Insider Secrets Podcast Episode #14
Featuring Guest: Chris O’Connor
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Chris started investing at the ripe old age of 16, when he bought $1000 of the T Rowe Price New Horizons Fund with money he saved from lawn mowing, snow shoveling and odd jobs. With the seed capital from his mutual fund, he started a business in 1979 at 22 years old by purchasing a retail franchise store. He was extremely interested in commodity trading and started trading in 1982. In 1986 he acquired a seat on the Minneapolis Grain Exchange and traded in the pits.
He secured his securities and insurance licenses in 1987 and opened his own firm in 1990. He grew the firm from 2 people to 65 representatives in 5 offices over 18 months. He became a real estate broker in 1993 and has bought numerous properties.
When he sold his businesses in 2008 and retired, he says he became bored, and now he focuses on the part of planning that he enjoyed the most, estate planning. Chris has tremendous depth of knowledge in creative estate planning and showing his clients how they can get huge tax deductions, and avoid capital gains tax upon the outright sale of a property.
[00:00:00] Mike: Hey everybody. It’s Mike with Insider Secrets and welcome to another Tuesday afternoon episode. Hey, I am joined today by Chris O’Connor from Mumford Financial. Chris, can you tell what they’re going to hear today a little bit about?
[00:00:25] Chris: We’re going to talk about your favorite topic, the Exit Plan, what to do for estate planning and how to save taxes, and make sure that your estate is passed onto your errors and do what you want your money to do.
[00:00:39] Mike: Excellent. And you’ll have to listen in to hear the rest of today’s interview.
[00:00:44] Kristen: Welcome to this week’s edition of Insider Secrets. The show that turns multifamily investing into reality. Each show we interview guests who are seasoned professionals, actively closing and managing real estate deals. Your host [00:01:00] Mike Morawski has more than 30 years of multifamily, real estate investing and property management experience.
[00:01:06] Mike is the founder of My Core Intentions. And he’s been involved in over $285 million of transactions. Focuses on helping you create short term cashflow and long-term wealth. Here’s your host, Mike.
[00:01:22] Mike: Hey, good afternoon, everybody. It’s Mike, your host of Insider Secrets and Insider Secrets is brought to you by My Core Intentions. What have you been thinking about your intentions lately? How about what really matters in life and in business. You know at MCI we invest in our client’s future through an educational platform, teaching you how to create short-term cashflow and long-term wealth. While empowering you to execute sound real estate investing principles while living a balanced lifestyle.
[00:01:52] More and more I’ve noticed lately that to live a balanced lifestyle, it takes a little bit of work. There’s a grind involved [00:02:00] with it, right? Because we get so distracted, we let other things pull us into millions of other directions. But if we can develop strong, foundational, practical principles to live our life by, it just helps things go smoother.
[00:02:14] I share a lot of these principles in my newly released book, “Exit Plan”, your complete guide to multifamily investing and why you need an exit plan before you buy. You can pick your copy up today on our website @mycoreintentions.com or at Amazon. Alright, enough of that sales stuff, right?
[00:02:32] Hey, if you are looking for some direction, give My Core Intentions a call today and see if we can help you. I am really excited about today’s show. I am joined by my friend and entrepreneur guest, Chris O’Connor. Chris is an entrepreneur and an investment strategist. Chris, would you say hi to everybody?
[00:02:52] Chris: Hi, How’s it going out there?
[00:02:55] Mike: Doing great. Thanks for being here. Hey, listen, it looks like you’re calling from Maui and I know you’re [00:03:00] not, but I wish you were because I would have had to come in there and do the show that’s for sure. Hey, Chris started in his investing career at a ripe old age of 16. And when he bought a thousand dollars of T. Rowe Price, new horizons fund with his money, he saved from mowing lawns and shoveling snow, just doing odd jobs.
[00:03:22] Those are the things I try to get my son to be doing more of right. With the seed capital from his mutual fund, he started a business in 1979 at 22 years old and purchased a retail franchise store. Now, if anybody’s calculating the math right now, we’re all figuring out Chris is about 70. No, about 60, 62 years old.
[00:03:43] Chris: No, your math is terrible Mike, I’ll be 64 this month.
[00:03:48] Mike: That’s why I have you on though, because an expert like you can help with math. He was extremely interested in commodity trading and started trading in 1982. In 1986, he [00:04:00] acquired a seat in the Minneapolis green exchange and traded in the Pits.
[00:04:05] He secured his securities and insurance license in 87 and opened his own firm in 1990. He grew it from two people to 65 representatives in five offices over 18 months. He became a real estate broker in 1993 and he’s bought numerous properties along the way. Chris, we’re going to be able to share some great things today about investing about entrepreneurship and about real estate.
[00:04:32] And I look forward to getting into all of this with you. One thing that I always ask my guests when I have them on is in one word, can you describe what your personal investment business strategy is?
[00:04:46] Chris: I would say that the biggest issue is to, and it’s not one word, but manage risk. No matter what you invest in, whether it’s multifamily properties or stocks, bonds, [00:05:00] commodities. Managing risk is always important and risk comes in a lot of different ways so. We can get into that in a little bit.
[00:05:08] Mike: Yeah. Interesting. I’m glad that you said that, cause I know that’s something that you’re real good at and it’s because you have a tendency to think things through. I read through your bio a little bit and talked about some highlights, but why don’t you tell us your backstory and how you got involved in the trading business and the real estate business and how you ended up where you’re at today?
[00:05:30] Chris: It’s an interesting story. My family goes back three generations ago, my great grandfather started a company which is now a fortune 100 company. And like many entrepreneurial families, the wealth creation is driven by that entrepreneur and many of you out there that are doing those things to build wealth are the first generation. Unfortunately, the department of labor says usually after the third generation that an entrepreneur builds [00:06:00] wealth, it’s gone, and in my case that’s exactly what happened.
[00:06:05] If I didn’t have my own businesses, the family wealth would be gone. And it’s almost like the Vanderbilts and Rothschilds. I don’t know if you’re familiar with that story. But the Vanderbilts, Cornelius Vanderbilt basically gave away what today is the equivalent of a billion dollars or several billion dollars to his children and his children’s children.
[00:06:29] When they had a reunion in 1972 of the remaining family from Cornelius’s legacy, not were millionaires, none of them. Conversely the Rothschilds set up programs to teach the kids and the multiple generations to come, how to manage their money and how to be good stewards of their wealth.
[00:06:51] And so the Rotschilds today have multiple billions of dollars still while the Vanderbilts have nothing. Unfortunately, [00:07:00] my great grandfather and my grandparents follow that the Vanderbilt model, which was not a great thing. So my whole goal in finance and building a state just to make sure that you do. You know what you’re working for so hard to build that wealth is for multiple generations. And not just the money, but the ability to show your heirs, your children, your grandchildren, and multiple generations that come how to properly manage money. Because you’ve all heard about the trust fund babies who are lazy, don’t do anything, and basically pardon my French, will piss the money away.
[00:07:39] And so my job is to teach my kids and my grandkids and multiple generations to come, how to properly manage and be a good steward of those dollars.
[00:07:51] Mike: Yeah, very interesting. Chris, I liked the entrepreneurial mindset that you have, and I’ve always liked that about you. You really know how to [00:08:00] plan and strategically put things into place and you know that your backstory from where it comes from three generations ago, I don’t believe that entrepreneurial traits just happen to people.
[00:08:12] I think that they are built. When I think back in my own family, My dad’s dad had his own business. And it wasn’t a big major fortune 100 company, but it was an entrepreneurial business. And what’s really interesting is, I’m having a conversation these days with my son, who’s talking about wanting to go into his own business, not real sure on what he wants to do, but he’s really has this entrepreneurial attitude.
[00:08:38] And it was funny, we had a great conversation over the weekend about that and what type of benefits there could be. And I said, Hey, look at the family you come from. I said, your mom and your dad both run their own businesses, they’re both entrepreneurs. And that’s where it comes from.
[00:08:54] Chris: Yeah.
[00:08:54] Mike: I said, legacy generation stuff that’s passed down. I never knew that story about the [00:09:00] Vanderbilts and Rothschilds though. That’s interesting. So let’s start with some basics, Chris. I know that we’re going to talk about investing and planning in that, but why does anybody need a state planning in their life?
[00:09:14] Chris: Because of my story, I’ve seen a lot of wealth go away because of improper estate planning. But if you look at the facts that most people just have a will. This was one thing, a will guarantees that the assets that you own go through probate because simply a will is instructions to the probate court.
[00:09:32] A lot of people don’t realize that. So typically across the United States, probate costs because of the fees involved and typically having an attorney involved somewhere between three and 8% of the total assets that a person has. Now, that’s not the only thing that’s wrong with the probate.
[00:09:51] The other issue is that the settlement time on average, it takes about 18 months. So it can be a real hassle. Even with proper [00:10:00] planning, I know of a client who refuse to do the planning that we suggested and his estate took over five years to settle. Now, what does that do to the heirs? Gives them a bad taste and it’s something that can be done relatively inexpensively.
[00:10:18] And so you don’t have these problems. So not only is it costly, the settlement time is a very long typically and it’s just a hassle. So those are some of the reasons that you want to do some more advanced planning that just have a will. And it’s estimated that 80% of people have either a will or nothing.
[00:10:39] Now, if you have nothing then the state decides who gets your assets, and that can be pretty bad. Because let’s say you have a son that passed away and his wife and your grandkids now will get nothing. So depending on what state you live, so proper estate planning is really important.
[00:10:58] Mike: Yeah. Interesting. [00:11:00] So let’s shift gears a little bit and talk about the real estate owner who owns multiple properties. How does that work into a good plan or what type of planning is needed around real property?
[00:11:13] Chris: There’s we could talk for hours on this, but to boil it down is if you’re smart, you’ll typically have, and most people do either have a corporation or an LLC for your properties.
[00:11:24] And if you do it correctly, you should probably have an LLC for each of your properties. Because as we know, tenants can do weird things. So let’s say for example, you have five properties and they’re all in one LLC. If your tenants slips and falls, and for some reason you forget to pay your insurance or whatever reason you get a judgment against you on that property and that LLC, now all five properties are subject to being attached. So that’s not a good thing.
[00:11:54] So what our recommendation is to make sure that you have an entity for each [00:12:00] particular property that you have .Now from an estate planning standpoint, one thing that’s extremely important is you want to make sure that you don’t co-mingle those funds.
[00:12:11] As an example, if you do a trust or a revocable living trust, or even an irrevocable trust or estate planning, you don’t want to take those assets from your LLC and just put the title in your trust because that’s co-mingling of assets, and that can cause some really bad problems. Tax and regulatory problems are not fun.
[00:12:31] So you need the proper tools to do it ethically. As an example, corporations have bylaws, LLC has have operating agreements. And so you have to make sure that those are also done every year properly and you do proper corporate and LLC recordings, because if you don’t, it can be a world of hurt for you.
[00:12:53] So those are some of the things that are very important when you do estate planning in regards to multiple [00:13:00] properties.
[00:13:01] Mike: So it seems like you have a lot of knowledge and a lot of experience around state planning, around making smart choices around your investments and that. Where does your passion lie in that? Why are you so passionate as you are about all that?
[00:13:16] Chris: I think primarily it comes from family need. 1987, my dad stock and it was a forced buyout. It was a leveraged buyout actually. And so he was concerned at that time, the capital gains tax was I think 30, 35%. And his cost basis was zero because his grandfather gave him the stock.
[00:13:37] So we had to look at ways to reduce the taxation. And so effectively what we did was we revocable capital repositioning trust that did several things. It removed those assets from his estate. It had allowed him to sell that stock and you can do the same thing with a property similar to a 10 31 [00:14:00] exchange, except there’s a whole lot of more benefits.
[00:14:03] He sold the stock, paid no capital gains.He got a huge tax deduction that he used, some of it the first year and carried it forward five more years. And ultimately what we did was we increased his cashflow by about a hundred percent. And so using other techniques combined with it, we increased the size of his estate by about two and a half times.
[00:14:26] So by doing these things, you can see how you can even use a multiplier effect to make sure that you’re not going to get whacked by estate taxes and capital gains taxes, and really make sure that you come out on the right end of the stick.
[00:14:44] Mike: Interesting. I’m sure that over the years you’ve been faced with some pretty tough decisions that you’ve had to make. Maybe personally about some of your planning, but maybe help clients walk through some personal tough decisions. How do you make high [00:15:00] stakes decisions when it comes to family finances and leaving a legacy and business and things like that.
[00:15:08] Chris: I’ll tell you a story, which is really sad. It was a guy, his name was Norve, and he lived here in the twin cities. And I met with him, I think around the 1st of October, we did some planning versus state. He owned five multiple units, I think they’re apartment units and they were 10 doors in each unit .And long story short, he had about a $10 million state.
[00:15:33] The problem at the time was this was back in the nineties. It happened to him his wife didn’t have enough assets or enough cash to be able to keep those properties. So what we did was we provided him an irrevocable trust plus to some leverage with some life insurance, and that would have taken care of the problem.
[00:15:55] Here’s the rub. He put me off. He put me off, he put me off. [00:16:00] Finally, I called the day after Thanksgiving and his wife answered and she said Norve died. And unfortunately, because he died, he left her with a huge mess. They had to liquidate the properties, all the properties to pay as a state tax, because remember the state tax is due nine months after the death of the owner.
[00:16:26] And I didn’t do a fire sale. She got probably 70 cents on the dollar decimating to her to have to deal with that. So I guess the moral of the story is don’t procrastinate. If you have assets and you want to make sure that you’re taking care of your money and being a good steward, do it now, because there’s never time.
[00:16:49] Mike: When you say do it now, it wouldn’t really matter if somebody was 30 years older, if somebody was 60 years old. The sooner is better, but get it done.
[00:17:00] Chris: Yeah. And nobody knows when they’re going to go. Darlene, my spouse, she lost a child at three months old, and then my dad lived till he’s 93, so you never know. But it’s always a good time to plan when it’s at the top of your mind, because it’s one of those things where you forget about it and it goes away and you don’t ever think about it again until something happens. And sometimes it’s too late. And it’s funny because people pay for homeowners insurance and their apartment insurance and so forth, a thousand, $2,000 a year, $3,000 a year for 30, 40 years. And they don’t think anything of it. What’s the statistical probability that your home is going to burn down? It’s about one in 18,000. What’s the statistical probability that you’re going to die? It’s about a hundred percent. So why wouldn’t you take the time to cover those statistical probabilities that you know are going to happen? And it’s just common sense.
[00:17:56] Mike: Yeah. There’s no way out, we’re all going to die.
[00:18:00] Chris: Unless we’re like you Mike, and you’re immortal.
[00:18:02] Mike: Hey, you know what? Somebody’s got to be.
[00:18:04] So listen, from a standpoint of a multi-family operator, we have a lot of people on the call that are new real estate investors, small multifamily operators, large syndicators. What do they need to be aware of? How does a state planning and just proper planning play into what they’re doing in the real estate business?
[00:18:28] Chris: Yeah. And it ties back to, and I hate to take a shameless plug, but it ties back to your exit plan.
[00:18:36] Mike: Yeah, thank you.
[00:18:38] Chris: I’m talking to you, Mike, because you and I both agree. And even before you wrote your book, we talked about having an exit plan, having the end in mind first. So what is the end?
[00:18:49] We all want to make money and have a great lifestyle and be good stewards of our money and so forth. But what is it that you really want to be known for? What is it that you want your legacy to be? So [00:19:00] a lot of times people grapple with that and they don’t really understand what that should look like, and it really is boiling down to take some time.
[00:19:08] If you have kids, what do you want your kids to learn from your hard work? So just like you said, Mike, your son is interested. What do you want them to learn? And so by identifying those things, you can get some clarity of what you really want to accomplish. Now, once you’ve done that, now the problem is how do you deal with it?
[00:19:31] What I say is you can always go to an attorney. But the problem with an attorney and any attorneys listening, I’m sorry, but this is the way it is. There’s always a conflict of interest. Now I’ll give you an example. So if you have a will that’s done by an attorney that will guarantees probate. And let’s say you have a $2 million estate just say that’s what your total estate is.
[00:19:56] Your heirs could conceivably pay somewhere between 60,000 and [00:20:00] 180,000 or $160,000, just a ton of money to have that estate probate. That’s a big incentive for an attorney just to do a will, so they get the probate on the backend. And the problem is that it can be done for $2,000 or $3,000 to take care of everything that you want to do and not have to be subject to those huge estate probate costs.
[00:20:24] The other thing that’s interesting is the American bar association itself said, that less than 1% of all attorneys have the ability to craft a competent estate plan. So think of it this way.
[00:20:37] Mike: Wow.
[00:20:38] Chris: What do you call an attorney that graduates from college with his JD? An attorney, right? What do you call a doctor that graduates with his MD?
[00:20:48] Mike: A doctor.
[00:20:49] Chris: So does that make the doctor a brain surgeon?
[00:20:55] Mike: No.
[00:20:56] Chris: And if you have a problem with your foot, would you go to the heart doctor? [00:21:00] No, vice versa. You’d go to the specialist that spent years doing that. And that’s what we do is we look at the attorneys that have at least 50% of their time is spent on the estate planning and make sure that it’s done correctly.
[00:21:13] So we work with a highly vetted network of expert estate planning attorneys do really an exemplary job. And the other thing is that we provide services during a life event. So in capacity, as we get older, Mike, that we talk about our aches and pains, and we’re not doing the video. So when somebody’s thing happened, like an in capacity, our company steps in and helps those that are left behind in time of that emotional turmoil. So it’s a little bit different than just going to the attorney and drafting a document.
[00:21:46] Mike: Yeah.
[00:21:46] Chris: It’s really more of a full service type of thing.
[00:21:49] Mike: You bring up a good point Chris? So I’m on the multifamily side. If I’m going to walk in and talk to somebody about estate planning, what questions would I want to [00:22:00] ask? Or should I ask to know that I’m going to be served in the best manner, the best way possible?
[00:22:07] Chris: If you want, I can certainly send out the 21 questions to ask an attorney to you. And we can get that to you if you’d like to have that. You can just either call or send Mike a message and we’ll get that to you. I can send you Mike, and you can post that if you want.
[00:22:25] Mike: Yeah. You know what? I would love to see a copy of it for myself, but any of the listeners, we’ll make sure that your information is provided at the end so that they can call you or go to your website and get that. So can you just maybe mention a couple things off the list real quick?
[00:22:41] Chris: Sure. One of the things is that you want to make sure that what’s the service after the document? And that’s probably the most important. Give you an example, let’s say you do in a revocable what’s called a living trust.
[00:22:56] Lot of attorneys do that. It’s a very common document [00:23:00] and it does avoid probate and it’s completely private. That’s another thing about probate, it’s completely public information. So a living trust is private, but once that human is done, what happens after that? Somewhere between 70-90% of all living trusts are what’s called funded in property.
[00:23:18] In other words, I’ve talked to people that have a living trust, yet their home and their investment properties are not in the trust. So that becomes a real problem because now you have a document it’s like having a safe and putting all your valuables outside the safe and leaving them outside the safe. It doesn’t do anything for you. So what happens after the documents are done? That’s a huge thing upfront to ask an attorney.
[00:23:46] Mike: Interesting. Over the years, I’m sure you’ve learned some valuable lessons, but what is one of those lessons today that you wish you would’ve known early on or known earlier?
[00:23:58] Chris: I think that [00:24:00] it’s funny because at almost 64, I’m pretty lucky I don’t have much gray. And when I started in the business at 28 years old, I was really concerned that I didn’t have any gray hair and everybody would think that I was just a kid. So what I did learn is that gray hair doesn’t equate smarts.
[00:24:19] In other words, I think you always have to rely on continual improvement of yourself and learning no matter what your age and that’s why I know both you and I do a ton of reading and research, and you’re always trying to keep up with all the newest laws that are going on. The time that I’m going to quit learning is a time they throw dirt on top of me.
[00:24:40] Mike: Okay. Yeah, education is really important and I’m an advocate and that’s one of the things that we do at our company is we teach people different strategies, different techniques and things. I heard an interesting comment the other day, I was listening to Jim Roan YouTube video and Jim said, learn, [00:25:00] execute, and teach.
[00:25:02] And I love the teach part of that, because if we don’t give it away, just like you’re doing now with giving information away, you don’t make room to take more in and that’s how we learn. We have to get rid of it. So I think that’s interesting. This show is called Insider Secrets, right?
[00:25:17] I know you’ve had some experience in the multifamily arena. You’ve had some entrepreneurial experience. You’ve had estate planning experience. What is a secret that you’d give to an multi-family operator today? What would you consider an insider secret?
[00:25:35] Chris: I think right now it’s strange time. But I think because of COVID because of all the bailout packages and so forth, the federal debt is the top of mind to me. And so things that concerns me is with a $27 trillion service debt. By the way, if you counted [00:26:00] and every second one or the 179, 10, if you counted every second up to 10 and you counted to 27 trillion. Do you know how long that would take you? If you did it 24 hours a day? It would take 86,000 years. That’s how big that number is.
[00:26:16] Mike: 86,000 years. Geez.
[00:26:19] Chris: You can do the math. I’ve done the math and so the problem becomes how are we going to service the debt on that service? The interest on that debt? And at some point in the future, the United States may not be able to pay the interest on that debt. So two things can happen. One is that they can cut spending, cut entitlement programs and you can raise taxes. Which do you think they’re going to do?
[00:26:47] Mike: Oh, they’re going to raise taxes of course.
[00:26:49] Chris: So this is the problem that I see, and this is why it’s so important again, with the exit in mind. Because if you a large [00:27:00] property that you’ve depreciated over the years and all of a sudden you’re facing a bunch of recapture, what are you going to do when the taxes are super high? Here’s a question for you, Mike, what was the highest US marginal tax rate in the US history?
[00:27:16]94%. Now, of course, that was after the war, but interesting that even in the late sixties and early seventies, the highest marginal tax rate was 70%. So if people think all the taxes are never going to go up again, that’s my biggest takeaway. There was a judge who was the US circuit court judge.
[00:27:40] And he said, and I’m going to read this because I haven’t memorized it, but it’s so important. I want to read it. Over and over again, courts have said that there is nothing sinister and so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, richer, poor, and all do right for [00:28:00] no owns any public duty to pay more than the law demands. Taxes are enforced exactions, not voluntary contributions to demand more in the name of morals is mere Kant. Now he wrote that in 1940. So it still holds true today. Start with your exit in mind, have an exit plan that takes not only all your sales and everything, but taxes is a huge issue, especially if you have qualified money like 401k money, IRA money that you’ve purchased properties with. Very important, because today we’re at historically low tax rates, it might be time to roll out and do a Roth conversion because taxes are going to go up.
[00:28:50] Mike: And would you advise somebody to do that type of a Roth conversion and it may be a self-directed type of IRA product?
[00:28:57] Chris: Yeah, certainly can. Obviously if you have properties in it, [00:29:00] you already have a self-directed custodian, it’s just a matter of making sure that you do it quickly then by year’s end would be great. So you can take advantage in the next few years, because if taxes do go up, then you have a row. You never have to worry about paying taxes again.
[00:29:16] Mike: [00:29:16] So what pitfalls should investors look out for in today’s market? Here we are sitting close to the end of the year during the COVID pandemic. Hopefully everybody’s hoping that this is going to be over. From an investment standpoint, what pitfalls should an investor look forward today?
[00:29:36] Chris: I think if you’re looking at what’s going to happen with interest rates, I think because of the debt, it’s artificially depressed rates and we’ve seen super low rates. When I bought my first house in 1979, I was thrilled when I assumed a 1300% mortgage. Times they’ve changed a little bit.
[00:29:54] So I think one good thing about buying properties and multi-family units in [00:30:00] that I believe that interest rates have to stay down because if they don’t, it’s just going to cost the government more and more on the interest on the federal debt. So that’s one good thing. I think also with the population growing, it always is going to bode well for multi-tenant housing.
[00:30:19] Another issue is credit, because of COVID a lot of people are thrown into a bad credit situation on a temporary basis. I think if you can be compassionate, while still building your business. I think that would be helpful.
[00:30:35] Mike: Interesting. Thank you for that. I appreciate that insight.
[00:30:38] Hey, little bit on a lighter note. So you’re up in the twin cities. What’s your favorite tourist attraction there?
[00:30:47] Chris: The mall of America is here and I’m not a shopper. I will say that if I had to go anywhere in the world I would go to Bermuda just because of the pink sand beaches. It’s a British colony. The people are [00:31:00] so polite. It’s super clean. I just love it. I probably been there 10 or 12 times.
[00:31:05] Mike: Wow. Interesting. So that’d be a great tourist attraction. How about your favorite restaurant?
[00:31:12] Chris: My favorite restaurant is my kitchen after I catch fresh fish. I remember when I had my house in Cape Cod, I caught a bluefin tuna, and I made a pineapple mango, Serrano salsa, and grill that tuna on the grill. And that was probably the best meal I’ve ever eaten.
[00:31:29] Mike: Wow. Are you going to do that this summer?
[00:31:35] Chris: No, I’m. I’m going to go down to Puerto Rico to check out the tax free. Now it’s called act 60. They have if you have a corporation down there, you pay 4% corporate tax, 0% capital gains tax. And there’s some real tax advantages.
[00:31:51] And so I’ll probably move my residency down there over the winter to stay out of the Minnesota winters. But did you know that there actually is a hockey rink [00:32:00] in Puerto Rico? So I can play hockey too.
[00:32:02] Mike: Nice. Good for you. I know how much you enjoy that. It’s interesting you talk about moving to Puerto Rico because of some of the tax breaks.
[00:32:09] What’s interesting right now, and there’s a lot of talk about it are people leaving California, moving to Texas? Because of the income tax and how out of control some of the taxes in that in California have gotten.
[00:32:26] Chris: Yeah. There’s about a 10% state tax in California, I know a lot of people are moved to Nevada and Texas to avoid the state tax.
[00:32:33] But the nice thing about Puerto Rico is it eliminates the big federal tax. If you make a couple of hundred thousand dollars down there, you’re going to save 40, $50,000 in federal tax. A pretty good raise.
[00:32:45] Yeah, for
[00:32:45] Mike: Sure. Hey Chris, the best book you ever read?
[00:32:50] Chris: No offense to Mike, probably “Principles” by Ray Dalio.
[00:32:57] Mike: It was a great book. Yeah. I don’t take any offense.
[00:33:00] Hey Chris, if anybody wants to try and get in touch with you and talk to you about financial planning about estate planning, wealth building techniques, how do they do that?
[00:33:11] Chris: Yeah, just you can email me at firstname.lastname@example.org.
[00:33:15] Mike: And we’ll have your information on the website and it’ll be in the show notes and all that as well, too. So people will be able to get ahold of you.
[00:33:22] And of course, if anyone has questions and needs to track Chris down, you can always get them through me. Give me a call and we’ll get you directed over to him. I want to thank you for being here today. This was great. You’re a wealth of knowledge and information, and on the lighter side, you’re a lot of fun too.
[00:33:39] People get a chance to experience that with you from a standpoint of being in business or doing business with you, I should say. It was great for you to be here. And listeners, please like us, love us. Go follow us on social media. Do all those crazy things. Help our ratings go up. And we look forward to seeing you. And [00:34:00] listen to us on Tuesdays here at 12 o’clock. Chris, thanks for being here today. I look forward to catching up with you soon.
[00:34:07] Chris: Thanks for having me, Mike and I would encourage you if you’re listening now to go by Mike’s book, it’s a really good book that is the basis of what I believe to you have to start with the end in sight.
[00:34:18] Mike: Thank you. Appreciate that. Have a great day and we will talk soon.
[00:34:22] Kristen: Thank you, Mike, and thank you for joining us for another great episode of Insider Secrets. As always, Insider Secrets is brought to you by My Core Intentions. Join us on social media and visit mycoreintentions.com where you can get expert coaching on all things, multifamily investing in property management.
[00:34:41] We’re looking forward to having you back again next week for more Insider Secrets.