**Disclaimer: I am not a financial adviser. I am not your financial advisor. This is Not Financial Advice (NFA). This is my personal experience as a strength and conditioning coach that I am sharing with you so you can Do Your Own Research (DYOR).**

Now that we got that out of the way, lets talk about finances. This is something that we have been talking about at Strength Coach Network for YEARS. At the 2024 NSCA Coaches Conference I listened to Bob Alejo and Jeff Dillman talk to me about how S&C coaches need to take finances more seriously. We even included a modules on financial robustness inside SCN course The Fundamentals. Why do we at SCN talk about this and why now? Well at the time of writing this the Fed just lowered interest rates so most of the world in Sept 2024 is talking about finances, and because all professions need to do so. And if you see the video at the top of this blog we spoke with Greg Herlean from Horizon Trust way earlier in 2024 - we spoke with over a dozen people on the topic of finances early in 2024 too.

Regardless of the field you work in you should understand where you spend your money and how your money can work for you. This does not mean you worship your money. Rather, you learn how money works. Chances are many of you have read the book Rich Dad Poor Dad from Robert Kiyosaki and Sharon Lechte.



The reason I assume you know about this book is when I talk about finances to a S&C coach they bring this book up. In this book it is where the concept of letting your money work for you is introduced. In this blog I want to show you how you can let a big chunk of money work for you.

What is Self Directed IRA?

Remember NFA, just a S&C coach explaining things based on what I have learned. Let's start with what is an IRA? Individual Retirement Account. These can be pre-tax or post-tax. An example of a pre-tax account would be a traditional IRA where you put in dollars that have NOT been taxed to the account. This means when you take the money out of this account you pay taxes. On the flip side, with a Roth IRA you pay taxes on the dollars before the money goes into the account. Then when you take the money out of the account you do NOT pay taxes. There are pro's and con's to both, DYOR and talk with your financial advisor about what is best for you.

*Pro Tip: Get a financial advisor who is a fiduciary. Wondering what that means? No problem, according to Consumer Financial Bureau "A fiduciary is someone who manages money or property for someone else. When you're named a fiduciary and accept the role, you must – by law – manage the person's money and property for their benefit, not yours" (1). If you have enrolled and completed Fundamentals 1 you already know a Fiduciary. The gentleman, Alan Giese, who presented the module is one. His company Northstar Financial services are Fiduciaries. I personally took Alan's offer at the end of the module and called them for a consult and now work with them.

Now that you know about traditional vs Roth let's introduce self directed IRA. We needed to introduce the concept of traditional and Roth first because you can self direct both types of accounts. With a self directed IRA the money is held with a custodian (the money isn't in your personal bank account) but you the investor tell the custodian where to put the money, and you are able to invest in other assets that you usually can't with non-self directed (2). So say you are into crypto like myself or fellow S&C coach Brijesh Patel - we talked about crypto on the CMW before and the name of his episode is the Crypto strength coach - you can use self directed IRA to invest in Bitcoin. Or let's say you want to invest in real estate - another topic we talked about on the CMW with my former colleague Amit Vohra - you can also invest in that with self directed IRA.

How to Get a Self Directed IRA

This is going to shock you how easy this part is. All you really need is an old 401k from a previous employer. This is where it is easy for us S&C coaches to take advantage of self directed IRA. S&C coaches are let go from their current all the time when a new head coach comes into town. In about 2 months there will be a handful of S&C coaches in this EXACT situation when NCAA football teams let their head coach go. Then there will be another round of S&C coaches doing the exact same thing in January when the NFL replaces head coaches. Old 401k don't only have to come from a "bad" seperation from a prior employer. Those S&C coaches who get hired by the new head coach - they also have an old 401k. Here is an example:

Let's say that University X lets Head Coach A go in November. Head Coach B comes from University Y and lets all the coaches at University X go. This includes S&C coach A. S&C coach A now has an old 401k from University X that he or she can roll into a self directed IRA. Head Coach B brings S&C coach B from University Y to University X. S&C Coach B has an old 401k from University Y. 

In the above example when Coach B has his or her orientation at University X, he or she will have the ability to roll the old 401k from University Y into the 401k at University X. I personally did this when I left the University of Iowa and was hired at Towson University. I had a 401k with TIAA at Iowa, then at my orientation at Towson I was told I could also choose TIAA for my 401k plan, and could roll my funds over. I did this because I did not know about self directed IRA back in 2018 when I took the Towson job. In hindsight, what would have been best for me is to take the Iowa TIAA 401k and move it into a Horizon Trust Self Directed IRA, and then have my new employee 401k at Towson. This way I am diversified with "risky" assets that I control in the Self Directed, and can have "boring" assets like a target retirement fund in the TIAA at Towson.

Where to Open Self Directed IRAs?

You have heard me say this name before and I have had their founder on the CMW before. Why did I decide to go with this company? I learned about this company from one of my remote personal training clients when he had Greg on his podcast. That podcast conversation lead me to do my own research (because again NFA and DYOR). I learned more about the company, did a CMW with Greg, an eventually met them in person. Kelsea helped me with the move from Towson TIAA into Horizon and way very helpful. Jessika helped me with the paperwork of direction of investment - remember, I am the one who decides where the funds go and the custodian makes sure everything is done the right way. I then met Greg and Claudia at an event and appreciated how helpful they were.

You might be wondering if this was a hard choice for me. Fair question, and yes it was. It took a leap of faith, but I wanted to have control. I did my research and understood how this stuff works. Sure, Horizon Trust wasn't as well known to me like TIAA was, but I did not know what SCN was until Joe told me about it back in 2018 when we were playing William and Mary that week.

Let me tell you a quick story about a time I was moving retirement money from a "more known" company into HT. Long story short this company sent the check to the wrong address three times before they finally sent it to the correct address. Here is the kicker, they sent a piece of mail - to the correct address - telling us the check was on the way from the account being closed. Let that story tell you about companies with bigger names. It does not always mean they are better at providing service. In fact I love the customer service I have with Horizon as I hear back from Kelsea or Jessika within 1-2 business days.

What to Invest with Self Directed IRAs?

NFA so do whatever is best for you based on the assets you want. Do you like gold? Cool, invest in that. Do you like crypto? Cool do that. Contact Horizon and find out what other asset classes you can invest in with them. For me I like to keep it "boring". I have BTC and real estate as my main holdings in Horizon. Why? Because if you look at the historic performance of real estate and BTC they both perform very well in the long term and the charts go up.

You might say to me, well Justin the S&P or Dow has been doing the same. To which I will say you're right. Go into the S&P or Dow, just also do Self Directed. It allows you to diversify. Remember, you will have an old 401k AND a new 401k where you are working. So, have the current employer in the S&P or whatever target retirement date you have. And then use the old 401k to roll into a self directed account.

If you do decide to go the real estate route, you can be part of fix and flips like Amit talked about in his CMW. You need to talk with them at HT on the exact paperwork needed. You can also be part of long term fix and flips of large projects. These are called syndications. I learned about these from the guys at the weekly juice podcast when Savannah Arroyo came on their show. I learned about the weekly juice from Mike Tucker and Jay DeMayo and started adding WJ to my podcast rotation. This epsiode with Savannah hit home as her story was almost the same as mine. So I did research into what she was talking about, and then had a CMW with her as well. Doing this type of real estate investing makes it truly passive. People tell you real estate is passive, but there is nothing passive about the work that people put in on the day to day about rehabbing a property (just listen to Amit's CMW and listen to all the work he did). But, if you want to be apart of the financing of it, it can be passive.

So, to wrap it all up - TONS of you have old 401k from prior employees. Chances are you either didn't know you had it (which means there is money in there that goes up or down, but you cannot add more money to it - cuz it's old account) or it rolled over to your new employer. AGAIN, NFA and DYOR but I think you need to look into Horizon Trust and rolling over your old 401k. If you do, I like real estate investing especially now with the interest rates lowering. BTC might be poised to take off soon. So, research it, see what is best for you and your family (PLEASE talk with your significant other about this). It is an amazing feeling to get finances in order, that way we can focus on our job - which is the best one in athletics.

References:

(1) https://www.consumerfinance.gov/ask-cfpb/what-is-a-fiduciary-en-1769/#:~:text=A%20fiduciary%20is%20someone%20who,for%20their%20benefit%2C%20not%20yours.

(2) https://www.investopedia.com/terms/s/self-directed-ira.asp