Why are conventional retirement plans not enough for today’s retirement investor, and how might outside-the-box thinkers use Self-Directed IRAs to enhance their portfolio? Sean McKay, Executive Vice President of American IRA, weighs in and explains the secret to “outside-the-box” success.

Answering questions for Small Business Talks, American IRA Executive Vice President Sean McKay expressed some unusual notions when it comes to retirement planning and Self-Directed IRA investing.

Here’s the complete interview transcript:

Providence Law is excited to host the next edition of Small Business Talks.   Small Business Talks is a collaborative exchange with dynamic, entrepreneurs from within the greater Charlotte community.  Through their shared stories, you can learn the art of success, benefit your career and personal brand.

Small Business Talks presents Sean McKay, the Senior Vice President of American IRA. Sean teaches investors how to optimize their resources with tools such as their retirement accounts and creative financing.  He has focused his investing on building a rental portfolio as well as providing private lending to other real estate entrepreneurs, through his self-directed account. Sean received his B.A. Degree in Economics from the University of South Florida and has been investing in real estate for the last 10 years. He is currently serving on the Board of Directors for Metrolina REIA, a non-profit organization for real estate investors. Sean resides in Charlotte, North Carolina with his wife, Heather and two children, Blake and Bianca.

  1. In one sentence tell me about your business.

I wear two hats. American IRA, LLC is a leader in Self-Directed Retirement Accounts, which means that individuals truly diversify their portfolio by investing in real estate, privately held companies, precious metals and many other opportunities that are deemed to be “alternative assets”. Second, my wife (Heather) and I operate our real estate investment company that specializes in rental properties.

  1. Why do you do what you do?

I moved to Asheville, NC in 2008 to learn how to become a better real estate entrepreneur from Jim Hitt. He mentioned that he had another business that administered retirement accounts (Ameican IRA, LLC) and that I should come on board and become a part of the firm. Being a twenty something entrepreneur, it didn’t sound particularly “sexy” but I gave it a try.

It has been an unbelievable journey getting to learn from Jim and our entire client base of incredibly savvy investors. The irony is that my primary function is to educate on investing in real estate and other asset classes through retirement accounts, however I find that I get more value from the exchanges than they do! I have a true passion for investing in real estate and I would honestly be involved with American IRA even if I was not compensated, just simply for the techniques and relationships that I have been gained from the experience.

  1. How do your past experiences help you in business and as an entrepreneur?

As I was launching my real estate business in 2007, the real estate and financial markets were starting to crumble. I was born and raised in Florida, which was certainly one of the hardest hit markets in the nation. Many people list the financial markets collapsing as the sole cause of their business failing.  While that certainly exacerbated the situation, for me I didn’t have the necessary skills to thrive in an up and down market. Now that real estate is smoking hot again, I find that there are many people making a lot of money.  However, I would caution those individuals not to get complacent and save as much money as you can for a rainy day, you never know what the future holds. I am a firm believer that you need to constantly educate yourself so that you can be a better entrepreneur. My wife and I have focused on slowly building a rental portfolio while keeping significant liquidity on hand.

  1. Those that know you well really respect your business savvy. Why is your business a success?

I would argue those people do NOT know me particularly well, haha! American IRA has been a success for three reasons. Our founder (Jim Hitt) is a true expert in self-directed techniques, which allows us to share cutting edge concepts with our clients on how investments can be made. We do not advise clients as to whether a particular asset is appropriate for their portfolio, however the examples that we use in our educational platforms are outstanding.              Second, our processing team in Asheville is a group of intelligent and dedicated individuals that works their tails off to process paperwork for clients to be able to make their investments, which is not easy considering the substantial financial legislation that has come out over the last few years.

              Lastly, I have been incredibly lucky to ride the positive momentum of an industry that is growing by leaps and bounds. In my investments company, we seek out incredibly smart people to help us analyze opportunities. Before pulling the trigger on a new acquisition, Heather and I will bounce the idea of off at least 3 trusted advisors, to get their perspective. I am a big believer in making business a team sport and knowing where your weaknesses are. I have found that the most successful individuals are asking questions and absorbing information, not the individuals that are in love with their own voice. They tend to receive feedback in a non-emotional way as well; they are not offended when someone disagrees with their analysis.

  1. What advice would you give someone fearful of starting his or her own business?

Don’t try to plan out the next 10 years of your business before you take the first step, there are too many variables to account for. Try to start with a realistic, short-term goal, to get to profitability. Keep overhead low, you don’t need a fancy office or a ton of employees to start, just focus on the fundamentals.

  1. What advice can you give an entrepreneur regardless of industry- from a coffee shop owner to a plumber?

Frankly, I do not believe that I am worthy of giving others advice as I am first and foremost a student of business but I have appreciated those that have shared with me how careful we must be with leverage/debt. Certainly in real estate, leverage is typically a necessary element to launch our business but all leverage is not created equal and borrowing 70% of the value of the property, with a fixed 30 year mortgage will typically serve you better than a borrowing 90% of the value of the property with the lender wanting to be repaid in the next 12 months.

  1. What famous entrepreneur or social leader has most impacted your life and why? How is this impact present in your work today?

Great question! Charlie Munger is one of the most fascinating businessmen that I have ever read about. He has survived terrible personal tragedies but has never felt bad for himself and from what I have read, seems to appreciate some form of balance with his family while managing to become a billionaire! He has been a great example of how to act in the face of adversity and that is an area that I look to improve personally. Charlie Munger has spoken countless times about staying in your “circle of competency”, meaning that you should invest in what you understand. It doesn’t matter how small the circle is, the important thing is to stay in the middle of that circle! I strive to do one or two things adequately so that I call make progress, I have a very narrow focus in our real estate investment company. I have an unbelievable wife and two beautiful children and so I tend to gravitate towards those that have been successful yet appreciate the importance of family.

  1. What book has had the greatest influence on your career and why?

Think and Grow Rich by Napoleon Hill. It is a great template for how we must focus when trying to accomplish anything of significance. I will use those same principles with my children regardless of what their passion might be.

  1. Lastly, and definitely most importantly, who is your favorite Panther?

Greg Olsen! I loved the Miami Hurricanes growing up and I appreciate how involved he is in the Charlotte community. Thanks so much for the opportunity to share some thoughts.

To contact Sean McKay at American IRA, please call (704) 633-8155 or email at [email protected].

Contact Providence Law, and attorney Craig M. Morgan, Esq., at 704-412-9450 or [email protected].