September 22, 2022

Understanding The Fundamental Problem with Qualified Plans - Billy Keels

In today's solo episode you'll learn from Billy about what a Qualified Plan is, why it's fundamentally flawed, and the benefits of choosing a different investment route.
Billy Keels
CEO and Founder FGCP

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Going Long Podcast Episode 249: Understanding The Fundamental Problem with Qualified Plans

(To see the Video Version of today’s conversation just CLICK HERE. )

In today’s solo show you’ll learn the following from Billy himself:

  • [00:20 - 01:56] Show introduction with comments from Billy.
  • [01:56 - 03:01] Billy shares an honest written review from a GLP listener with the whole Going Long family.
  • [03:01 - 10:31] Billy explains the concept of what a Qualified Plan is, and then also what could be seen as a fundamental flaw in Qualified Plans, and therefore why you might want to choose a different investment route.
  • [10:31 - 11:12] A summary of what we’ve learned today, and Billy shares a resource to help you on your journey to investing success.
  • [11:12 - 08:17] Billy wraps up the show.

To see the Video Version of today’s conversation just CLICK HERE.


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Episode Transcript

Billy Keels  00:00

Today's conversation is sponsored by first generation Capital Partners. If you're an accredited investor and you want to know about how we're helping other accredited investors keep more of their income, go to first gen forward slash going long.


You're listening to the going long podcast with Billy keels, the number one podcast for long distance real asset investing.

Billy Keels  00:22

Welcome to the gold long podcast, we're back once again to continue to help to educate you so you feel much more comfortable as well as confident investing beyond your backyard. And yes, I'm your host, Billy keels, and I'm really looking forward to today's episode, because I'm gonna be sharing that with you. Yeah, I finally get in there, it's taken me a while. But today's another one of the solo episodes, I want to jump in, I want to start right away and recognise one of our wonderful, honest written reviews from one of our, one of our listeners, one of our previous guests, actually this time, and I want to get into today's conversation, because we're going to take a look at something that I know a lot of you have a lot of passion around. It's something that I consistently speak to future or potential future clients around. And this is the whole thing of the qualified plan. And if you don't know the qualified plan, that's actually its formal name, but a lot of you will think about as one of the defined contribution plans, specifically the 401 K. Ira, I want to talk about these qualified plans and what are likely I'm going to spend a little bit of time today and I even will probably talk about it in the next conversation. So like I said, we want to keep these these episodes, these solo kind of episodes, really pretty brief. So that you get not just a strategic look at things, but you can break things down and these concepts ideas and really make them actionable. But so before we jump into that, I do want to recognise another one of our honest written reviews. Once again, these are we're gonna reread me's and because of the podcast, the reach that we have today, it's over 30 countries. And like I said, over 10s of 1000s of downloads. So today's honest written review is comes from Sharon born Holt. And actually Sharon was a guest on episode 107. So if you want to check out Sharon's episode, it was absolutely fantastic episode 107. And she leaves this show is one of a kind, Billy keels does a great job of going deep with his podcast guests. Remote real estate investing isn't always easy. His mission to show people that they really can invest anywhere is not only educating people, but he's making it possible for those same folks to build a business outside of their own geographic location. Whether you're a newbie or a seasoned investor, this show is for you. Well, thanks so much, Sharon, really appreciate that. And once again, check out Sharon's episode, it was 107 She's doing an absolutely amazing adoption, you'll find out all about that and how she's helping make impact on lives, I really appreciate it especially when it gets takes a previous guest takes time to leave a an honest written review like that. And if you haven't done so yet, you want to get your honest, written review read in front of the world. Go ahead and leave it and I'll be sure to read it here because it's the right thing to do. So listen, so other things. So let's jump into this thing about the qualified plan. Right? Because it's something as I mentioned, I speak about it in the calls that I have with potential future clients, the really want to understand the previous investment and so many people the only previous investing experience and I say investing experiences is through the qualified plan of 401k. Typically, sometimes an IRA, sometimes if you're in the government plans, it's pretty much the same. But this whole concept is something that I never really understood once I started investing. I mean, when I didn't invest, I didn't really understand it. So that's what I started doing. But once I started doing it, I didn't really understand. So conceptually, I just wanted to leave you with something today. And like I said, this is these are going to be pretty brief episodes. And it's just I want you to think about what is the right thing for you. I'm not here to say this because you know, what is the destination you're trying to get to? And then what are the different vehicles that you want to be able to number one, understand that you have a support system around and that you can take action on and feel comfortable? How many of those vehicles do you want to use or need to use to get to your destination as quickly as possible? This is another one of those tools, right? A qualified plan a 401 K and Ira is something that you can do. But once I started investing the whole concept around, putting my capital somewhere putting my currency or my money, however you want to describe it, putting it somewhere where you can, I'm thinking about the person who's just getting started, right? You're putting it somewhere, maybe you start you're starting your job, because today people are starting a little bit later, maybe you're starting at 25 You're going to retire at 65 If you're lucky. So that's 40 years. So the whole concept of a qualified plan is it's something that you continue to put your money into. And eventually, you will be able to get it out and you will get that out when you're 65 or 67 or whatever the case may be but you can't touch it at least until you turn 59 and a half. This is going to be very specific Before us based IT people but it conceptually it's the same because I had something very similar until I stopped doing that while I was here in Spain and in France and these countries defined contribution plans are pretty much the same. But the problem is, that I see is that you're placing your money somewhere that you're not going to be able to actually utilise for 40 years. Let me say that again, that you're not going to be able to utilise yourself to pay for anything to use your to, to use in your life to build your lifestyle for 40 years. So I guess in today's conversation, because I said, I want to keep it pretty high, high level, can you imagine and for those of you that are parents, you will definitely understand this pretty quickly. But can you imagine actually having a child, your child your child is born. And then you have all these great ideas, and you know exactly how you want your child to, to to eat, you know, how you want their behaviour to be, you know, how you want them to be to be cultured, or how you want their, even their hygiene to be, and you know all these things at birth, right, just like when you start your book, when you do that when they're born. And you know that it takes a lot of hard work, consistent work, especially very, very consistent work to make sure that over the span of even the first 10 or 15 years that you get on the right track. And that's what you're spending every single day, 24 hours a day with your child when you're not working right. And so the thing is, is that even though you do that every single day, app, children turn out very differently, right? Children are different. They're influenced by different things. They're, they're the outside world, when they go to school, all of these types of things. And they have a major influence, and you're with your child every single day. And so at the end of 40 years, and I'm just starting, I'm not even halfway there yet, with our children, you get some points of feedback, but you get them on a daily basis, especially you know, your kids go away, they come back from people's house, and they say, Hey, listen, your child was really well behaved. And they did this. And they did that. And they helped with this. And so you know that the work that you're doing is actually your children are becoming the individuals that you are creating the environment for them to become right. And so the reason I talked about this is it takes a lot of hard work day to day to day to day to day, to even get started on the right path. And so the thing that I never really have understood and still don't understand to this day is when you are placing your capital for 40 years, and you don't know what your capital is doing. Because most people sign on the line when the person comes in from HR, and you're signing over and you like the fact that hey, listen, you're getting, and I know that a lot of people are already saying, Yeah, Billy, but it's free money, right? Because you're getting double, or maybe they have a 20% match, or they have a 2% match. Some companies aren't even matching anymore. But the fact of the matter is, it's like, can you imagine giving your child to someone on day one, and saying, Hey, listen, I want all these things from my child, I want them to be this way. I want them to have the environment that allows them to do this, and they have this type of education, but you don't ever talk. You don't see your child, you just literally give it to someone else. And you don't even ask maybe every two, three years you check in, Hey, how's things going? Okay, great. And if things are going in the right path, you don't ask any questions, if things are going wrong, you may talk about it and be concerned for a couple of days, but then you just go back to life. So you do a lot of hard work to be able to earn this capital, this money, this currency. And so one of the things that just conceptually without even getting into all the numbers and stuff like that is you're giving your money to someplace where you can't use it for 40 years without the fear of taking a penalty and or the fear of losing it on a piece of paper the value on a piece of paper every day. And so because this is one of the things that just conceptually, like I said, I don't want to really get into a lot of it, but I'd love to know what your thoughts are on this. But in I use the image of someone who's having a child or has a child, because you can relate to that and saying, Hey, listen, I'm just gonna get my child over. I'm not gonna really give much instruction. I'm just gonna say want these things to happen, but you're not actually doing any of the work. So what how would you expect that the environment that you're creating for your children are that your children will be on the path that you want them to be? If you haven't actually dedicated the time to it, that you've given that responsibility to someone. But then even with that someone, you only check in probably once a year. And it's not really a deep dive. It's more I'm just going to tell you the things that are happening and as long as things are happening and you hear that they're happening. Well, you don't ask me any other questions. If they're not, well, yes, two or three questions, but because you haven't really had that much contact with the child you don't really understand you don't really know. It can be kind of confusing. So I just want you to conceptually think about that. It's something that's been on my mind. Hopefully, this is something that makes sense as it relates to the qualified plans and kind of what happens, it's basically give your money someplace 40 years later, you hope that it shows up well, and also you hope that the timing of the market, when you are need to use that is actually going in the right direction, not like things have been going recently. Because timing is everything as it relates to these qualified plans, the defined contribution plans. So listen, hopefully, this has made a lot of sense. Like I said, I wanted to leave this very high level, the next conversation, we're gonna talk a little bit about property, the cash flow, I thought I would be best to do that. So I will do that in the next conversation. But once again, for those of you that are also accredited investors, you're high paid professionals and you are interested in being able to create consistent returns predictable returns, as well as be able to keep more of your money because of being able to find strong deductions for your income tax, I think it would be worth it for you to download our free guide, you can go to get that at first gen, forward slash, going long. Once again, that's forward slash going long. Pick that up, talk about today's conversation, this concept of, you know, the 40 years to before you can actually touch your money and use it on a day to day basis, which is really what you need to use it for. Does that make sense to you? Does it not make sense to you? I'd love to know what you think about in the comment section. Leave it leave your honest written review. Really appreciate that. And while you're working on that, I'll be waiting and getting ready for the second part of this conversation. So go out and make it a great day. And thank you very much. Trust that you enjoy today's conversation and once again, today's conversation was sponsored by first-generation Capital Partners. If you're an accredited investor want to find out more about how we're helping accredited investors to gain their personal freedom even faster. Go to firstge forward slash going long.

Billy Keels
Founder & CEO of FGCP
Billy is on a mission to share a roadmap and opportunities with other extremely busy, high-paid professionals on how to find financial freedom through investments. Listen in to learn how!
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