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At Wealth Apex, we help investors use 20% of their portfolios, to make the other 80% work more effectively. After you create your login, you’ll fill out a quick survey. Then, one of our wealth strategists will analyze your balance sheet, and we will present recommendations.
Here’s An Example of a Strategy We Use For Some of Our Investors
The Wealth Apex Capital Warehouse strategy implements a proven yet little-known Dual Compounding system. It’s the closest you’ll ever get to investing one dollar twice. The Capital Warehouse strategy is especially useful to real estate investors, entrepreneurs and business owners who struggle to invest for retirement while simultaneously maintaining the liquid capital they need for other purposes. A Capital Warehouse is an investment account in an A-rated financial institution. While past returns are no guarantee for the future, it’s always helpful to learn from history. The average annual return of these accounts over the past 20 years was over 7%, but we will assume an average annual return of only 6% to be conservative. It achieves its returns by going up whenever the stock market goes up, capping out at 12.5% per year. Yet it never loses money due to market crashes. (No, it’s not an annuity.) At the same time, your Capital Warehouse can be used as collateral to borrow up to 85% of the money in the account at low 3% interest rates (please note that interest rates may vary.) This mechanism is what allows you to invest the same dollar twice.
Here’s How It Works
Step 1: Set up and properly structure your Capital Warehouse. This is a highly specialized process best implemented by an experienced professional. Step 2: Initiate the dual compounding component of the Capital Warehouse Plan. Once your funds are in your Capital Warehouse, you can access them at any time. However, unlike your bank, the Capital Warehouse allows you to actually earn two different returns on the exact same dollar. When you have an investment you would like to make, you simply use your Capital Warehouse as collateral to borrow up to 85% of the money in the account. The money you borrow is then placed in the investment of your choice. Your Capital Warehouse is fully-funded, and can be expected to regularly increase in value. As we mentioned above, the historical average annual return for Capital Warehouse accounts is 7%. Meanwhile, an additional sum equivalent to 85% of the value of the Capital Warehouse is invested in the investments of your choice. You are now effectively earning two returns on the same dollar. To meet the tax code requirements of this plan, it’s important to access your funds in the proper way. At Wealth Apex we can show you exactly how to do this. You can use the funds in your warehouse to invest in anything you wish. You may choose to invest in income producing real estate, equities, precious metals, oil & gas, etc. You can also use the funds to grow your business by investing in business expansion, equipment, acquisitions, hiring new employees, etc.
Case Study: Comparing the Capital Warehouse to Direct Investing
Let’s consider a hypothetical case study to see how it works. Suppose that you want to invest $1,000,000 in a real estate investment that you expect to gain 10% annually. The traditional way of investing would be to simply invest $1,000,000 straight into real estate. Instead, you first place $1,000,000 in your Capital Warehouse. It earns an average 6% annually (that’s a conservative estimate based on past results). Then you borrow 85% of the value of your Capital Warehouse account, or $850,000, at a 3% interest rate. You invest $850,000 in the real estate investment. Meanwhile, your money is still earning an average of 6% annually in the Capital Warehouse. Under the traditional strategy, your return is 10% or $100,000 in the first year. Under the Capital Warehouse strategy, you have returns of $60,000 from the Capital Warehouse and $85,000 from real estate. You also have a borrowing cost of $25,500. So your total return is $60,000 + $85,000 – $25,500, or $119,500. That’s almost twenty percent more than you would have earned by investing your money directly in real estate. But that’s just the beginning. The returns from your Capital Warehouse are 100% tax-free, which means that slightly more than 50% of your returns are completely tax protected. Let’s consider the impact of a 20% higher return over time, even before factoring the tax advantages of the Capital Warehouse Strategy:
|Year||Direct Investment||Capital Warehouse Strategy|
Remember! The Capital Warehouse strategy protects a continually growing percentage of your portfolio from taxes, whereas direct investment in your business or real estate typically does not. So the Capital Warehouse strategy has the potential to yet further outperform the direct investment of your funds. Another benefit of the Capital Warehouse is that it works for you year in and year out. Investments in real estate and business often involve years where your money is simply sitting on the side. With a Capital Warehouse, your funds are accessible at any time with no fees, penalties, or taxes should you make a withdrawal. It is protected from creditors, lawsuits, and bankruptcies in most states, and it’s completely private and non-reportable (in states which do not protect the Capital Warehouse from creditors, lawsuits, and bankruptcies, there are often other structuring options available to protect your funds. This is something we specialize in at Wealth Apex). Your funds can never decrease in value due to market downturns, and the money passes on to your heirs 100% tax-free (unless your estate surpasses exemption). You might even say it’s the perfect retirement plan.
Benefits For Real Estate Investors, Business Owners, and Entrepreneurs
Real estate investors, business owners, and entrepreneurs require liquid cash available to meet their regular needs. This forces many individuals to forgo setting aside large sums of capital for retirement. They fear that they will not be able to access their funds without penalty. With a Capital Warehouse in place, you need not sacrifice your retirement to keep your business or investing activities afloat. You can simply park your money in the Capital Warehouse, borrow 85% of the value of the money in the Capital Warehouse, and use those funds to meet your liquid cash needs.
The Next Step
If you’d like to learn more about the Capital Warehouse strategy, give us a call at 1(800) 841-9917 or click here to schedule a time to talk with us. We’ll tell you more about how it works, and if you’re interested, we can discuss the possibility of setting one up for you. At Wealth Apex, we think it’s important that our clients have as much freedom and flexibility as possible. The Capital Warehouse gives you the freedom to put away money for retirement, increase your overall returns, and still invest in your business or in real estate. Be in touch! Wealth Apex 1(800) 841-9917 [email protected]