This is Part 1 of a 4 Part Series.

If you are investing in Real Estate or plan to, this story and the continuing saga that will evolve over the next month or so is a must read. It’s from someone who is in the trenches, right now, me!

A little background to set the stage.

I had an exchange on one investment property that I need to do in order to keep deferring the tax. With this type of investing (exchanging) you have a certain period of time to identify the investment (a standard 1031 exchange allows 45 days to find replacement property and 180 days to close).

However, my exchange is not a typical 1031 exchange. It is from an insurance payout on a property that was part of an older exchange (yes, I have been doing exchanges for years). This property had a sink hole and due to this, the insurance company no longer wanted to insure the property so they paid me off at the fair market value of the property which at that time was higher then it is today.

I paid off my loan with the proceeds then resold the property “as is” full disclosure to a nice couple who could never have otherwise afforded to live in the community where the property was located. We did the closing in a local attorney’s office, as I wanted no mistakes on the sale of this property. With an insurance payoff like this exchange I am allowed more time to re-invest. My time is up at the end of this year.

If I do not re-invest the dollars of profit and my basis from this insurance exchange, I have to pay tax. Exchanges are tax deferred until you stop doing them. Then you owe the tax that goes back to your basis in the original exchange. In other words I would have to invest more money then I received from this insurance payout.

Sounds complicated? Well it gets worse! Due to the current market conditions it’s not only a matter of finding the right property, but obtaining the financing. Due to the fact that I am not a gazillionaire, financing in today’s climate is quite challenging with lenders not lending and high investor loan rates.

Even if you can get a loan, the sheer number of foreclosures and short sale properties out there is overwhelming not only to lenders (who are backlogged at least two months) but also to us investors.

Not to be undeterred, I decided to see just how things really were in a market I know and understand but have not invested in lately. Besides, I thought I could find the money from other “financial friends” if I have to. With my strategy in place, I took myself real estate shopping to Florida. I know, some people go for the sun, but since Florida is on sale…

Stay tuned to Wise Women Investor through June as I will update the investor section every Friday where I will share one lesson learned from this excursion along with extreme measures we, as investors have to consider in today’s market, no matter where that market is!

Lesson #1

If you thought you can buy property over the Internet with these spiffy web sites that have instant quotes among other bells and whistles, FORGET IT! There is no way you should try to buy anything site unseen. Even if you have a trusted person in an area you wish to invest in trust but verify, get on the plane, the car, the bus and go and see what it is you are buying or stay out of this market!

Don’t forget to check back here next Friday for more on my Real Estate shopping trip in Florida. You can also read the entire story in my newsletter coming out in late June.

In the meantime, I have posted a couple of pictures to illustrate what that market looks like. It was amazing to see one property for rent, next door to one for sale, and next to that one, one that said short sale.

Short Sale, For Sale and For Rent

Snapshot of the Current Market

I recently read an editorial in the Financial Times that I thought would help Wise Women business owners and managers to become a better leader. These points were addressed thanks to President Barack Obama’s first 100 days in office.

Take note: I think all of them have some merit, enjoy!

· Lead with “purposeful energy”.
· Set a consistent tone.
· Aim high.
· Don’t be afraid to work simultaneously on all fronts.
· Listen and show respect to all, especially those who disagree with you.
· Take a global perspective.
· Hire experts but take the decisions yourself.
· Use the power of digital media to communicate directly.
· Learn fast.
· Stay grounded (get a dog).

Contributed by: David Butter in London for The Financial Times

Over and over again I hear from people who have not only lost money in the market, but also in their retirement plans. I recently went to my doctor for a physical. He told me he was planning on retiring this year, but has lost so much money in his retirement plan that he can no longer afford to. He was disappointed, as he had looked forward to spending time between his homes in Hawaii and Lake Tahoe. “Not now”, he said. And, on top of this, business is down because so many people have lost their health insurance that they skip the doctor visits if they have to pay!

Now you might not feel sorry for someone with homes in Lake Tahoe and Hawaii. My point is that everyone, no matter what financial position they have achieved in life is suffering.

We can feel sorry for ourselves or we can do something about it. I make the case for the self-directed IRA because a truly self-directed retirement plan allows you to invest in hard assets as well as conventional investments. You get to vote on your money by making the choice to diversify, to not have all of your assets in one investment or with one broker. A self-directed retirement plan requires your active input. You make the decisions, not someone who will never care as much about your money as you.

The Entrust Group offers a commitment to excellence, integrity, and community. With local offices throughout the U.S. we know that our commitments go far beyond the work we do for our clients everyday. Because we make no investment decisions or recommendations (we simply act on your instructions) the choice of the investment is yours!

Happy Memorial Day to all of you who read Wise Women Investor!

Enjoy the sunshine, the barbecue and the family time on this great May Day!

I was recently interviewed on “Real Estate Hot Talk” a radio show for investors. The segment was for “Women Investors” and was not at all limited to real estate. Many of the questions from women were borne out of a fear of the unknown.

A repetitive issue that came to me even after the show with the numerous emails from women who are uncertain in today’s times, was the issue of the stock market and where to put any extra cash so they can save and not worry about the safety of their money

So I did a little research; read articles, talked to some financial people and bankers. Here is the answer from the group I spoke to:

The safest investments are government securities such as Treasury bills, bonds and notes that are backed by the U.S. government, or bank CD’s with institutions that are FDIC insured with shorter maturities. Neither investment pays a great interest rate but if you are looking for safety then these are the safest investments out there!

Hope this helps those of you who are concerned about where to stash your cash in this market!

Many business owners, professionals and managers have been faced with having to conduct layoffs over the last year and a half, which has affected their stress level and their health.

Since the economy took a nosedive more then 3 million Americans have been laid off. Many of us have been charged with the task of delivering the bad news to these angry employees. Reports of stress linked to being put into this position such as disturbed sleep, stomach upset, chest pains, back and neck issues and depression has affected our daily lives.

Employees may not realize how difficult it is for business owners and managers to be put in the stressful situation of having to let someone go. They know that their employees’ financial life is being put in jeopardy and it’s a difficult position to be in. Those who have no warning that these layoffs are coming and then are stuck in a situation of having to fire people on the spot suffer greatly.

What can any of us do to make a bad situation less stressful? Try to accept that this unfortunate task goes along with the territory and with the job. It is not easy having to fire anyone, especially a good employee with loyalty who is being let go due to financial or other circumstances beyond your control. You just have to pick yourself back up, dust yourself off and continue on. I realize this sounds easier than it is, however, if we allow all of the negativity and sadness to get to us, we will make ourselves sick and be of no use to our business, our family or ourselves.

Please try not to allow your job could affect your health!

I have noticed many “experts” popping up over the Internet with web sites, education and other advertising offering their expertise as custodian, administrators or the source of education for self-directed IRA account holders.

In these turbulent times, and with the many scam artists out and about, I cannot stress the importance of knowing WHO you are doing business with. In the self-directed IRA Industry that means longevity, knowledge of the rules and regulations on how to buy an asset in your IRA or your Individual (k) plan and a place to go that you can count on for the answers to your questions and concerns.

It is my opinion that the buyer, YOU must due your due diligence.

Ask questions!

Find out how long someone has been in this business. (Now more then ever longevity is an issue for you to consider). What is their offer? Are they really an administrator or custodian or are they just selling an expensive product that you don’t need? Do they want to charge you an arm and a leg to do it?

Do they have an educational arm to their company? Better still, do they offer continuing education and accreditation for professionals and investors with their platform?

Are there local offices in your region where you can go and actually check them out? What kind of background does the company have and what is their business model?

Do they have credibility? Study company web sites and print media to make sure you understand what they offer and that they are reputable.

When you are investing your money with your IRA funds you should choose an administrator who does just that administrates or is the custodian for your self-directed IRA account, not recommends products or provides you with recommendations of anyone who could recommend an investment to you. They need to be an objective third party.

Be careful of associations or businesses that give the impression that they are a “regulatory body” (far from it) and web sites representing product. A regulatory body is generally just that; a body that is regulated by a city, state or federal government.

Unfortunately I feel it necessary to have to write this post today as a result of abuse in the self-directed industry and the negative blogs from those who profess they have the answers! They are not in the IRA custodian or administration business, they are in the business of trashing others so they can get ahead.

Whether it be a self-directed administrator or custodian, be aware of these types of companies or associations who tell you they are the only answer because they are not!

I am speaking from experience of people who have gotten burned. Buyer beware!

BUYING BARGAINS IN TODAY’S MARKET
Generating Cash Flow Today and in the Future

Three Day MEGA workshop event in San Francisco, CA
May 29-31

Jack Miller, Peter Fortunato, & John Schaub – ALL TOGETHER
will be on stage and teaching the class for the first time since 2001.

Old Time investors, exchangers, and wheeler dealers – they have been investing in Real Estate for well over 40 years and have gone through many up and down cycles over
that time. Their real world educational workshops taught over the years
are the standard of excellence by which others should be judged.

Many who have taken their advice and followed their teachings have gone
on to become extremely successful investors. So many in fact that
their past students have dubbed them; “The Millionaire Makers”.

BUT THEY DON’T JUST TEACH. Each of them are in the trenches every day
generating tremendous profits because they have adapted their buying and
selling strategies to this evolving market. Real time strategies and
techniques they will share with you in San Francisco.

Visit http://bawb.info/cashflow for more information.

Lisa will be there! How about you?

With all of the news of people doing Ponzi schemes I thought I would devote today’s blog to the history of a Ponzi, and his scheme so the next time you read about someone doing a Ponzi scheme you will know what the media is talking about.

A Ponzi scheme is an illegal investment named after Charles Ponzi, an Italian immigrant who settled in Boston and duped thousands in a postage stamp speculation investment in the 1920’s.

According to the Securities Exchange Commission (SEC), Ponzi made large profits by taking advantage of fluctuations in differences between U.S. and foreign currencies used to buy and sell international mail stamps.

He raised millions of dollars from people after claiming he could produce a 40% investment return within 90 days. It was far more then the 5% interest banks were offering at that time for savings accounts.

As the money rolled in, Ponzi used the new dollars to pay existing investors. It is reported he took in an estimated $15 million. The investment dried up when the government stopped paying for surrendered stamps shortly after Ponzi began his infamous scheme. He never paid more then a fraction of the expected return. With no money, the scam collapsed.

What is the message here, if it is too good to be true…hold onto your wallet!!!

Thanks Mom for all you do. To all of you wise women and mothers out there, celebrate the day!

Enjoy your loved ones and be thankful!