Episode 2 – Upside Insights with Chris Palmisano

Do you want to know how you use your IRS or Employers 401K to invest in Real Estate? Chris Palmisano of Rocket Dollar gives tips on how you can use these accounts to invest in real estate.

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Transcript

Jessica: Hello everyone I’m Jessica Lee-Wen, director of marketing at Upside Avenue. Thank you for joining us for Upside Insights where we check in with investment experts and get their opinions on how we can live our Upside. Today I have Chris Palmisano, CEO at Rocket dollar with us. Hi Chris, how are you doing? 

Chris: Hi Jessica, I’m doing well. Thanks for having me on. Happy to be here. How are you? 

Jessica: I’m good-good. How are you holding up during the pandemic? Have you learned anything new about yourself while being stuck at home? 

Chris: Yeah, you know it’s a-it’s an interesting thing I have found to- I’ve learned a lot of my Home Office which is the loft in the in the condo that I live in. But yeah, I actually. I’m spending a lot of time with the dog which was just really nice. But beyond that, no like I think they’re the lucky ones and we were able to, you know, move to the House and just keep working. 

Jessica: Good, fantastic, that’s great to hear. So, you know, you’re with Rocket Dollar, you know, kind of a take on an SDIRA. So, to give us a little bit of information on how does an investor use an old IRA or employer 401K to invest in real estate? 

Chris: Sure, yeah. So, well we live in this world now where most people stay at their employer for somewhere around two to three years. And then they move on. So, 10 years into their career they probably have three or four retirement accounts and maybe an IRA sitting out there somewhere also. So, what that means is you’ve got this capital there and maybe you’re managing it closely. Maybe you’re not. Most people actually don’t, but there’s also millions and millions of Americans who love real estate, or they have some sort of expertise in real estate. One of the most common credentials in America besides the high school Diploma is a real estate license, and it’s up until now it’s been really, really, really difficult to invest your 401K or your IRA money or any other retirement account money into real estate. And, so, what Rocket Dollar is all about is trying to make that process as easy as possible to give these investors who have this expertise or this desire for additional diversification and easy ability to do so. 

Jessica: Great, so, tell me a little bit more about what some of the benefits are with investing in real estate with an IRA. 

Chris: Sure, well, so, historically we’ve always talked about diversification and that was typically stocks and bonds, and they had correlations such that when the stocks went up, the bonds went down, or when the bonds went up the stocks went down or they didn’t move in the same direction in overtime, over the last 10 years, they’ve really started moving in the same direction, so, the correlations have changed. Bonds used to act as the ballast, but that’s not necessarily the case anymore. We believe the days of the 60-40 set it and forget it or over, and so people need additional diversification. And as I was mentioning, there are millions of Americans with expertise in real estate, or they know something about real estate. Or maybe they have some information about a property that’s in the neighborhood or not far from them. Or they might have professional contacts that are syndicators. So, adding real estate into the portfolio can help to diversify the portfolio further and then look whether we like it or not. Some people don’t trust the public markets, they don’t trust Wall Street. That’s not really our message, but for people for whom that is the case, should be able to invest in real estate and then all of the same benefits that would typically accrue in a retirement account you can maintain if you’re investing in real estate inside of retirement account. 

Jessica: Ok, great. There are a lot of different custodians out there, so why use Rocket Dollar? 

Chris: Sure, well, so, I mean rocket all was started by alternative asset investors, so, we all either came from investing in real estate or investing in private companies, startups, venture capital funds, crypto currencies in some cases even gold. All of us came together and said there should be an easier way to do this and decided to-decided to solve the problem. And, so, one thing led to another and then here we are two and a half years later and we have Rocket Dollar. But what really makes us different is we come from this world and we started out trying to build a product with an end-to-end technology solution that makes the process really simple and seamless – gives investors what they want while not getting in their way. In today-today, I think that’s what-that’s what-that’s what our customers. And that’s what investors really want, is the ability to do what they need to do to do it from their phone or over the web, and to make it really, really seamless for them. So, that they don’t have to call customer support and sit on the phone forever. 

Jessica: So how is it different from traditional SDIRAs? 

Chris: Sure, so, one of the things that we offer is the checkbook product, which basically means that you can get a checkbook that’s attached to your IRA, or attached to a solo 401K if you’re self-employed, and this makes investing in real estate or any other alternative asset really simple. You can write a check to make the investment, and without having to go back and forth to the custodian and send it on the paperwork in you manage the account. I mean it’s called self-directed for a reason. So, this gives you the ability to-to make those investment decisions and then take control over that retirement account. 

Jessica: So, it sounds like it’s cutting out that middle-middle man that middle step. 

Chris: Yeah, to some extent, that’s exactly what it’s doing. And then because we sit in the middle of all of the players that are involved in here to include our custody partners and our investment partners, it becomes one seamless experience for the investor. 

Jessica: Wonderful, Rocket Dollar does really sound like a new and interesting take on SDIRAs. Thank you Chris, for talking about the benefits of using your retirement account to invest in real estate. We are opening up our survey to find out what investment and financial topics you want to hear in 2021, so, watch your-watch out for that survey in your email and our social media platforms. If you enjoy receiving information in this format from us, click that button to follow us on social media or subscribe on YouTube, thank you again Chris for joining us and thank you everyone for listening in and stay safe everyone. 

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