Daniel Blue is a Forbes contributor, an author, and the owner of Quest Education.
DanielBlue.me – Access your retirement account penalty and tax-free.
Blueprint to Your Best Retirement – How to Access Your Retirement Account Penalty and Tax-Free
YourQuest – Learn more about Quest Education: premium financial education that unlocks the power of a Solo 401(k)!
3 Value Bombs
1) You don’t have to be smart to be successful. What’s more important is discipline, consistency, work ethic, and being smart enough to surround yourself with people smarter than you.
2) What’s more important than being successful is having discipline, consistency, and work ethics.
3) Surround yourself with people smarter than you.
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**Click the time stamp to jump directly to that point in the episode.
Today’s Audio MASTERCLASS: How to Access Your Retirement Accounts Penalty and Tax-Free
[1:27] – Daniel shares something that he believes about becoming successful that most people disagree with.
- You don’t have to be smart to be successful. What’s more important is having discipline, consistency, work ethics, and being smart enough to surround yourself with people smarter than you.
[2:47] – How can we fund our business with a retirement account?
- Daniel shares a story about how one of his clients was able to withdraw funds from her retirement account using the ‘loan feature’ on the solo 401K program.
[4:25] – All we ever hear about is how we’ll be penalized up the wazoo if we try to access our retirement accounts early… How can we access our 401k and or IRA penalty-free?
- If you have a 401k from your old job, you can convert that into a self-directed retirement account.
- A solo 401k is a unique account because you can invest in start ups and crypto tax free.
[9:01] – What the heck is a Solo 401k?
- A solo 401k is for employers and business owners.
- If you have a business and don’t have staff, then you qualify for a solo 401k.
- Wall Street doesn’t want you to know about the solo 401k because it allows you a lot of freedom to take money out of the plan penalty and tax-free.
[15:07] – Daniel’s call to action
- DanielBlue.me – Access your retirement account penalty and tax-free.
- Blueprint to Your Best Retirement – How to Access Your Retirement Account Penalty and Tax-Free
- YourQuest – Learn more about Quest Education: premium financial education that unlocks the power of a Solo 401(k)!
Boom, shake the roof, Fire Nation. JLD here and welcome to Entrepreneurs On Fire brought to you by the HubSpot Podcast Network with great shows like the salesmen podcast. Today, we'll be breaking down how to access your retirement accounts penalty, and tax-free to drop these value bombs. I have brought Daniel Blue into EOFire studios. Daniel is a Forbes, contributor and author and owner of Quest Education. And Fire Nation, today, we'll be chatting about funding your business with your retirement account, accessing your 401k penalty free. What the heck is a solo 401k and so much more. When we get back from thanking our sponsors, easy to start and built the customize Thinkific enables thousands of entrepreneurs to run their training remotely, to learn more about their biggest deal of the year.
Go to thinkific.com/firefriday. That's Thinkific.com/firefriday. Friday stories are what help us connect and relate, which is why hearing someone else's story to success can help us clearly map out our own. That's why I'm excited to share the female startup club podcast tune in for stories and insights from the world's most successful female founders today, listen to the female startup club, wherever you get your podcasts. Daniel say what's up to Fire Nation and share something that you believe about becoming successful that most people disagree with.
1 (1m 36s):
What is up Fire Nation? So for me, when I was thinking about that question, what came to my mind is my own bias. I feel like you don't have to be smart to be successful. And I know that sounds silly and there's going to be a lot of people that disagree with me, but I believe what's more important is discipline consistency work ethic. You've got to be an excellent decision maker and you do have to be smart enough to know you got to surround yourself with other people who are smarter than you. So you don't have to be a straight, a student and a excelled in your sat scores to, to be success.
0 (2m 9s):
I'm going to add enthusiasm to that list that you rattle off. There is a great Kevin Kelly article, where he made the comment. Enthusiasm is worth 25 IQ points, and that's always stuck with me. And if I'm not a super high IQ guy, I at least try to be enthusiastic. So think about it. Fire Nation. Think about it. Now, as I mentioned during the introduction, we're talking about how to access your retirement accounts, penalty and tax free because Fire Nation, it takes money to make money. And when you have money to sit in, there could be opportunity loss. So let's jump right in to the juiciness of today's focus.
0 (2m 48s):
How can we fund our ideas, our business with a retirement account.
1 (2m 54s):
The best way to answer that question JLD is, is to paint a picture. And there's always one of our customers that comes to mind. She came from corporate, she wanted to start an online business. She needed about $20,000 for product inventory. And she had money in an IRA and she called her financial advisor. She wanted to withdraw the money out. And her financial advisors was like, no, you, you can't do that. You can only use your retirement account to invest into stocks. And that frustrated her. We ended up talking to her and help her understand that she actually could take her IRA and move it into. What's called a solo 401k. From there. She was able to take out the 20,000 penalty in tax-free by using what's called the loan feature on the solo 401k.
1 (3m 38s):
And she used that 20,000 to invest in her business. And from there, she was able to grow her business. She actually paid her retirement account back because it is a five-year loan where you're paying yourself back plus interest. The interest is fixed prime plus 2%, sometimes 1%. So we're telling people it's about 5.2, 5%, but the interest goes right back to your retirement account. So she's just being her own bank. So she replenished her retirement account. And then she grew her business to the point where she quit her corporate job, and now runs her business from home full time. Makes enough money doing that in a big reason. Why is she was able to access the money in a retirement account penalty and tax-free to start her business.
0 (4m 23s):
Fortunately, all we seem to ever hear in the news and from other individuals is how much we will get penalized up the wazoo. Literally, if we try to access our retirement accounts early, so Daniel
1 (4m 46s):
If you have a 401k from an old job or an IRA, you can convert that into a self-directed retirement account. And, you know, I know there's a lot of you that are listening that probably have heard of a self-directed IRA and a self-directed IRA allows you to invest into some of the things that JLD. I know you love crypto angel, investment startups, private companies, private equity, precious metals, real estate, things of that nature, right? So you could do all those cool things with a self-directed retirement account. But what I want to spend a little bit of time talking about with people here educating is what's called a solo 401k. And this account is unique because the solo 401k can invest into crypto.
1 (5m 29s):
It can own precious metals. It can own a piece of a small startup and that investment can grow and it can grow tax deferred or tax-free. But what makes the solo 401k unique is it has a loan feature where you can actually withdraw 50% of the account value or 50,000. Whichever number is less take that money out penalty and tax-free, and then use that money. However you want. We had a client the other day, where they owed a bunch of money in credit card debt. They were paying 20% interest. They want to get a loan from the bank, but we all know it's hard to get money from the bank when your credit score stinks. And you've got a lot of personal debt. So she used a solo 401k to pay off for 20% interest rate credit card debt.
1 (6m 13s):
So she's saving a lot of money from the interest and then her credit score goes way up the roof, right? So now she can go get that line of credit or that cheap loan from the bank. So the solo 401k, it's almost like a Swiss army knife. You can either use it to own the asset and it is owned without triggering penalties and taxes. Or you can just take the money out as a loan and then not be restricted on what you can and can't do. And you can use the money. However, you'd like, as long as you pay the money back, there's no penalties and taxes.
0 (6m 43s):
I mean, Fire Nation. I hope you're realizing what opportunities you have with what is truly your money. So again, of course, we don't want you to be penalized. We don't want you to have to spend money just to get money, but these are definite specific tactics that are proven. The Daniel has had clients go through where they're not able to access this capital and use it for right now for the present for opportunities that aren't going to be here in 10, 20, 30 years. Whenever that timeframe is when you're going to be able to actually get into this stuff, according to the quote unquote government's law. So we have so much to talk about when we get back from thanking our sponsors, it's hard to believe we're approaching the end of another year and now more than ever.
0 (7m 28s):
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0 (8m 12s):
The ability to curate data sets for faster and more consistent reporting, keeping everyone on the same page at all times, learn more about how we HubSpot CRM platform can help connect your business at hubspot.com. Being an entrepreneur is not all about the money all the time, but ultimately without it, you can't grow your business and Ernie sustainable income. So imagine if there was something that you could do to earn passive income on autopilot with little to no time commitment after launch. One of the most effective strategies that we use here at Entrepreneurs On Fire is to host and sell online courses on Thinkific. And by sharing your passion and expertise in an online course, you too can monetize your skills and earn a highly profitable stream of passive income.
0 (8m 54s):
Don't just take my word for it course, creators on online course platform, Thinkific earned over $200 million in the first six months of 2021. If you're an entrepreneur at business owner or freelancer starting, your own course can help you reach your financial goals. That's more money in your pocket along with more freedom to focus your time and energy on what really matters to you. Whether it's taking a vacation or ensuring you have a nest egg for the future. And for a limited time, Thinkific is launching their biggest deal of the year. Visit thinkific.com/firefriday. That's Thinkific.com/firefriday. Daniel, I heard you mentioned the solo 401k when we were talking about 401ks and IRAs and all this stuff.
0 (9m 35s):
Can we dive a little bit more into that? Because that was even kind of a new phrase for me and I kind of semi consider myself financially savvy. At least I used to be, and I try to keep up with things as, as you did mention, I've now been dedicating most of my focus on crypto and NFTs and that stuff. So I haven't really kept up with the traditional financial markets so much about what the heck really is a solo 401k,
1 (9m 55s):
Good old fashioned 401k. So it's not like it's some new account JLD that just came out. It's been around for decades. The difference is, is it's a 401k for the employer, for the business owner. So if you're listening to this right now and you have an online business, or you're a freelancer consultant, you get 10 99 income as a real estate agent. Basically, if you have some kind of business activity going on and you don't have any W2 employees, then you qualify for a solo 401k, and 401k's, they, they, they get a bad rep. And I understand why a lot of people think 401ks are trash and I get it right? Like a 401k you get from your nine to five day job.
1 (10m 35s):
You're so limited, right? You can only invest in a couple of different mutual funds. You're not calling the shots. Your employer is your company that you work for is so you're really limited. Whereas the solo 401k is going to be tied to your own LLC. Your S-corp your sole proprietorship. Like it's tied to you being the entrepreneur, you being the employer. So now you get to call the shots. So you're able to have a lot more flexibility and you keep in mind, if you work in a day job right now, maybe you work a nine to five job, but you've got this side hustle and you, this business activity you have going on on the side, doesn't involve any W2 employees. Then you still do qualify for a solo 401k.
1 (11m 18s):
And then I'm just going to be very real with people. I might ruffle some feathers here, ultimately wall street. Doesn't want people to know about a solo 401k, because you know, as you guys are listening, it allows you a lot of freedom, a lot of flexibility to take money out of the plan penalty and tax free. It allows you to use the money to invest outside of mutual funds or Tesla stock. Think about that. That's taking money away from fidelity, from TD Ameritrade, from wall street. Why would they want to bring this kind of information to the public? But it's out there. I mean, you can Google all this stuff and it is IRS approved legitimate plans. It's just not talked about a lot from CPAs and financial advisors.
1 (12m 0s):
And that's why I love our mission and what we do.
0 (12m 3s):
I love ruffling feathers. So I'm really glad you're doing that on Entrepreneurs On Fire, because that's what we're here to do. Fire Nation look out for you not look out for the man or the woman we're looking out for you, our listeners, and speaking of which five nations listening today, Danny, because they want financial freedom. They want wealth creation. So we've been talking about it all episode, but we want your best stuff. How can we create wealth tax free?
1 (12m 31s):
One of my favorite parts about the solo 401k is it has a, a Roth contribution bucket. And let me make sure that I don't, that I'm super clear here. So basically you, when you put money in an IRA or 401k your tax, one of two ways, it's either, pre-tax where you, the money you put in, it's a tax write-off and the money grows tax deferred and down the road, you're going to have to pay taxes on that money, right? You're just kicking the can down the road. Eventually you're going to be taxed on the money when you take it out until then it grows. Tax-free that's one way, the other way to put money into a retirement account, like an IRA or 401k is a Roth contribution. And this works the opposite way.
1 (13m 11s):
The money you put in your you're taxed. However, the money that grows from that contribution, it grows 100% tax-free and it stays 100% tax-free. So with a Roth solo 401k, the contribution limit, you can put up to $58,000 per year into the plan, depending on how much business, how much income comes through your business. And to kind of give some perspective, a Roth IRA only allows about 6,000, maybe 7,000 a year, depending on your age. So there's a big difference between 6,000 a year and $58,000 a year, right? So if you put $58,000 into a Roth solo 401k, and you invest that into crypto, let's just say hypothetical.
1 (13m 55s):
And that 58,000 grew to $200,000 over a period of time. Now that $200,000 is 100% tax free. And you know, your ears are probably perking up right now. You're like, what the heck? How is that even possible? Well, that's what makes the solo 401k so powerful. And one thing to keep in mind is a Roth IRA. Like JLD I know you make too much money to get a Roth IRA. You're real transparent with your website and your income IRS. Ain't going to let you get a Roth IRA, bro, but you can get a Roth solo, 401k doesn't matter how much money you make. There's no income restriction. So you know, a lot to unpack there, but if you like to pay taxes on the seed, but you want to see the harvest grow tax-free then a Roth IRA or a Roth solo.
1 (14m 43s):
401k is a good place to start
0 (14m 45s):
So much value here, Fire Nation. And you need to realize you're working hard for your money. Now let your money work hard for you. And these are some ways to do just that. So Daniel, you've been creating a lot of stuff over time. I know you have some really cool things that have been coming out in 2021. And you've got some big plans for 2020 to talk to us about books, projects. What do you really want to make sure foundation is aware that you're creating on a content product and service level so that we can continue our education in this area for,
1 (15m 17s):
If you go to Daniel Blue.me, that is my website. And on there, I've got my book, it hit Amazon bestseller. It's called Blueprint to your best retirement. And that's a book that I wrote where the intention behind it JLD was, you know, I know the financial world can get kind of boring, right? Like how many times have we gone to an event? And someone starts talking about insurance or wealth management and investments. And like, they're spitting fire. Like it's good information, but five, 10 minutes into it. You're like, man, this guy is dry. Like what time is lunch? Let's get out of here. Right? So I, I know I'm not in the sexiest of industries. And a lot of times these, these terms go over people's heads.
1 (15m 58s):
So my book Blueprint to your best retirement, it dives deep into the solo 401k and self-directed retirement accounts and accessing your money penalty and tax-free, and some of the things that we touched on, but I intentionally wrote the book or it's simple, short, sweet to the point I dumbed it down. I wanted people to read it in an afternoon, read it in a day and then walk away with tactical information that they can immediately move forward with and start seeing results.
0 (16m 26s):
Where can Fire Nation go to get all of this good stuff? I want to hear your website one more time. Well, let's make it happen.
1 (16m 32s):
Yeah. So it's Daniel Blue.me is my website. And then there's a link for the book. If you go to Amazon and just type in Blueprint to your best retirement, that's where you can get the book, a paperback or a Kindle. And then I do have something special or the Fire Nation here it is your quest.com backslash fire. So your quest.com with fire at the end. And that is going to be a place where if you have a, for a 401k from an old job or an IRA, and the idea of accessing that money penalty and tax-free appeals to you, maybe you want to use that money to fund your business. So you can leave your corporate nine to five job, or you want to use that money to invest into crypto or pay off high interest rate credit card debt, click that link.
1 (17m 21s):
And there's a way for you to get in touch with us. And then also I know JLD that you've got some people that listening, maybe the person I'm talking to right now has some kind of offer where they teach people how to make money online. For example, maybe they help people with Shopify stores or FBA stores, Amazon stores, and they're selling, you know, services to teach these people how to make money online. And you know, maybe your clients, they need capital like need funding for inventory. They need funding for your mastermind. They need funding for your coaching. Well, people can invest with you using a credit card or cash, but as you mentioned earlier, JLD the retirement account side of things.
1 (18m 2s):
And what I'm talking about is a great way to unlock some other money. So this could just be another tool in your tool belt to help your clients unlocked more money so they can be set up for more success in working with you. So we do have a, an option on the, your quest.com forward slash fire that says, if you want to be an affiliate click here, and we do have an affiliate program where, you know, we have the ability to make it a win-win for all of the referrals that come our way. So we can just help everyone. When
0 (18m 31s):
I love all of this Fire Nation, because you are the average of the five people you spend the most time with. You've been hanging out with DB and JLD today. So keep up the heat and head over to EOFire.com type Daniel in the search bar in the show notes page will pop up with everything that we've talked about here today. Yourquest.com/fire. Fire Nation. Take action, go check it out. All the Austin misses there and Daniel, thank you brother, for sharing your truth, your knowledge, your value with Fire Nation today, for that, we salute you and we'll catch you on the flip side. Hey, Fire Nation today's value bound content was brought to you by Daniel and Fire Nation, successful entrepreneurs accomplish big goals.
0 (19m 14s):
That's why I created the freedom journal to guide you in accomplishing your number one goal in a hundred days. And we're talking step by step, visit the freedom journal.com and I'll catch you there, or I'll catch you on the flip side, easy to start and built the customized Thinkific enables thousands of entrepreneurs to run their training remotely, to learn more about their biggest deal of the year. Go to thinkific.com/firefriday. That's Thinkific.com/firefriday. Friday stories are what help us connect and relate, which is why hearing someone else's story to success can help us clearly map out our own.
0 (19m 58s):
That's why I'm excited to share the female startup club podcast tune in for stories and insights from the world's most successful female founders today, listen to the female startup club, wherever you get your podcasts.
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