the board. Everything we do is encrypted. Tax reporting is all done by the IRA Club, including the 1099-R and 5500 forms.

Remember the fee structure that we talked about, it is flat fees. What does the process look like? Open, fund, and invest. It will take you 8 to 12 minutes of your time to open up an account. All we need you to have and be prepared with is a government-issued ID, your beneficiary’s information, your Social Security number, and your most recent statement unless you’re making a contribution.

Part two is funding. There are only three ways that you could contribute to an IRA or 401(k), which are contributions, which I explained what they are. That is unless you qualify for a solo 401(k). If you do qualify for a solo 401(k), I highly recommend the solo 401(k) versus the IRA. There are much higher contribution limits. You don’t have to worry about UBIT or UDFI, and you could borrow against it, not that you should ever be borrowing against your retirement account. There are also IRA-to-IRA transfers and old employer plans. The last thing which I can’t do for you is choose the investment. That’s where you reach out to Lauren and her team.

Since we are dealing with a reg A and I want to help not just the accredited but the non-accredited investors, it wouldn’t make sense for me to charge you $195 for a membership fee and $195 for the asset fee. For 7E clients, it’s $150 including the asset fee. Lauren, is this one of the cheapest fees you’ve ever seen in our industry? Out of curiosity.

Yeah, it is. I’m going to put this disclaimer out there. Everyone has to do their own due diligence. If you want a self-directed account, do your own research. We bring on partners that we’ve met and we’ve spoken with in person. I visited the offices. You are speaking with human beings when you call in. It’s not a big call center. There’s not a lot of automated, “Press this. Press that.” You’re speaking with a person in the alignment of wanting to help not only accredited and high net worth but also educate and give opportunities to accredited and non-accredited investors.

That’s honestly one of the reasons why we appreciate you guys. I’m going to be upfront. I don’t care about $150. I swear to you. It’s not about $150. It’s about getting the word out. Once you learn this concept, what you’re going to do is you’re going to educate your spouse, your kids, your grandkids, and your friends, and it becomes a domino effect.

I was thinking, “I’m going to take this webinar and send it out to my old colleagues who aren’t on our email list,” because I feel like this would be a very educational tool for them, especially when people are switching jobs and getting laid off. Having retirement 401(k)s, what are they going to do with them?

How To Get Started With IRA Club

It all starts with going to https://www.IRAClub.com/Partner/7E-Investments. You need to use the promo code 7E. Otherwise, we don’t know that it came from 7E to offer you that $150. You could also schedule a call with our client care team, in particular, Mandy and her team based out in Idaho Falls. We have Sabrina, Lily, and Mandy. Schedule a call with them because you may not know what type of retirement account you want to move over.

Keep in mind that you don’t have to roll everything over to the IRA Club. You could wet your beak. You could move over $20,000, $30,000, or $40,000 if you want at a time and then diversify it any way you see fit. We have thousands of clients here that have accounts in multiple different places. Keep in mind. It starts with onboarding. Mandy is the person that you want to get in contact with. Schedule a call with her. Visit IRAClub.com. You could schedule a call with her there or any one of our team members.

Lastly, once the account is opened, don’t worry about anything else. We’ll do the funding for you. If you have an old employer’s plan, we do have an ACAT system. It’s not that I want to get into this, but we could physically go and move not just funds but stock options over to the IRA Club because we have a trading platform. You could sell the stocks on our trading platform and go do alternative investments. There are a lot of things that we offer here within the IRA Club but you need to sit down and talk to us and spend about 10, 15, or 20 minutes at your time. Everyone’s goals and situations are different from the next if that helps.

Someone asked if you could give the URL again. We’ll send the recording out as well. The URL is https://www.IRAClub.com/Partner/7E-Investments. Someone asked that. There are also two questions about fees and how it works. Jim asked, “The $195 fee is one-time or annual if you have more than a single investment with 7E. Is each individual investment a separate $195 fee?”

Flat Fee Model Vs. Percentage-Based Model

This is a special offer strictly and only to 7E investors. It’s $100 for the membership and $50 per investment. I do not offer this to anybody else because I’m trying to help the non-accredited investors here. The people who only take advantage of self-directed retirement accounts are accredited investors only. That bothers me deep down inside because the truth is less than 9% of Americans are accredited. For those who don’t know the differences between accredited and non-accredited, can you please explain that?

For an accredited investor, you have to have a net worth of $1 million excluding your primary residence or income for the last three years, $200,000 if you’re a single-income earner, or $300,000 if you’re a dual-income household.

I’m not sure if you said not including your primary residence. I’m not sure if you said that. 

The net worth doesn’t include the value of your primary residence. That’s correct.

I just want to make sure. The average American only has $38,000 inside an IRA and 401(k), all qualified retirement accounts. If your minimum investment is $5,000, how can I charge $195 for the membership fee and $195? You won’t make anything. That’s the point I’m trying to make. 

To recap, it was $100 plus $50 for each investment with your 7E investor. 

That’s correct. If you’re a 7E investor, it’s $100 for the membership and each asset is $50. If you ever want to use our trading platform, it’s for free. We don’t charge an asset fee. iFlip does charge a subscription agreement, which is $7 a month, but IRA Club does not make a single penny or a dollar if you guys want to use our trading platform. Why?

Lauren, for example, has given you a dividend every single month. You got $5,000, $7,000, $10,000, or $12,000. What do you think our IRA Club members are doing? They’re shifting it back over to Fidelity, Vanguard, and Schwab. You don’t need to do that with us. You could keep it in-house here and grow it so you could reapply it into the next deal. There is one thing that I want to drive home before we go to Q&A. Lauren, correct me if I’m wrong. Before I jump into the question, I wanted to introduce you to the youngest IRA Club member who is 27 days old. Her name is Ava Marie Fakhoury. She’s my daughter. Can minors invest in 7E’s Reg A?

Minors cannot invest in 7E’s Reg A, but you can invest on behalf of your minor.

You could invest on behalf of your minor. If a minor wanted to open up a Roth IRA and, let’s say, Ramez Fakhoury put $7,000 inside Ava’s account, can I invest on behalf of Ava’s Roth IRA within the reg A?

That’s a good question. I’ve never had that question come up from a qualified account. I believe yes because you are overaged. You’re the owner of it. She is the beneficiary.

She’s the owner. I am the beneficiary until she’s eighteen years old.

That’s correct.

I’m asking because maybe you need to make sure that your compliance team asks them that question.

I’ll look into that. That’s a unique one. The team says yes.

Here’s the point I’m trying to make. If you were to open up a Roth IRA for your children the day that they’re born, $7,000 increase it, and you were to hit the same concept from the age they were at, one year old, until they qualify to touch the money, 59 and a half, at 10%, all you would have to do is make that initial contribution of $7,000. Nothing else. Leave it alone. That’s under $2 million within a Roth IRA tax-free. Picture that.

As much as I love all you guys that are tuning in, I will give your child a free IRA account their first year with the IRA Club, and then you could throw them inside that $150. I want children to get involved in this because they have something you don’t have, and that’s time, the power of compounding. I hope that was educational.

We have some questions. The membership fee is yearly, yes?

Yes, it is. It is a yearly fee. 

If it is yearly, it stays at %100 or does it go to $150?

No. It’s $100 for the membership fee and $50 for the asset fee.

That’s for 7E investors. 

Only for 7E investors. I mean that respectfully. Why? It’s because they have a Reg A offering which is nearly impossible to get. Reg A is super hard to get. I know this firsthand because I travel all over the country. There are so many Reg D offerings, whether it’s a 506(b) or 506(c). For a Reg A, and you may help me with this, it is under $3,000 across the country. It could be even less than that.

There are not many.

They’re very hard to come by. Even though you may file for one, they’re not typically active or taking on funds. That’s why I’m trying to think about you guys, meaning the non-accredited investors.

That 7E pricing stays at that, correct?

Yes. It stays at that forever. If you go do other alternative investments and you grow it, whether you use our stock market option for free or whatever, then it’s still $50.

That’s a good point to make. It’s not just 7E. Let’s walk through this. I have a 7E investment and I say, “I’m with XYZ custodian. I want to roll it into this.” It might be another self-directed custodian. It doesn’t even have to be Schwab. It could be another self-directed custodian.

100%.

Let’s say they’re coming from another self-directed custodian and they’re investing with 7E. That’s one thing. Are they paying the $100 annual fee and then $50 for 7E investments and other adults that they decide to do?

All other alternatives. The first time that you invest with 7E, all the rest of your asset classes that you decide to invest in are $50 per asset class.

That’s huge. What if I’m sitting here and I’ve been thinking about investing with a qualified account with 7E but I don’t have a 7E investment yet and I want to get started and have decided to open up an account with IRA Club? Does that pricing still apply? 

No. You must invest with 7E. The whole point of this is to get non-accredited investors to think outside the box and offer them something that is very aggressive. Trust me when I tell you it’s not about $150. I want you guys to think about not just the stock market. Look at alternatives. Otherwise, you’re not going to retire when you want to retire.

The point I’m trying to make is if you start with 7E and you start doing alternatives with them, it applies to everything outside a house. Another private equity deal is $50. If they do an oil and gas deal, it’s $50. If they want to do a life settlement deal, it’s $50. Whatever it is that they want to invest in, it’s $50 more. Can I mention one thing?

Yeah.

You said other self-directed IRA companies. I know what you’re trying to drive home at this point. I want to be very clear. I love our industry because we’re educators at the end of the day. We can never choose the investment for the investor. One of the things that is bothering me about my own industry is that many of them within the last couple of years are switching over to a percentage-based model, not a flat fee model. You need to be careful if that makes sense to everybody. To drive one last thing home, you’re not going to beat it. There’s no pricing at $150 across our industry. I promise you that. I know everybody’s pricing by heart. Lauren knows that. It’s to get you guys started to think outside the box. That’s what I’m trying to drive home here.

We have people who might not be investors with us but might want to open a self-directed account and invest with us. If their first investment is with 7E, does that qualify for the pricing?

If the first investment starts with 7E, that qualifies for the pricing. 

I know I’ve spoken with quite a few people who’ve been looking into self-directed accounts. That’s why I invited you to this webinar. If you’re thinking of investing with 7E, that pricing would apply if it was your first investment.

There was one that said, “Can the dividends be reinvested in the additional fee?” The answer is yes. If you want to reinvest in the same deal, yes. Someone asked, “Are we able to move over if they are not IRAs?” I’ve never heard of those.

I haven’t heard of those either.

Forgive me. 

Rich said he scanned the QR codes instead of a phone call.

Step number one is to set up a call with Mandy. Many times when we open up accounts, most people don’t know what they have. We want to ensure that we’re opening up, number one, the right type of retirement accounts. I see people have traditional 401(k)s or traditional IRAs and they’re opening up Roth IRAs with us. You can’t do that. It has to go from one Roth to one Roth. If it’s an old employer 401(k), it has to go to a traditional IRA unless you qualify for a solo 401(k).

For those of you who qualify for a solo 401(k), you have to be the sole proprietor of a C corp, S corp, or LLC. Meaning, you have to be your own employee. Your spouse is okay. That could be added. It’s a much more powerful way to contribute more money, especially if you set it up as a profit sharing. The problem is less than 8% of Americans qualify for a solo 401(k).

Someone asked, “If someone is in their mid-50s and has a retirement held primarily in traditional and Roth IRAs, will I be able to transfer a small part into 7E, or is the best option to open a self-directed IRA at first even if it’s only $5,000 to $10,000 to start? My challenge has been most of my retirement is where I can’t touch it without penalty.”

You said IRA. If you have an IRA, you can touch it. If you have a current 401(k), you cannot touch it. If you have an old employer 401(k), you can move that over to the IRA Club. To your point, yes it’s worth $5,000 to $10,000. You’re diversifying your retirement portfolio. That’s the whole name of the game. You don’t have to move everything over to the IRA Club. Maybe you set up a call with Mandy. Let’s talk about it. Let’s break down the objective. What are the goals? What are you trying to move over? How much are you trying to diversify? We could even break down charts for you to see what that looks like.

Ramon, I have a call with you. We can talk about what it looks like with 7E. You can set up a call with the IRA Club and evaluate all your options there.

You guys could start by scheduling a call. If you guys are tech-savvy, go ahead and get started. Remember the promo code 7E. You have to put in the promo code 7E.

If you can’t figure it out, I’m sure they can schedule a call and walk through that. You can say you read this episode. Someone asked, “Are the fees annual?” Yes, the membership fee is annual. The asset fee is as you invest.

When you’re having that conversation with Mandy, ask her for the fee structure and she’ll give it to you.

Final Thoughts And Q&A

If there are no other questions, thank you so much for joining us. We’ll send out a replay of this. You’ll see the QR codes on there because you can always scan them in the replay. The link was dropped in the chat. If you can click on that, you’ll be able to schedule a call with an IRA Club member. Thanks so much, Ramez, for joining us. Thank you, everyone, for tuning in. Have a great rest of your week. 

Likewise. Thank you guys.

Thanks. Bye.

 

Important Links

• IRA Club
• https://www.IRAClub.com/Partner/7E-Investments
• https://www.IRAClub.com/Financial-Professionals/Your-Dedicated-Partner/About-IRA-Club/

 

About Ramez Fakhoury

Ramez Fakhoury is an entrepreneur with over two decades of experience, where he has honed his skills in diverse sectors such as hospitality, financial services, and real estate. Serving as the Vice President of the IRA Club, his primary goal is to unlock doors and open opportunities for investors. Ramez is deeply committed to educating and inspiring individuals, empowering them to venture beyond conventional paths and diversify their investments through the power of self-direction. By offering a white-glove customer service experience, he aims to empower individuals to reclaim control over their retirement. “He who is not in control of his money is not in control of his destiny.” With this mantra as his guiding principle, he strives to facilitate financial independence and enable individuals to shape their own destinies. Join the thousands of IRA Club members through this transformative journey and navigate the intricacies of the economic landscape to reach financial freedom.