Recently appointed with Mcguire-Reid Farmers Insurance Agency

by Gina Lynell Smith

Gina Lynell Smith, writer of “Land Banking Lady” wealthblog has recently been appointed with the Mcguire-Reid Agency on Piedmont Ave in Oakland, Calif. She will specialize in Annuities and Life Insurance for families and small businesses. She also is now director of her own S-corporation which will soon be doing real estate sales, interior design, and online travel agency. Wearing many hats, she said, requires her to expand the call name of her blog from Land Banking Lady to “Wealth Life Lady.” She said, she is looking forward to assisting anyone in California with living happily and wealthy. Gina Lynell Smith’s contact information is gina.kmcguire@farmersagency.com

Shave My Boss’s Head!

by Gina Lynell Smith

Keep Track of The Challenge

     Alameda, CA -  In a Mohawk? Or with words in hair-cut letters spelling out “Bosses Suck!”  How shall she do it?

     Her boss who is probably a decent guy in an insurance company in Alameda, Calif. in all other respects, however, in this challenge is–just a boss. He has been yelling, screaming, and foaming at the mouth because their branch compared to four other branches, located closest to the Bay Area, is fifth or last in comparison of these five branch sales for the month. He has now decidedly chosen to initiate this challenge of “Shave the Boss’s Head,” which Gina says makes her thoughts twinkle.

     Gina works at this branch in Alameda, and she has been challenged to bring in enough sales for any one month that would be the most the Alameda branch has ever made in any one month. Her boss, who technically is not her boss, as she is an independent contractor, has agreed to let her shave his head in any kind’ a ‘whacko way’ she wants if she meets the challenge. She has figured out that it would take approximately 215 people to open an account for at least $30 per month. Each one of these people would also get a vote on just how to shave his head. 

     If you want to help, vote, track the challenge via her twitter address, and learn to which company she is contracted, Call 510-521-1521, ext 135 to set an appointment with her. You must be, at least, age 18, be fairly healthy, live in California, and want to see her shave the boss’s head.

     She said she can offer you what the Wall Street Journal called “A risk-free approach to rebuilding your nest egg.”  An annuity, must be opened with at least $100 and add to it monthly with a payroll deduction before taxes—which would save you money on your out-of-pocket income tax costs, or you could roll-over your 401k, IRA, Pension or Bank Certificate of Deposit.

     You can also open any one of several life insurance policies her branch offers for as little as $30 per month depending on your age. She suggests opening one for yourself, your spouse or significant other, each of your children, and for each of your parents who are circling around the age of 65—above or below you can open a Medicare Supplement or Long-Term care policy.

     Gina is licensed to sell Medicare supplements and soon both regular Long-Term Care Insurance as well as California Partnership Long-Term Care Insurance, which will help transfer the risk of paying an average of $6,000 – $7,000 monthly to the insurance company instead of from your own family’s budget. Gina said she learned in her California Partnership Senior Insurance Training Course that a semi-private room in a nursing home will cost an average of $220 per day, which is approximately $73,000 annually.

     Who is expected to pay for those costs if not the insurance company? It is Gina’s guess that more than likely, it will be a financial burden of the adult children who may be trying to save for their own children’s college expenses or trying to protect their families’ legacy. Gina insured her own mother with a Medicare Supplement policy. She said it will help to pay for the deductibles, co-pays and recovery care that Medicare does not cover including some preventative care that she and her sisters might have had to pay for their mother. It will help alleviate some of the long-term care burden, but eventually she and her sisters will have to gather together to invest in another policy to both cover other costs and protect their families assets.

     Yes, shaving the boss’s head is a great revenge, but the greatest revenge in life, Gina says, is to prepare for the future.  We shouldn’t have to work well into our 60’s and 70’s (as Gina’s mother did.) if we have already been productive citizens for more than 25-years.

      Gina believes that if you put 20% of your income per month for 25 years, (no matter how little/or lot you make) you should be able to live off of the annual interest alone (if inflation stays the same). Your children could use the principle, after you ‘kick that great bucket in the sky’, to keep your family’s legacy going or your chosen charity could also benefit. 

     According to Gina you will also reduce your income taxes as certain annuities defer taxes, and you could use some of the interest from the annuities to effectively reduce the cost of life insurance that could build cash value or like long-term care premiums from certain policies that are tax deductible. Gina believes that if you put away 20% of your monthly income every year in a tax-qualified annuity with a fixed rate for 25 years and cover both yourself and your parents for medical expenses and long-term care your families will be better off and you won’t have to suffer working for ‘a boss’ until you keel over. What’s the good in that?

GINA’S BIO:

     Gina is a fairly new independent contractor with this insurance company in Alameda, Calif. She has been a hard worker all of her life. She worked 12-hours per day Monday through Friday in her own home daycare in Sunnyvale for five years in the 1990’s. Sometimes she worked a second job to make sure her daughter had nice clothes, ballet lessons, gymnastic lessons, synchronized swimming lessons, and horseback riding lessons.

     She closed her daycare and moved to the city of Los Banos, Calif. where, she said, you could get more home for your money at that time, and she worked for less pay as a newspaper reporter. The low-pay finally was not enough for family expenses. She decided to finish her college degree requirements while working at several Employment Agencies close to Stanford University and De Anza College where she finished the last requirements to be transferred to Santa Clara University to get her Bachelors of Science in Commerce-Economics.

     Going to school and working was difficult. Gina had to leave her daughter with friends whose children attended the same school as her daughter in Los Banos. It made for a difficult family life, so she let her daughter’s father and his new wife take custody of their daughter from the age her daughter was 14 through 18, and Gina continued to work 12-hours per day as a security dispatch officer while finishing school.

     It was a difficult decision hoping her daughter would have a better life for those four years, and everyday since that decision, Gina has been second guessing herself. Her daughter is now an adult and working on her own.

     Work has been off and on for Gina after College. She did receive her degree and a debt of several thousands of dollars in student loans. She is working to pay the loans back and still trying to better her financial situation. She recently received her real estate broker’s license, and license to sell annuities-life insurance-Medicare Supplements and soon, long term care insurance including California Partnership. She has recently written a revised version of her self-published book, and hopes to start her own business that combines real estate, insurance, and interior design.

Alternative to Social Security, a long-term strategy

by Gina Lynell Smith

Our retirement was to be a combination of Social Security, Pension Plans, and Personal Savings, but today all three are in jeopardy and an alternative is needed.

 

Social Security is billions of dollars in debt-essentially now defunct. Personal savings are in danger of bank failures like IndyMac. Pension plans are either being discontinued by our companies for lack of money, or they are under performing in the volatile stock market and mutual funds or they are at risk like the Enron disaster.

 

What is the Solution? One suggestion is that youth now need to make more than $60,000 in order to save for retirement and continue to pay down the debt of (or be taxed for) Social Security. But, what if you do not have a college degree or even a high school diploma, how will you make an income of $60,000 or more? And during these turbulent times – bank failures, where do you keep your personal savings in order that it will be safe and available when you need it at retirement?

 

Some economists have suggested a government 401k started at birth for low-income kids, but the same problems that we are facing with Social Security today could also become the problems of the 401k. Also two threats to the 401ks are volatile stock market losses and bank failures.

 

In my opinion, carefully chosen land purchased by a self-directed IRA is the answer.

 

In fact, if the banks fail, such a purchase would not be initially effected. The deed of trust or grant deed that was received for the purchase is still good! It is easily transferable and easily inherited. The retiree can sell it to another person in the U.S. or to a foreign investor once it has appreciated in value, or the retiree can lease out the land and live off of the rental income.

 

A low-income(below poverty) child or any child given a valuable piece of land at birth might receive the best protection against retirement our government or parents could give.

 

Imagine, how land ownership would make below-poverty people or any person more productive and more actively involved in the community. The land will increase in value over a time period of 30 – 40 years and many things would then occur.

 

One Scenario would be for the retiree to sell the land and live off of the interest (assuming the banks did not fail.) This one transaction per child would lift several generations out of poverty. The family would no longer have to live off of the government assistance and low wages. The government would also be alleviated, over time, of its trillions of dollars in debt.

 

A $5,000 to $25,000 investment in an acre of land purchased with an IRA results in deferred taxes and could be worth $1.5 million after the 30 – 40 year period. (The government actually spends $25,000 or more in the first five years of a below-poverty child’s life.) The child could actually retire at 40 years of age instead of 67 or 71 expected by the Social Security Department, and he or she would still be able to effectively be trained to work/volunteer in hospitals or senior assisted care programs.

 

Also $1.5 million invested in a T-bill at 4% is $60,000 per year income before taxes. Two years of paying taxes on $60,000 would pay the government back to original $5,000 to $25,000 investment.

 

Even after paying taxes on $60,000, the income is not bad, especially when you are healthy and when healthcare costs have been reduced by the results of mandatory training and volunteer requirements of those receiving the land IRA. Such volunteer work would reduce the salary expense and overall costs of healthcare.

 

The $1.5 million is still available, after death, to be passed on to his or her child, thus reducing the government’s obligation to invest in another $5,000 to $25,000 per acre at birth, but also it reduces the government assistance needed for welfare or AFDC to raise this new child. This new child can grow up with self-esteem knowing that the interest from $1.5 million is available to him or her for college, a business venture or real estate.

 

Another scenario would be to sell the land and lease a portion of it back, use only $500,000 to improve the leased land with real estate income property. The retiree could live on the income of the interest from the remaining $1 million and from the income of the rental property minus the land lease. This scenario is risky, but now the retiree is a productive developer who has created jobs and hopefully is building more wealth to invest in the community.

 

Both of these scenarios rely on the banks not failing. Should the banks fail, the last scenario would be to simply lease the land out for more than $60,000 per year, and the retiree could live on the rental income until death, and such land and income can be passed onto his/her child. Regardless of bank failures, this plan could work.

 

Some considerations need to be in place—how to distribute the land to whom, and which land to buy (most land should be in the U.S., but as land availability decreases, it can be purchased outside the U.S.); Ten criteria must be considered to ensure the land value appreciation needed to reach at least $1.5 million per acre.

 

Read my next week’s post to see “The Ten Criteria Needed for Purchasing Land with an IRA.”

 

Live happy and wealthy!

 

When to Retire?

Land Banking Lady Improving Your Wealth

by Gina Lynell Smith

 

When Should We Retire?

Welcome smart investors, financial savvy, and baby-boomers!

We are all watching the economy today looking for an opportunity to improve our wealth. Our goal, at my corporation is to bring the most updated information to our community. Knowledge about our options is the best way to increase our wealth. We look forward to assisting you in living a better lifestyle, building your children’s or grandchildren’s college fund, or setting up a retirement plan that won’t leave you as a burden on your adult children.

 

I have stumbled upon a great long-term appreciation strategy that is safe and gives us the freedom of self-directing our funds without any penalties or loss of benefits. Sadly, the stock market and money market funds, even with a financial advisor, are not giving us enough money to pay the advisor’s fees and advance us ahead of inflation to create abundant wealth. 

 

Most people do not know that they can rollover their IRA/401k, 403b or other retirement plan into Real Estate. The defined benefits plans do have restrictions of movement, but they can be set up to include a SEP or other IRA, and they can be rolled over into a self-directing IRA if done properly. The following excerpt is just a generalization of what can be done. It is my posted response to “The Wall Street Journal – Retirement Debate,” article “Keeping Retirement Plans on Track When Stocks Fall.” It was about a man in his 60’s who had $400,000 in several assets, and he was concerned about when to retire without incurring a loss. Here is my response:

 

Land Banking Lady

06/12/2008, 01:25 pm

My suggestion to John or any of us baby boomers is to first consolidate all funds and retirement plans into a self-directing IRA. This eliminates most of the difficulties of having such diversified assets. Next, sadly $400,000 is not enough to retire–Most care facilities cost an average of $5000 per month, which means you will need a savings of $2,000,000 in a T-bill or similar that will give you 4% interest earned. This amount will net after taxes $5000 per month. Thirdly, in order to quickly change that $400,000 to $2,000,000, John will have to live off his low-social security for five to seven years or continue to work while John’s self-directing IRA does some safe Land Banking that will appreciate at 38% or higher, and then he can live the good life! He can trade his self-directed IRA for a 4% t-bill or similar, live off the $5000 per month net interest, and leave a legacy of $2,000,000 to his children to use for their retirement.

Obviously, there are some things to consider in the wake of the bank failure of IndyMac, but one benefit is that real estate owned has a Deed of Trust, which can be sold. The answer to the question, “When should we retire?” is when we have enough saved so that the monthly interests is enough to pay taxes and live the same or better standard of living as we have now.

I give workshops on “How to Rollover Your IRA/401k into Real Estate,” and I have a matrix on how to consolidate your retirement assets. Call me at 925-426-1120 or Email me.

Thanks! and Happy Living Wealthy!