EP 570 – Rocket Your Retirement With Self-Directed IRA’s With Rocket Dollar Featuring Dan Kryzanowski

NCS 570 | Retirement Money

 

NCS 570 | Retirement Money

 

In most cases, retirement money is squirreled away, untouched until its owner comes of a certain age, but the thing with that is that money could be used a whole lot more productively. The primary case of this is with real estate, where retirement money can be put in and invested, even if you’re not quite ready to dip too much into your retirement fund. Dan Kryzanowski is an active real estate investor who also work at Rocket Dollar. Joining Scott Carson, Dan talks about self-directing your investments, the podcast, his interest in self-storage investments and how you can invest in some large projects using the Rocket Dollar self-directed IRA or solo 401(k) if you are self-employed and some specials for opening a new account.

Listen to the podcast here:

Rocket Your Retirement With Self-Directed IRA’s With Rocket Dollar Featuring Dan Kryzanowski

I’m more excited to have a fellow Austinite on the podcast. Many of you guys know we have such a big network of people across the country. Austin is such a different market but I’m honored to have the self-proclaimed Rocket Man, who’s coming to us from down under at mid-Austin down by off of Camp Mabry at 45 in that neck of the woods. This guy I’m honored to have him on the podcast. He’s doing an amazing job. He’s an active real estate investor and fundraiser leveraging checkbook control, self-directed IRA accounts and Solo 401(k)s to create a diversified real estate portfolio yielding double-digit returns for himself. He specializes in self-storage investments, multifamily, hard money, and residential property loans. He has personally raised millions of dollars from family offices and individuals. He empowered his partners to raise seven figures on multiple occasions. We’re talking about our good buddy and longhorn extraordinary Mr. Dan Kryzanowski with us. How’s it going?

Fabulous, Scott. Thanks for having me. It is a true honor to have two Austinites here. I saw your slate of the first 500 plus and I was a fanboy for everybody. I’m honored to be on the list. I’ll tell you that much.

Thanks. I appreciate it and we’re honored to have you. It’s a great thing that Austin is such a different market for a variety of different reasons. Why don’t you share a little about your background? For those who are reading, we’re going to dive in a little bit on some of the dos and don’ts with checkbook IRAs and some other things as too. Dan, tell us a little bit how you got started as an investor in your backstory.

I shared this in some of our common groups here in Austin. I was born in ‘78, so my first 30 years in life we’re linear. Probably a lot of folks here went to school and went to college. I grew up in northeast Pennsylvania, so to be apolitical for both sides of the aisle. I played on Biden’s Little League field and I rode with Trump Jr. at U Penn. No more politics but I had a great experience. It was the right place right time, Merrill Lynch, GE, and big companies. Coming from Little Scranton, PA, my dad was a high school principal and I was a social worker but did have a good fair amount of family members that were probably the first generation that were entrepreneurs. Some had some land, some real estate so things seeped into my brain a little bit. I had the benefit with GE Capital. I had a taste of Austin.

If you can imagine living on the east side next to Franklin’s Barbecue and I’m giving you a flat-screen TV to move in for a six-month lease. That was my first experience in Austin back when ‘07. With that as a backdrop, I went against my gut, but I did was going to work for the Republic of Tequila the bottles in the shape of the state of Texas. It was the first true organic product. It took us about three more years to get back here in 2011 and right around this time of year, The Kite Festival came down, got a job offer and a one-way ticket. GE said, “Thanks. Good luck in life.” It was probably a pretty good move in hindsight and we’ve been making our way since.

Awesome stuff. Franklin’s Barbecue the best in the world not only in Texas. It’s known on the Food channel and all that good stuff there. He does a great job over there. It sells out often before quite often. Going back to that, what dove into making that change into the real estate side of things going from that? Corporate was one thing and what was your real estate background?

Two things, at GE which is real estate, so it’s your typical CRE stuff, one-minute money claim to fame or Mexico portfolio did not lose money in a way in ‘08, ‘09 on the marketing side there. Coming down here, I was the co-best man at a wedding and the gentleman said, “I flip houses.” I was like, “That’s interesting. What’s that?” He said, “15%” That’s all I heard. That’s all I needed to hear and he said, “Did you know you can use your retirement dollars?” This was the magic rainbow going off in front of me. This was the start of what at least giving hard money loans on the residential side in the early 2010s. The second side of this is either benefit through the Capital Factory network to work for SpareFoot. It was the right place right time coming in with a guy with a little bit of gray hair and was able to double revenue. I put a fair contribution into the ultimate acquisition and I got to realize there were tremendous players, personalities in storage and ultimately, who I felt were some of the top operators and marketers they have since gone on their own.

I evangelize my story of what I’ve been doing. It’s been pretty easy, at least in my opinion, based on my backstory to share how you can go from maybe owning your primary residence, secondary or having a read maybe in your confidentiality 401(k) to being active either personally earning the depreciation benefits, etc. More so, my work in a sandbox is leveraging your retirement dollars, taking advantage of them to have a tangible asset in your community that pays a dividend, double-digit returns with somebody and trust that you can see, feel, and touch every day. That’s a warm, fuzzy in my hypothesis where the mindset of the average Americans going to go with their dollars in 2020 and beyond.

Let’s take a little step back there. You mentioned a couple of things that maybe many of my readers may not know. Can you explain what the Capital Factory is? People are like, “What’s that? Are you trying to impress?”

For those of us who will be here in South by Southwest trust me, you’ll want to get in and have a VIP badge. It’s the glass hotel downtown. It’s basically the center point for everything Austin. It’s has a great backstory. Josh Baer runs it now. On some of the companies that have come out are WP Engine and Spirit for the Course was a great success. What it is, is an incubator. I know folks talk about WeWork and a lot of these other thematic incubators, but this was I’d say the first one, once again, going back pre iPhone almost. Downtown Austin where everybody comes to and I say there’s a tremendous amount of Austin Servant Leadership with the amount of events. The big thing when people look back in Austin in 50 years is there’s many from the DIUx and we’ll call it Military Startups or groups within the broad military.

There are five different offices within a few block radius and the eighth floor where Capital Factory is. My child loves all the robots, but there are some amazing technology ideas and what these guys and gals do on a shoestring budget is amazing. All of this is together collective and all the diversity events you name it. Capital Factory is sharing its magic in Dallas, Houston, and the Texas triangle so. For those of you in the south by it’s almost guaranteed you, at least, whether it’s a startup crawl or a private meeting with some notable folks, you’ll be in Capital Factory. Finally, if you have an idea, I know folk maybe are doing one step above flipping, adding some sizzle to the real estate or real estate tech, you can also hop in for a few hundred bucks a month to grow.

It’s a great place to go, brainstorm, be a nice think tank, co-mingle, rub elbows, quote Vulcan mind-meld with some great people. That’s a beautiful thing. It’s networking and it’s ultimate, for the most part for those that don’t know about it. Thanks for explaining that to our readers out there. You had someone tell you, “You can get a house flipping at 15%.” You started feeling that sizzle and you’re excited about this.

Even now.

Let’s talk about how that evolved from that to where you guys are at now.

This is me personally and also on the side, I felt I was doing the equivalent of crowdfunding before the JOBS Act was even passed. Even from the first bar on Rainey Street and few other things on the east side. I’ve had tremendous success with female entrepreneurs, which the numbers don’t lie plus, I feel it’s impactful. All this money replicates in their sub-communities. On the real estate time as things have gone along, it’s funny. I was on a plane to Money 20/20, which is the large FinTech show in the world. I saw Henry Yoshida, this is after his success with Goldman Sachs buying Honest Dollar. I’m always being a salesman to always be blunt. I said, “Henry, you might want to look at the storage deal.” I shot on a PDF follow up and probably said, “If you fill out these forms and find a fax machine and a scanner, you can use your retirement dollars.” Not knowing Henry’s deep background and that he’s 100 times smarter than me on the retirement side. In short, this is one of the founding stories. There are a few others that put it together for Rocket Dollar.

What we’re doing is democratizing the ease, the education, the empowerment that folks are made where they can use the retirement dollars to invest in notes and private real estate. Secondly, the other thing that we realized early on, these have been around 50 years. It’s not Country Club cool, as they say. Even here in Austin, whether you’re wearing the suit or the jeans and boots, you don’t want to tell somebody, “I give somebody a $25,000 note but I was on the phone for two hours.” I do this quarterly and it was great when I was using my piggy bank checking account but now with this retirement, we’re stuck on the phone all this time. It wasn’t great. Our thought was that being that well over 90% of folks making six figures are completely unaware of this world exist. We want it to make it quick and easy almost if you sign up for Wealthfront or Betterment.com. It’s super easy and to get up and going with a simple person.

NCS 570 | Retirement Money

Retirement Money: Rocket Dollar democratizes the ease, the education, and the empowerment that folks get when they can use the retirement money to invest in notes and private real estate.

 

What do you mean by Rocket Dollar? What is Rocket Dollar out there?

FinTech company in Austin has been around a few years and voted by Money20/20 one of the top two FinTech startups in the world. Shaquille O’Neal swatted us the second which is a fun experience. Rocket Dollar we empower individuals. There are two sides to the coin individuals. Anybody reading here can tap into your old retirement dollars or if you’re self-employed can contribute up to $56,000 a year and having checkbook control. It’s full access to your retirement money at all times to invest in what you want when you want. There are a few minor exceptions such as primarily yourself or your family. Not your startup or your kid’s company. You can’t live in the primary residence but everything else is in play. You want to invest in a crypto fund. You want to do a self-storage facility and do notes. All of that is there so that’s what Rocket Dollars is empowering you to do.

There is some stuff in the background that we take care of, but we call it Rocket Dollar, it’s not rocket science. We also want the experience to be quick, smooth, easy, and no fine print in the pricing. It’s $15 a month flat. There’s no AUM and no per transaction. If you’re making a good investment, we’re not going to charge you more. It doesn’t make sense. Our standpoint from the mission spirit is, even if you’re 25 years old starting career, your middle age, went through divorce, you got to get back on your feet, in good faith at $15 a month and if you have a few grand that you can either roll over putting in this account, in many ways you can be dangerous. Whether it’s from a note, crowdfunding or big property, so we’re empowering all of this ecosystem that in some way we call 21st Century Diversification

It’s helping people put self-directed IRA accounts and checkbook account, correct?

Correct. It took me a little time to think through this, but we even say that Rocket Dollar offers checkbook control self-directed accounts, whereas the other players around 50 years it’s a custodian that offers a self-directed IRA. If I could, to share a little bit in the difference. Historically, you would be able to open an account, but you would not have access to your money. It’s almost checking in with mom and dad. You’d have to fill out paperwork. The person let’s say you were investing with their lending to would also share their paperwork. That would be a lot of checkmarks and there was no value add to the deal. There was no help with the due diligence. It was for, in our opinion, filling up the sake of third-party paperwork.

The best analogy I can give is a health savings account where if we need surgery, we can get surgery. If we fall and break your arm, we want to get manicure pedicures. Whoops, it’s below the board. It’s the same deal. The laws are clear on what you cannot do in these accounts. Based off of that and Rocket Dollars prove this out. The first nine figures of assets, first thousand customers, nobody has played in the gray area because we’ve made it clear to say, “We’re going to give you a checkbook control self-directed account. By checkbook control, you have full access to your money at all times.” For most people, that’s all they need to know. It’s not even, “Is it an IRA?” “Is it a Solo 401(k)?” They say, “I need my money. I’m going to roll it over and for the next four quarters do four $25,000 checks.” That’s great. I hope this takes five minutes of my time every time I do it and that’s what we empowered to do versus maybe spending 5 to 10 hours when they’re writing and giving a loan to their best friend.

Are there not fees in the front end to set up the IRA accounts or the LLCs or stuff like that?

There is an upfront fee with our core product. It’s one time up the front of $360, which is the wash. I’ll get into some of the products trying to do an apple to apples if folks are familiar with this space with the custodians out there. There’s no asset under management thing. There’s no per-transaction fee. It’s like Netflix. You want to go you want to watch Game of Thrones. That’s great. You want to document comedy, great. You want to watch one little program, “I’ll watch Parasite this month.” That’s it. Game set match, but it’s only $15, which is great and it also doesn’t need into your balance. Let’s say you have $10,000 in a Roth, that’s the minimum, you’re not going to wake up and go, “I’m 999,” and can’t get out of the deal. There is an upfront, with that said from there, there’s a few so like the Solo 401(k) is for anybody with self-employed income. What this means, generally speaking, if you have 1099 income, are you or your spouse have a business without W-2 employees so the 1.3 million realtors in the world.

Especially here in Austin, a lot of consultants, a lot of folks that retired to the extent you’re doing a fair amount of gig economy that qualifies you. You can maybe qualify and roll money in or much like your W-2 friends contribute the $19,000 and 20% of your net earnings by this equation up to $56,000. To use as an example, Mary, she’s a consultant, the one-woman shop makes $100,000. The first $39,000 she can contribute to the Solo 401(k). That’s extremely powerful and have checkbook control for maybe $25,000 for knowing that she’s going to do a personal loan for a few female entrepreneurs and a few crowdfunding campaigns. She’d be doing that she could from a piggy bank checking account but keeping all the tax benefits.

The final point, without going too much into detail in the Solo 401(k) umbrella under the single price. You can have a pre-tax checking account and post-tax. Going back to Mary’s little example, let’s say she’s also a mentor a Capital Factory with me, she has the opportunity to put $5,000 in the startup and that’s going to be the next Facebook. It’s kind of the seed versus tree analogy. She would probably want to pay taxes on the $5,000 not let’s take that 20 X in the future of $100,000. That’s something that you can also do within this account. It’s powerful and I share this in a bit of detail and thanks for reading because a lot of the legacy players in the space will not offer this Solo 401(k) or the checkbook control. As more and more of us have at least a side gig, realize that this is available.

That’s a Solo 401(k) that’s the product that we came up with and got the notoriety. That’s where all the VCs out West are. Even Shaquille O’Neal said, “We’ll let you on stage as one of the top two in the world.” That was cool. On the flip side, the self-directed IRA, we do the IRA LLC Model. What this means is that you’re funding an LLC on day one. We have different custodian partners in the background that checks the boxes that say this is a good asset and you have this checkbook control. It’s similar and frankly, that’s where the world is moving to. People want to know what they’re investing in when they’re getting charged. This is what Rocket Dollar does for the individual. The pricing is simple.

One time upfront $360 or $15 a month flat, it’s been beneficial as raising money. I’m sure you’re well aware of this. For folks that are raising money, I’ll preface with you, you’re not getting charged anything or it’s not going to pull you away from your time and resources. We prefer simple copy-paste marketing that you, in turn, can share with your audience. Let’s say you’re buying a house in Cedar Park. You’re going to raise some money for it. You can say, “Friends, you know me, love me and we’ve already been in touch. Did you can also use your retirement dollars to invest?” What you’re going to see lo and behold is say we have 100 people. First, most are going to open the email because they’re engaged with you.

Half are going to say, “This is great. I get to learn in private because some folks are a little introverted or don’t want to be called out potentially.” It’s also cool learning. That’s why in our FAQ in HubSpot, Salesforce, is a partner competitor. For those that don’t know HubSpot, we were voted one of the top FAQs in the world. You can self-educate here. All of this comes in you as the deal sponsor not spewing what I’ve been for the last ten minutes. We have this all on our website and ultimately, within as soon as two weeks, you’re going to get more money from less people faster from their retirement accounts to potentially close.

You’re sending that email out to your database if you’re with a client.

This is for folks that are raising money. You can imagine going to anywhere from a real estate luncheon meetup to some of these shows, there’s going to be investors. On the flip side, many people are raising money and it’s not the easiest thing even for folks pretty tenured out there to raise money. This is an added boost. I know one of our earliest partners John Minus has been doing this, Tommy Prate with Magnify Capital here in town and has been doing this for years. Lo and behold, about 20% of all the dollars that come in are coming from retirement dollars because they have been educated. It’s as simple as a two-sentence paragraph on say, their monthly newsletter or a deal packet and it’s awareness. It’s to show how big the opportunity is for your “old 401(k).”

Let’s assume we all worked in Delaware here in Austin. In the aggregate across the country, that totals $10 trillion and behind that there’s another $20 trillion of say, your current company’s 401(k). Let’s stick with the $10 trillion for now and by the way, let’s not count of all the Uber drivers and the self-employed folks we talked about, that’s probably 40% or 50% By some DCF calculation. With that, of the $10 trillion, only $100 billion only 1% is used in these self-directed accounts. It’s a huge opportunity and as most folks get aware of particularly, it’s something such as real estate. It’s a relatively easy conversation and the simple transaction to set up the account and make the investment.

NCS 570 | Retirement Money

Retirement Money: The demand never really goes away, especially in Texas where there seems to be an influx of newer population.

 

I’m still not following you on one thing. You said that you’ve got some templates that you provide people to talk about and they get set up there dealing with templates. Are you guys sending this out to your client list or is this for us to send out to our clients or contacts?

No. Rocket Dollar is not a broker-dealer. What we’re not going to do we cannot say, “That has a deal in Cedar Park that pays 8.5%.” We do have a partner page, so we do list it. Some folks say, “I get the call. I’ll pick on the doctor, lawyers or the smartest folks out there.” “I learned this thing. I don’t want to pay taxes. I have no clue what to do now.” We say, “Go to our partner page and you’ll see. Here are some self-storage, crypto, and venture fund. We’ll give you a flavor. We mix it up.” What we would do will link back to some folks that we’ve engaged with or potentially. We also do podcasts, webinars or something like Acre Trader if you want to own part of a parcel of an almond farm in California, you can go through Acre Trader. It’s a cool thing that’s fun to talk about. We’ve been on different podcasts and webinars together. Ultimately in this little example of Acre Trader will go back to their clients. We will never say, “Acre Trader returns better than others.” They have to be 1 of 50 folks on our partner page and go from there.

That’s great that you’re showing, “Here are some opportunities. You still have to do diligence on them but these are some people that we work with,” or other things like that.

Think of probably the most widely known example to talk to the more from my folks back home, but the Yale University Endowment. There were a lot of papers that came out in the early part of the past decade. It’s not stocks, bonds, mutual funds and these three shades of grey. They’re also in private real estate or international. They might get some Bitcoin. There are many things that they’re in so we’re pretty enough the pie when you think of a pie chart in terms of overall what true 21st Century Diversification is. It’s not that much of a long shot because a lot of folks here and especially Texans, tend to have a second property and to do some things on the side. With your piggy bank checking account, you do have this 21st-century diversification. It’s amazing how folks for one reason or another think, “This retirement is so far away. I can’t touch it.” What we’re doing is empowering you to have that same portfolio now with your retirement dollars.

Are you looking for people that are looking to start their new IRA, set up the new accounts and start putting into it? Are you looking more for people that already have accounts, maybe they will get the rollover to have more access to their funds and flexibility with what they’re doing?

I’ll say the big yes with the hook them horns. It’s both. You’re right. There is no typical account holder. Aa fair scenario would be somebody married with two kids early 40s. Probably on the VP of some company on their third corporate job, has $500,000 sitting in the likes of fidelity, their buddies are doing some real estate say self-storage and they can put $50,000 or $100,000 in a deal and dip their toe in the water. For them they have an existing retirement account with the existing custodian, maybe they move $100,000 on day one and call it a year or two down the road they considered, “I’m going to move more of this money to private deals.” How do they want to diversify or save the deal they invested in themselves with dividends? They can choose what they want to invest in. That’s one.

The second thing is for the self-employed person and or maybe you’re going through a life situation, post-divorce, etc. Whatever you want to say, the balance of your existence is probably lower than you want it to be. Here’s we can also contribute. It’s like you would at a post, your $6,000 or so a year into your IRA. You can do that into your self-directed IRA. As we talked before in the Solo 401(k) especially, say If you’re over 50 and married, you’re looking at $124,000 and say a gross of roughly $250,000 to $300,000. Even if it’s more of a side gig, you and your spouse, if you’re over 50, here’s $50,000 right off the bat that you’re putting away. We see both and what we’re seeing is some of the fun stories. We’ve had folks as young as eighteen that I talked to. We have somebody in their 90s, one gentleman and a great friend now with the company. He’s a retired pilot, so you’ve seen the world and said, “Wouldn’t it be cool if I’m going to buy a condo with my retirement. I want four other condos in the Caymans or somewhere.” What better use of your retirement than that.

You’ve hinted about being a big fan and knowledgeable in the self-storage side. Let’s get into some of those things there for you. Are you crowdfunding in some different deals or you’re buying some stuff for your portfolio? How’s that working for you to him?

I buy a few things. I love as much as you can tell I love the retirement community. Storage is such a great asset. Let’s I’ll try to go real for my little brain here real elementary to say, we can’t officially call anything recession-proof because one of the rates went down half a point when the rest of our, 30% and 40% in ‘08 and ‘09. It’s pretty recession-resistant. Let’s think about why. Divorce, Grandma dies and the kids are out of town and they’ve got to figure out what to do. In this minimalist, which is great as you can see not much on the walls here but stuff is in storage. This was all Christmas and Hanukkah trees, everything is before me.

It’s cleanliness and finally nonprofit and other endeavors, whether it’s for legal reasons or peace of mind, you have it elsewhere. The demand never goes away and especially in Texas with the influx of population. It’s here. That is the backdrop. It comes down to operations. I spent a lot of time at Sparefoot there talking to top CEOs, top CMOS in the space to get a feel of how do you get more people in the door faster? What is your asset? What is economic occupancy? With all that, for me, my widowed mother, my son that barely came out of the womb, my wife, we’ve invested in storage, and it’s great seeing those dividend checks come in all the time. That’s one.

Secondly, as I share my story, it’s easy for an initial asset because it’s many ways. It’s multifamily and it’s multitenant, but there are not even people, which is something great. The super worst cases if I tell folks, “If it doesn’t sell, you’re probably still going to coupon forever or you have a true brick and mortar property that can be referred.” These are the ultimate worst-case under that mismanaged scenarios that we don’t see. That’s the high level of the market. From here, when folks get a taste, maybe you put in $1,500 and a deal you’re getting your 8% dividend, this is great it looks like the valuations going up. A lot of folks, gentlemen, and ladies are pretty quiet with their money. They may come around and put $500,000 or $1 million. I’m sure you see this with your notes all the time.

They provide good service and return so we’re seeing more of that where it’s not as much the money. It’s still finding the right deals because Time Magazine is still saying if they would put storage on the cover, “Too much supply.” Sure, maybe across the country, but this is a hyper sub market thing and it all depends on what your flavor is. Do you want to be in Fifth Street or downtown Austin and find public storage publicly traded? They’ve got great economies of scale. It’s probably a good public stock to go into. Folks that want to be in places like Boerne, the secondary, tertiary markets, likewise, with the right operations, these can be also lucrative. For those on the call that do the real estate meetups, I’ve heard Brad Sumrok around the world talk about, what’s the potential that you would pay to get a higher return? This is the scenario you can see in storage.

You’re investing into funds and operators on self-storage, is that correct?

This is topical and timely and a great question. I can go into individual properties. Now I would go into smaller funds, I view funds as two things I feel that it’s either this open-ended call it a Vanguard Fund. It’s more publicly-traded where it’s open-ended or somebody raising $200 million for a specific project. I feel that days when somebody says, “I’m going to do a $10 million to $40 million fund and fill it up over three years.” Investors even from high net worth and family office, they’re not as warm and fuzzy. They want to say, “What are you investing in?” Generally, what we see is either it is deal by deal or somebody might say, “Here’s my history. I’m going to raise $5 million for three properties worth of equity. That’s maybe $10 million. I don’t want to be as levered as much and that’s basically what we see at this point.”

It’s a deal by deal transaction not as much into fun. With that said, in between with everything, the key to trust and respect is education, so whether it’s your shows or podcasts there are so many ways to be educated these days but what property? As an investor, personally, I like where there’s existing revenue coming in and it’s something fully baked. Also, knowing that out back there might be a plot of land that we can build some more squares or maybe throw some boats on and pull some revenue. Other folks say, “I love the ground-up build. I love the potential of the 40 IRR. I don’t mind if my money sits.” You’ve got to get to know the operators in the timeline going into it. Also, pulling it full circle, especially even if you’re 50 years old with the retirement account both called the instant dividend and the long-term development play. You can’t touch the money without a penalty until you’re 59 plus you might as well.

I got a buddy Jim Ross, who puts on an online self-storage. I enjoy speaking to him back and forth. I spent some time with him in New Orleans at a virtual summit conference. It’s a small world. It gets smaller every day.

NCS 570 | Retirement Money

Retirement Money: In the next generations, plenty of Millennials will very likely inherit real estate properties that they don’t want to physically touch.

 

Jim’s a great steward of education because I wholeheartedly doubled down for education. If folks want to listen to Jim for storage, he brings out the best stuff. That’s great.

That’s the view. There are some different options out there and here in Texas, we’re blessed as being one of the largest states with one of the biggest footprints for storage facilities that are good ones. If you’re looking to operate one, take one down yourself. There’s a lot of opportunities out there one of the largest networks of members as in the storage community out there. We market that into a drip marketing campaign out on a monthly basis to generate leads. I agree with you. It’s a matter if it’s an up or down market. Self-storage is a solid play because people are always looking to put their stuff away once you put it in there, usually have them hooked for 12, 24, 36 easily.

I’ll give you a funny there’s a gentleman. I won’t share names, but we’re all guilty and he was in Arizona in the early ‘80s. Ultimately married, fantastic, and had no kids but he had dirt bikes. Forty years later, guess what same storage facility in Arizona. He knows that he probably paid $100 for them back in the day and how much he’s paying for storage. He’s like, “There are my dirt bikes in case.”

In case you decide to go out there and do it. I was doing some purging here with the offices and moving stuff. Christmas stuff in and out. That’s the thing too. As we look at what’s happened in the last years especially in real estate, a lot of times, people are buying less houses. The price is going up. Here in Austin, we see that a lot. A lack of inventory. Apartments aren’t made with the same type of storage and we have a low vacancy factor less than 1% here in Austin. When people have downsized or move, they don’t have a place to put their stuff.

That’s why self-storage is done with the good stuff. You hit the nail right on the head. Secondary tertiary markets around those larger markets are great to play too because there’s a lot of opportunities, either the owner-operator even maybe take over something that’s maybe not being managed properly. Are you seeing some of that in some of the projects you’re looked at where people have the opportunity for the value adds taking over stuff? Maybe the owner-operators got into it in retirement and decided they didn’t want another job they created for themselves?

Absolutely and playfully because the first club came in Austin and open it up, I look at my value add outside the window that we have here. There’s a lot of opportunities here in Austin and across the country. You are seeing that. I Airbnb, I felt like Don Draper. I haven’t told my wife about this, but we’re going public now not that side.

Are you saying your war hero stole someone’s identity?

I only said that I’m a dirty New Yorker we’ll put it there. Fun fact, I believe my mom probably dated the real Don Draper back in the ‘60s. Get a few drinks of Franklin’s and she’ll tell you some great stories with that. Somehow in that spirit, I was in a Costa Mesa. I was blessed to be out there in California. My host, we had a great chance to speak and that’s what she said. She’s probably in her latter 50s. No kids or parents directly to take responsibility for. She bought a few places. She did this a few years ago, so she had the benefit of the wave coming up. Her mindset, at that time, was what do I want to do with my time going forward? What contributions and also do I have either the trust or am I going to build up my little management team?

Can I do this myself? Meaning, do you own the place across the street or do you know one property manager for the square mile that has all of these houses? She chose something towards the latter but ultimately, she had the primary place that she Airbnbs. She has two others. I believe that was our mix of Airbnb and longer-term rental. It was a lifestyle choice. A lot of folks are seeing this plus also, I’m sure on your previous episodes talked about Jennifer G and others with asset protection, depreciation, all of that. There are other types of huge benefits as folks to either inheriting other lines of income coming in maybe at the tail end of the career, but ultimately, it’s a factor of time. What’s the level and number? As they say, but it’s not this n number of $2.4 million. It’s what’s the ongoing income that you can be comfortable, especially in a state like Texas or in the Southwest or Southeast, especially as empty nesters.

It can be $100,000, coming in that you can live a comfortable life. We’re seeing more and more folks that are doing that and going full circle with IRA when MRDs, Minimum Required Distributions now when you’re 72 but folks are realizing, “Great. I have a few properties.” That one rent check, we all live off that. I’ll be taking it out and there are no early withdrawals, especially if it’s in a Roth account, you’re not paying taxes. You’re right. You’re seeing more and more of this. You’re going to see more, especially that it’s going to be a great business opportunity for the service providers on the management side. Probably more millennials in our generation are inheriting these properties that don’t want to physically touch them. I don’t know what it’s going to be but there are some pretty cool things coming down the road.

We had an interesting interview with our buddy, Brett Swarts from Capital Gains Tax Solutions, talking about the deferred sales trust. That was eye-opening about how to use that to leverage and especially you’ve got people that are retiring, leaving assets or are wanting to get out of their property and their families may not want to operate and take that over. It’s good stuff they’re definitely out there. What’s the best way for people to reach you? You work with investors from across the country they don’t want to be in this glorious Lone Star State, correct?

Yes. We’re open to anybody with a US Tax account that Rocket Dollar can work with. From the real estate side, I’m fortunate to know many folks even as a friendly introduction. If somebody wants to learn more about multifamily or storage, I can provide introductions so you can do your diligence from there. We’ll do it easy in terms of how to get in touch with me. It’s Dan@RocketDollar.com. My last name is a little complicated but for my Philly fans a whopping $100. If you can spell my name, you got it. D. Kryzanowski. If it makes sense for you to sign up for a Rocket Dollar account. That’ll get you $100 off. For folks that are raising money even if it’s your first go, it doesn’t cost you anything it’s called the copy-paste marketing it is that. You get to by default you get more money from less people faster. Folks on the other side of the coin raising money, I’m more than happy to have the conversation.

That’s awesome, Dan. I appreciate it. You guys are doing a great job. You’ve got the podcast as well. Do you want to talk about the podcast as well?

This is cool. It’s called Rocket Your Dollar. It was fun when we were thinking today, so this thing the most PC to bring out there. Coincidentally, we hosted a Capital Factory. I call it The Bunker because it’s on the military floor. When you talk about this puppy, it’s soundproof. It’s pretty wild. Don’t drink too much coffee or cold brew before coming on but it’s fantastic. You mentioned Brett. We didn’t even talk about this before. Brett’s been on as a guest and some other folks. It has been for the dynamic education for this holistic view that if somebody even cherry-picked what five episodes they want to listen to? My ride home over the next month. We’re trying to do similar.

That’s cool. There’s a variety. It’s been up. We probably do a weekly episode from here we’ll meet a lot of cool folks during South by Southwest. I’ve been doing these one-minute clips the minute with Dan. I probably did about 50 of them too. I’m sure we can. I call them The Bigger Pockets Community. Jake and Gino, Michael Blank, Lis Phair all the guys and gals and even somebody like Jeremy Roll. We talked about the investors. If you are sitting on let’s say $1 million and I know that may be far out for folks, but for those that are sitting in our area now’s the time to take a moment and think, “If I passively invested this wisely and whereas in a relatively lower cost area, can I live off this?” Frankly, it might be yes. That’s another thing. Jeremy Roll, these are the types of folks that either have been on it will be on similar to your great resume of guest over the years.

I’ve been mentioned to it. Check it out, Rocket Your Dollar podcast. There is great stuff on there. Do you have some big plans for South by Southwest? It’s going to be here.

NCS 570 | Retirement Money

Retirement Money: On the real estate end, you’ll be very lucky if you can know so many folks.

 

It’s coming. It’s wild. It’s funny, too. It’s my wife’s and my son’s birthday on St. Patrick’s Day so it’s always eventful one way or the other. In between, it’s everything with Capital Factories booming FinTech luminaries for FinTech friends out there. It tends to be the best show and you’ll see a little more CRE tech. The major CRE, commercial real estate tech, is probably coming late April I believe in downtown Austin. There’s always something going on here.

Thanks so much for coming out and being on the No Closer Show podcast. Thanks for delivering your knowledge as always. Once again, go to RocketDollar.com. Go check it out. Dan@RocketDollar.com. If you can spell his name, he’ll throw in $100 in your account when you open it up there. Reduced fees and they’ve got some great opportunities out there for you to take a look if you’re going to put your dollar to work on something so go check it out. More importantly, take action. You can put up to $6,000 away into your own self-directed IRA, whether it’s Roth or traditional. There’s a lot of opportunities if you’re self-employed into putting your Solo 401(k) or a variety of things out there as well. Go out take some action and we’ll see you all the top everybody.

Good stuff. Thanks.

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About Dan Krysanowski

NCS 570 | Retirement MoneyDan Kryzanowski is an active real estate investor and fundraiser, leveraging Checkbook Control Self- Directed accounts – SDIRA and Solo 401(k) – to create a diversified real estate portfolio yielding double-digit returns. He specializes in self-storage investments, multi-family and hard money residential property loans. Dan has personally raised millions of dollars from family offices and individuals, and empowered his partners to raise seven-figures on multiple occasions.


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