Dore Law - September 2021

Dore Law - September 2021

THE D or É R eport

D ore L aw . com

SEPTEMBER 2021

INVESTING IN REAL ESTATE USING A SELF-DIRECTED IRA

Most Individual Retirement Plans (IRAs) are set up to make traditional investments in stocks, bonds, and mutual funds. However, the laws applicable to IRAs also allow you to set up what’s commonly known as a Self-Directed Individual Retirement Account (SDIRA) to make other kinds of investments including real estate. Although there are no legal distinctions between the two types of IRAs, a SDIRA does have governing documents and a third-party custodian that allows your IRA to invest in assets that are not traditional for IRAs. The SDIRA becomes a way to diversify your retirement “nest egg” with many more options than just stocks and bonds. Most people feel that real estate is a stable builder of wealth over the long term. Historically, real estate may be the most traditional of all investments, but few people understand how to use their IRA to invest in real estate. As with any investment, there are risks, and you must do your homework (due diligence) on the merits of the investment and make sure all the legal formalities are followed. But using a SDIRA can provide additional benefits to your real estate investments by growing tax-free and delaying any income tax until your retirement years. There are several ways to invest in real estate using a SDIRA. Some people simply buy promissory notes backed by real estate assets to earn above-market interest rates on their money — short or long term. Another option is to invest in syndications to join other investors in owning multifamily or commercial real estate. With a SDIRA, it is even possible to directly own properties. A few ambitious investors use their SDIRAs to fix and flip properties. If you decide to expand your options on investing retirement monies, the first step is to find a reputable company that is well established to act as the custodian for your SDIRA. At the law firm of Doré Rothberg McKay, we have helped clients with the legal aspects of real estate investing, buying, and selling for decades, and we can recommend reliable custodian companies should you be interested in starting your own SDIRA.

The next step is to decide what kind of real estate investor you want to be. As Derreck Long of Quest Trust Company explains, “ Active or passive — what works best for you? Passive investors can grow their IRAs by finding investments that don’t require hands-on management. For others who can devote more time, active investments in real estate may involve dealing with tenants and property repairs, but you keep all the rewards.” Custodian companies like Quest will work with you to find opportunities that fit how you want to invest. When you are ready to invest your SDIRA, it is always best to have your attorney and your tax advisor review the transaction to avoid potential problems. Although the Self-Directed IRA has been around a long time, most people are still not aware of all the options available to invest in their retirement.

-Carl Doré Jr.

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If You Want a Healthy Business, Nurture a Healthy Mind

PIVOT WELL AND STAY POSITIVE.

Entrepreneurs drive the economy forward with innovative solutions to big problems in business. How different businesses have weathered the pandemic this past year is proof of that. However, while entrepreneurs generate success for their businesses, one aspect of that role isn’t discussed enough: their mental health. According to Dr. Michael Freeman, a psychiatrist who studies how entrepreneurship affects the brain, entrepreneurs are more susceptible to a number of mental health conditions than non-entrepreneurs. They’re 30% more likely to suffer from depression, 29% more likely to live with a hyperactivity disorder, and 11% more likely to fall on the bipolar spectrum. The confidence of your customers and workforce depends, at least in part, on your mental health, which is why every entrepreneur should consider seeing a mental health professional. However, abiding by a few basic principles can also help you nurture a healthy mental state.

The unexpected will happen. Ironically, that’s all you can expect as an entrepreneur. So, when you put together plans to grow your business, make contingency plans as well. Just because you have those back-up plans does not mean the worst will happen. If something unexpected does happen, instead of immediately considering all the possible negative outcomes, think of the potential positive outcomes instead. Remember that just because the steps to achieve your goal might shift, it doesn’t mean your goal has to change.

SCHEDULE TIME TO DO THINGS YOU FIND RESTFUL.

We have a pretty good idea of how to improve our physical health in various situations: If we’re cold, we throw on an extra layer. If we want to lose a few pounds, we exercise and eat some vegetables. However, when it comes to improving our mental health, we might be at a loss.

THE MOST AFFORDABLE 'FIX' FOR YOUR BUSINESS

What if you found a cheap way to “fix” your business so old customers would stay and prospective new customers would want to buy from you? I’m talking about something that works regardless of what you sell or the size of your business. This “fix” also works for an individual department or segment of your business. You can use this whether you’re the president or just a manager. The magic fix = Customer Experience . It’s no secret that customers stay where they have a great experience. Not a satisfactory experience, a great one. Most businesses are working to avoid the customer having a bad experience because we all know those customers usually leave (and tell everyone else). HOW. It’s a backward process. Steve Jobs once said that to make incredible profits, you had to start by looking at the customer experience and work backward to the product. You must think like you are the customer. What is the “experience” like working with your company from the first phone call to the completion of a project or sale? Did your company make it easy? Did everyone work to understand my problem and solve it? Was the process and the cost always transparent and free of surprises? Did I always get the attention needed and prompt responses to my concerns? Did everyone at your company give me the feeling that they were “on my team” or just doing the minimum required? WHAT. Review the people and the processes in each segment of your business, looking at what the customer sees. I know that the business has designed itself to make things work well for the employees and to be efficient enough to generate profits. That’s good, but that’s

focused internally on the company’s experience. Now, think of how the customer views and experiences your work. Do the same work-flow designs include the customer having a great experience? What small things could you add to improve customer satisfaction? Do you have a system to ensure a consistent product delivery? We are not talking about getting better results or improving what you sell to the customer. Your company is already laser-focused on good results or the rest won’t help. But customers will leave a company with a great product for another company with only a good product if the other company consistently gives them a great customer experience. And customers will always leave if they believe you don’t appreciate them. WHY. It’s not enough to be the best at what you do. Contrary to what you have heard, the world will not beat a path to your door if you build a better mousetrap. Customers will buy mousetraps from where they are treated the best — even if it’s not the best mousetrap! So, design that better mousetrap as your goods and services. Then, when you are finished designing your department or your company to be efficient and profitable to satisfy the employees and the owners, it’s time for another important “fix.” The good news is that this fix is usually inexpensive. Tweak all your procedures, communications, training, and feedback with a focus on the customer experience. Do everything you can to make sure every customer has a great experience with you. NOW. And now, if you ever (and I mean ever!) feel like we are indifferent or apathetic to your problem, I hope you will give me a call. I consider that as unacceptable. Even law firms can fall victim to the “bad customer experience” problem.

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According to the Harvard Business Review, the best way to rest your mind is to force it to work on a singular task, such as a puzzle, craft, or exercise routine. So long as you find the activity restful and it takes your mind off work, you should set aside time to do it for the sake of your mental health.

LIMIT THE TIME YOU SPEND ON SOCIAL MEDIA.

Expanding Our Leadership Team

The world is a chaotic place — it always has been. The only difference is that now, we have the means to see everything happening on our planet through our computers and smartphones. It’s good to stay informed, but when we let the media noise dictate how we feel on any given day, it might be time to curtail social media exposure. The world will continue to turn, even when we’re not looking. The above tips are by no means prescriptive. You can take parts of one or a couple of them and leave the rest. The point of sharing these tips, however, is to encourage you to do something. As an entrepreneur, you can’t afford to ignore your mental health and hope everything is okay. So, take some of this information and use it to build success in your business and your life.

We're proud to add Brent Doré as a shareholder and Andre Stanojcic as a Sr. Associate. Carl Doré – Managing Shareholder Lisa Rothberg – Director of Liens & Transactions Zach McKay – Director of Bankruptcy Brent Doré – Director of Litigation & Ft. Worth Office Andre Stanojcic – Director of Contracts & MSAs www.dorelaw.com | 281.829.1555 Offices in Houston & Fort Worth

WORD SEARCH

EASY PEACH COBBLER

Inspired by MyRecipes.com

Celebrate the end of summer — and peach season — with this simple and tasty peach cobbler!

INGREDIENTS •

1/2 cup unsalted butter

1 cup milk

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1 cup flour

4 cups peaches (fresh is best!)

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2 cups sugar, divided

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1 tbsp lemon juice

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1 tbsp baking powder

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Ground cinnamon or nutmeg to taste

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Dash of salt

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DIRECTIONS 1. Preheat oven to 375 F. In a 9-by-13-inch baking dish, add butter and place in oven. Remove when melted. 2. In a large bowl, combine flour, 1 cup of sugar, baking powder, and salt. Then pour in milk and stir until the mixture is smooth. 3. Pour the batter over the melted butter, but don’t stir! 4. In a pot, bring peaches, lemon juice, and remaining sugar to a boil. Stir constantly. 5. Pour peaches over batter, but once again, don’t stir! 6. Sprinkle with cinnamon and nutmeg, then bake at 375 F for 45 minutes.

GRANDPARENTS HARVEST

ABUNDANT APPLES COOKOUT CRUNCHY FALL GOLDEN

LABOR MAPLE SPORTS WINDY

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Investing in Real Estate Using a Self- Directed IRA How You Can Improve Your Mental Health as an Entrepreneur

The Most Affordable ‘Fix’ for Your Business

Expanding Our Leadership Team

Easy Peach Cobbler

‘Zero to One’: A Book Review

HOW TO GET FROM ‘ZERO TO ONE’ CREATE AND NURTURE ORIGINAL BUSINESS IDEAS

“What important truth do very few people agree with you on?”

tried creating something wholly unique, developing an original idea is no easy task. The difficulty of originality even led Mark Twain to once say “There is no such thing as a new idea. We simply take a lot of old ideas and put them into a sort of mental kaleidoscope.”

That’s entrepreneur and author Peter Thiel’s favorite interview question. To Thiel, a person’s answer to that question provides insight into whether they’ll be able to find success as an entrepreneur. Ideally, if you can answer with something like “Most people believe in X, but the truth is the opposite of X,” then you’re well on your way from zero to one and creating an original business idea. That’s what Thiel explores in his book “Zero to One: Notes on Startups, or How to Build the Future.” “Zero to One” is all about coming up with and nurturing unique ideas, which are the foundation of game-changing businesses. As a co- founder and investor in a number of companies that have changed the business landscape, Thiel has some authority on this subject. He co-founded Cofinity (which later became PayPal) and invested in startups like Facebook, SpaceX, Lyft, and Airbnb whose ideas were so novel at the start that they were perceived as risky by many. Throughout the book, Thiel shares his wealth of knowledge garnered from a long, successful career of recognizing and acting on original ideas. According to him, and anyone else who has ever

But in “Zero to One,” Thiel proves that coming up with

original ideas is possible, and he provides readers with helpful tips and lessons for how to get there. One such lesson: Stop trying to be the next Bill Gates or Mark Zuckerberg because “if you’re copying these guys, you aren’t learning from them.” Thiel uses his favorite interview question to try to identify original thinkers. These are the people who take their businesses from zero to one because they looked at past successes and thought, “I can do it differently, and I can do it better.” If you want to be in that group, then reading Thiel’s advice in “Zero to One” is a great place to start.

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