Paying for college on a high income: the full workshop

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Why this exists

1. Why I went looking
2. Other people's experience

What decides the number

1. Two factors that decide it
2. What the wealthy do differently

Why real estate

1. The tax benefits of property
2. How the houses are found and run

Risk and cost

1. What about the risk
2. The true cost in retirement
3. What else is involved

Why I went looking

We're going to get started here in just a second. Thanks again for joining us. Um excited to have you on. We are going to be talking about how to pay for college without sacrificing your financial future.

My name is Lance Morgan, um owner and founder of Leggett and I'm excited to have you on here. Um we've got a lot to cover, but I'm going to give everyone just one more minute to get logged in. It looks like a lot of people are logging in right now. If you are just joining us and if you're just getting logged in, go ahead and put in the chat where you are from and the ages of your kids.

It looks like so far we've got some high school students and some students already in college. So, that is awesome. Very cool. We are excited to show you how to apply these strategies to reduce the cost of college and and all sorts of exciting tax strategies to offset the cost of college and some real estate strategies and all sorts of cool stuff to share with you.

Um looks like Joanna is here from has a 12th grader in California. And welcome Joanna. KB, greater Philadelphia area, kindergartner. Look at him.

Well done. Well done with the kindergartner getting started early. We all wish that we started when our kids were in kindergarten. So, welcome welcome to the webinar.

Glad you started early. From New York, Petra from New York, a junior in high school, but living in Manila. Okay, very cool. Very cool.

Rachel from Phoenix, Arizona, freshman in college. Okay, so we've got some more college students. And Reuben, Reuben from Azusa? Azusa?

Azusa? Azusa Marine, sixth grader. Welcome Reuben. Um awesome.

Very cool. Okay, we'll let everybody keep getting logged in here. Um looks like everybody is getting logged in, but I am going to go ahead and get started. So, again, welcome.

My name is Lance Morgan and we are going to talk about how to pay for college without sacrificing your financial future. So, thanks for joining us. We've got a lot to cover. We are going to primarily be focusing on these four main areas.

First and foremost, number one, how to reduce the cost of college through through strategic financial positioning, even if you're a high-income family. If you're a high-income family and you don't think you're going to qualify for any financial aid, we're still going to show you how to reduce the cost of college. And number two, we're going to talk about how to reduce or eliminate your taxes every year through strategic tax mitigation strategies even as a W-2 employee. We're going to use these tax savings to reduce your income that could also help you qualify for some free money and reduce the cost of college, but it also allows you to offset the cost of college by saving taxes.

So super excited about that. We're going to talk about that. And then, number three, we're going to talk about use real estate to reduce your taxes and pay for college and retirement. And we're going to talk about how to use our done-for-you and turnkey properties.

So don't worry if you don't have any real estate experience or if you don't think you have any time, we are going to show you how to use our done-for-you and turnkey properties to use real estate to reduce your taxes and to offset the cost of college or and and pay for college and retirement. And then, number four, all of this is kind of tied together with leaving a legacy through long-term tax planning and creating generational wealth. And so we're excited to kind of dive into into some of those strategies briefly. All right.

So thanks again for joining us. If you don't know who my name is don't know who I am, maybe you've never been on one of my webinars. My name is Lance Morgan. Very nice to meet you.

I'll give you a quick backstory. As you can tell, there's five reasons here why I'm so passionate about this topic. I have five kids with my two oldest college age, my two middle ones there um high school, and my little guy there, youngest guy, he is in elementary school in his last year there. So, I'm going to be doing this for a while and I got started in the financial industry about 20, little over 20 years ago.

And I was, you know, helping my kids set up 529 I I set up 529 accounts for my kids. I was helping my clients to do the same thing. I remember taking them to kindergarten and they would give you those 529 brochures and encourage you to get started early, you know, and and I did all of that. And so, we focused a lot in the early years on setting up 401(k)s for families, doing assets under management, all the traditional financial planning stuff.

But as my kids got older and as I ended up having five kids, I was very passionate about the topic of college funding, how to reduce the the cost of college, and trying to figure out how I was going to be able to help these kids pay for college without having a negative impact on my retirement. And as they got a little bit older, I started researching it, the cost of college. I thought I was saving enough, but the cost of college was going up eight times faster than wages, as you may know. It's been skyrocketing for a while and I realized that the way that they look at the financial aid and the free money for college, you know, you're actually getting penalized for saving money in 529 accounts.

And so, I started looking at other ways to save for college. And then I realized I was making too much money that it didn't matter. I was not going to get financial aid anyway cuz my income was too high. And then that created another problem.

Not only it was I going to be paying full price for my kids to go to college unless they got some, you know, scholarship money, I was also paying a lot of money in taxes. And so, I was not going to get any financial aid, I was paying a lot of money in taxes, and I started looking at tax strategies to reduce my taxes. And then I thought, man, you know, this is awesome. I loved what I was learning about how to reduce my taxes, but I realized that I was very busy.

I was very busy and didn't have a lot of time. And so I thought, what if I built a team? I was actually um a ment- a mentor and friend of mine um had me read this book, Who Not How. And I was reading this book

Other people's experience

on on Who Not How and the importance of using other people's experience and expertise. And I thought, well, why don't I build a team of tax specialists and real estate specialists, and we could all benefit from this amazing team to be able to help um reduce the cost of college, reduce our taxes, um invest in real estate to be able to pay for college and retirement, and ultimately leave a legacy. One of the things that I've been very passionate about is leaving a legacy. And that is why I named my company Leggett.

Leggett was inspired by the word legacy. So, that's a little history backstory on myself. Now, we've worked with thousands of families over the years um helping them to reduce the cost of college. And our average family spends two to $400,000 per student to go to college.

Maybe some of you are going to be spending even more than that at these top-tier Ivy League schools and going on to get, you know, whether it's a, you know, medical school, law school, something like that, you could be paying more than that per student. Some of you, you know, might be paying a little bit less than that. Maybe they're going to a local state school. But, I think we can all agree that the cost of college has gotten out of control and it's going to cost a lot.

The problem is it's at the worst possible time. We call it the retirement collision when, you know, your kids are getting ready to go to college, you know, you're in your peak earning years. I'm guessing a lot of you are in that 45 to 55 range. You know, you've got kids going to college, one of the biggest expenses of your life, right when you're trying to save and get ready for retirement.

So, the timing, you know, couldn't be worse. There's also what we call the secret cost to college that most families don't think about. Maybe you saved for your kids, you know, to go to college, and maybe you got started when the kids were young, maybe you got started later, you know, because life, you know, just got busy and and you didn't get, you know, you didn't get um enough saved. But either way, you know, you spent all this time saving this money for college.

Let's say that you are, you know, going to pay $300,000 for your kids to go to college, right? Well, what most families do is they take the money that they have and they spend it on college. Now, that might seem like the smart thing to do. That's what I was planning on doing.

I started out when my kids were young saving in 529 accounts and your traditional college savings plan. But what I realized later on was that one of the most expensive um costs of paying for college is interrupting the compounding interest on your money and not allowing that money to co-grow and compound. If you had $300,000 grow and compound in the market for another 30 years earning the same return as the last 30 years, you know, that $300,000 could have grown to over 6.7 million dollars for your retirement years. That's a lot of money in retirement that you're not going to have by simply paying that $300,000 for college.

Interrupting that compounding interest is one of the most expensive costs of college. On top of that, most of you that are on this webinar are probably high-income families. And if you're a high-income family, you're not going to get any financial aid, and you're going to be paying full price for college. But on top of that, let's say that you make $300,000 a year, you're paying a lot of money in just federal taxes alone, right?

You're paying a lot of money in taxes. You've got two major expenses. You've got the cost of college, and you've got the taxes. Now, for me, my income got to the point where I was paying more in taxes than the cost of college.

And so, we've got two major problems that we're dealing with, and that's these kids that want to go to school that's really expensive, but then we also have these high costs of taxes. And if we're paying, let's say that you're paying, you know, almost $50,000 in taxes, and you're going to work for another 15 years, and then maybe even just half that much in retirement, you know, over the next 40 years, you could be talking about $4.7 million dollars of what your taxes could have earned even if you just invested that money at 5% instead of had to pay all those taxes. So, that's a lot of money you could have in retirement if you didn't have to pay all that money in taxes. So, it's very, very expensive, and I'm sure you guys can agree, and that's why you're all here.

That's why we're here together trying to learn ways to reduce these high costs. So, let's start Let's start with number one. How to reduce the cost of college through strategic financial positioning even as a high-income family. The first question that most families ask is, "Where can I get some free money for college?" Now, we all know about what we would call um merit-based scholarships, where it's all about what we call student positioning.

Maybe you have a student that we need to help them to get over here, right? So, that they can get a free ride as an exceptionally gifted student. We want these students to be exceptionally gifted students because then they can get free money for college through scholarship money. Now, some of you might be sending your kids to top-tier Ivy Leagues that don't offer a lot of scholarship money.

And sometimes the local state schools don't offer a lot of scholarship money. So, it's definitely important, but a lot of times the discounts are limited. So, then there's also what we call financial positioning, and that's how we can get need-based financial aid. Now, just curious, I want to check in on the chat.

Um pull up your chat and say yes or no if you think you're going to get financial aid. Just out of curiosity. Put in yes or no if you think you're going to get any financial aid. If you think you make too much money to qualify for financial aid, put no.

If you would think you make, you know, enough money, think you're going to get yes. Um okay. All right, not sure. A lot of no's.

Um a couple of yes's, but it looks like a lot of no's. Okay, Tracy yes's gone down. Okay. So, a lot of you have already realized that you're probably not going to get a lot of financial aid.

Well, how is financial aid calculated? Financial aid is calculated based on

Two factors that decide it

two main factors. I know there's a lot of variables, but two main factors: income and assets. Income and assets. That's why early on in my career, when I started researching this, I thought, man, all this money I'm saving into 529 accounts, that's going to hurt my financial aid.

Safe put 529 in the chat if you have a 529 account. If you have a 529 account, put 529 in the chat. All right? Yep, Gary, perfect.

Tracy, awesome. Anyone else have a 529 account? Ruben, awesome. Carlos, no 529.

Okay, So- Sonia. All right. Okay, we got some coming in. All right, so a lot of you have 529 accounts.

Those 529 accounts are going to hurt you on the financial aid formula. So, what can you do about it? Well, you can move or reposition those 529 accounts and you can put those into retirement assets and other assets that don't hurt your financial aid eligibility, but you still have a high income. If you have a high income, that is going to also work against you.

Now, I'm not telling anyone to quit their job. It's not time to retire, okay? So, if you have a high income, that's just going to be part of your formula. However, if you have high income and assets through what we call financial positioning, you could lower your income and assets.

How do we lower our income? Well, we do it through tax savings that I'm going to talk about next. We're going to talk about tax strategies that can reduce your taxes that saves you on taxes, but it also could help some of you get some free money as well. Here's a couple of examples of some of our clients that got some free money through what we call this financial positioning and tax scholarships or getting tax savings.

So, you benefit from lowering those financial aid numbers to qualify for more financial aid. That's awesome. And you said you got some tax savings. Have you gotten your tax refund check yet?

>> We did. Um yeah, I'm happy to say we owed zero federal and state taxes last year, which was which was kind of nice. >> Did you actually end up getting some tax savings at the end of the day? >> We did.

Yes. We um we bought a box house um and then through the tax team, they were help able to help us file all the correct tax forms and our tax returns came back and it it completely took away all of our taxes. It repaid us back all of our taxes for uh that tax year, it'll affect our our son's education years for his senior year and his senior year in college. And then of course, now we're on the front end of our second son for all four of his years.

So, yeah, it was great. It was just like a great solution that we could just jump right into. >> Awesome, awesome. Okay, now caution.

Not all schools will consider losses on your taxes. Some only look at the income. Typically, private schools who use the CSS profile won't consider losses, but public schools who only use the FAFSA will only look at your tax returns, okay? So, keep in mind that not all of the schools are going to look at your situation the same.

So, you have to kind of work with someone to know which schools you're more likely to get some free money from or not. But the reality, here's the reality. Most of you will end up paying more for college than you would like. Even if you could get some financial aid and some free money, even if your kids get some scholarships, my guess is is that most of you are going to be paying more for college than you would like.

Which brings me to number two. Number two is how we use tax strategies to offset the cost of college. And remember, you have two major expenses. You have taxes and you have the cost of college.

If we can offset your taxes, it kind of helps to offset the cost of college. So, we want to help families reduce or eliminate your taxes every year through strategic tax mitigation strategies even as a W-2 employee. So, what tax bracket are you in? And how much of the federal taxes are you paying?

Well, believe it or not, as a household, adjusted gross income as a household, if you are in if you are making $53,000 or more. If you are making $53,000 or more as a household you are in the top wealthiest families in the country. Believe it or not, half of the families in our country are making less than $53,000 a year. Isn't that crazy?

And the top half of the country okay, pays 96% of all the taxes. 96% of all the taxes are paid by the top half of the country. If you are in the top or if you are making as a household, if you are making $105,000 a year as a household, you are in the top 25% of the country. And the top 25% is paying 86% of all the taxes.

Okay, 86% of all the taxes are paid by the top 25% of the country. Which, if you make over $105,000 a year, you're in the top 25%. Okay. If you are making $187,000 as a household you are in the top 10% of the country, believe it or not.

And the top 10% pays 70% of all the taxes, which of course includes the top five and the top one. You know, 272 put you in the top five, 675 put you in the top one. The top 1% everybody making over $675,000 a year is paying 38% of all the taxes. So, how many of you give me a yes in the chat if you feel like you're paying your fair share in taxes.

If you're if you're contributing if you're doing your fair share to contribute to the taxes in the country, put a yes. If you feel like you're play paying enough in taxes. Okay, yes, we've got some yeses with some frowny faces and some yeses. Okay.

So, you're probably, you know, paying your fair share. Well, here's the crazy thing. Again, like I said before, if you're paying even $50,000 a year in taxes over the next 15 years, and then half of that in retirement, that's $1.3 million in taxes over the next 40 years. And if you could have invested that at 5%, that would be $4.7 million you're not going to have in your hands, you know, because of taxes.

But, the crazy thing is is that the ultra-wealthy, you know, they are in a very low tax bracket, 0.1% true tax rate, um 0.98, 1.3, 3.2. Now, this is old. This was from an article in ProPublica. I

What the wealthy do differently

don't know, it's probably been 4 or 5 years ago. And you can Google it if you want. It's quite fascinating. But, it's been It's often been said that Warren Buffett's secretary is in a higher tax rate than he is.

And the reality of it is is that the ultra-wealthy, they just they just use the tax code to their advantage. You know, it's kind of interesting. A lot of people think that if you're not paying taxes, then you're doing something illegal. Well, the reality of it is, see this book here?

This is a very large, very thick book of the US tax code. And ultimately, it is it is a book of incentives. Have you guys ever bribed your kids with $5 to go clean your car or something like that? Well, guess what?

The government, they can't bribe you with any money cuz they don't have any money. What they can do is they can bribe you to start businesses, invest in real estate, and invest in oil and gas, and all these things they want you to do by giving you tax benefits, okay? They give you tax benefits. They They allow you to reduce your taxes by doing what they want you to do, okay?

The tax code is a book of incentives. Okay? I'm going to say that again. The tax code is a book of incentives.

So, what if the money you are paying in taxes could pay for your kids college? I know it sounds crazy, but I want to walk through a couple of examples with you. Now, some of you might be thinking, but I'm a W-2 employee, I'm not a business owner, so I don't qualify for all these tax strategies. How many of you are a W-2 employee?

Put in W-2 if you're a W-2 employee or like a 1099 employee would also be the same thing. But, if you are a W-2 employee or 1099 employee, um put in W-2 or 1099 in the chat. Yeah. Okay, Gary, Sonia, Patrick, Carrie.

Okay, it looks like a lot Yep, Jackie. Okay, Athena. Okay, a lot of you a lot of you are W-2 employees. Okay?

And it's true. It's true that a lot of times as W-2 employee, you don't qualify for a lot of the same tax benefits that the business owners get. But, guess what? There are several programs that you could do.

You could invest in some real estate, and now you're a business owner. You're a real estate investor, you're a business owner, you get all the tax benefits that come from the real estate as well as all the tax benefits of owning a business now. Um you can invest in what they call portable housing. I'll talk a little bit more about that in a minute.

You can invest in equipment leasing. You can invest in solar and battery storage. There's several programs you can invest in, and by investing in these programs, the government gives you tax savings. Okay?

It gives you tax savings. There's also what we call leveraged tax strategies, where let's say that you take out um or let's say that you put a $40,000 down payment on a $400,000 loan to buy some equipment, and then you're able to reduce your income by the cost of that equipment. And then, of course, you lease out that equipment, and that pays for your loan payment, and it could also pay for your kids' college. There are several strategies that use what we call depreciation, okay?

And there's equipment leasing programs, technology leasing programs, and vehicle programs. There's a lot of ways that you can reduce your income and reduce your taxes through some of these tax strategies. I want to give you an example of a portable housing program that is really popular. A lot of our clients love this program for a number of reasons, but this is called, you know, the portable housing program, and I'll explain what that is, but I want to play this short video here.

>> [music] [music] [music] [music] [music] [music] >> All righty. So, this portable housing This portable housing program is crazy. Those houses that I just showed you in that video can actually be folded up. They can be folded up and slid into a shipping container and shipped anywhere in the world.

And they can be set up, they can be taken down, set up, taken down, they can be shipped out to natural disasters, um oil fields, anywhere, anywhere you can think of. So, workforce housing, data centers, oil fields, temporary housing, you know, the fires in Lahaina, you know, things like that, hurricanes, when people lose their houses, you know, any scenario where they need temporary houses. You can lease these houses as temporary housing solutions, natural disasters, um, RV parks, seasonal housing, mountain locations. You can put these anywhere you want.

You can run them as Airbnbs if you wanted to. You can add them to an existing lot if you have room on your lot. Maybe you have an existing Airbnb and you want to add an extra house, um, for some extra bedrooms. Um, it's it's crazy.

You can use these anywhere. And these houses, these houses you put $100,000 down, $100,000 down, you then get a 0% interest loan, a 0% interest loan for 30 years on the other 400,000, and you get to reduce your income by 500,000. So, you put $100,000 as a down payment, and you're able to reduce your income by 500,000. For some families, if you're in a 37% tax bracket, that's $180,000 in tax savings.

So, you put $100,000 down, you reduce your income 500,000, that's $180,000 in tax savings. For some of you, if you only make $100,000 a year, that's 5 years of not paying any taxes. You know, 5 years of tax savings. Now, they have different houses, they have different sizes, they have different, you know, price points, but that's just to give you an example.

These houses then get leased out. These houses get leased out, that makes the loan payment, and gives you cash flow. Though, that's just an example, okay? They are also treated in the tax code, they're treated like a trailer, kind of like this fifth-wheel trailer, because they are mobile, they're not considered real estate, so they're treated a little bit differently, and that's how you get those big write-offs.

But, I want to talk now about something a little bit more traditional that you might be a little bit more familiar with, which is just real estate. I want to use real estate as an example. I want to show you how to use real estate to reduce your taxes and pay for college and retirement by using one of our done-for-you or turnkey properties, okay? So, there are a lot of reasons why we love real estate.

The reasons why we love

The tax benefits of property

real estate is because they have awesome tax benefits that I'm going to go into, but they also offer cash flow. They also appreciate in value. Um houses today are worth more than they were 30 years ago, so they appreciate in value, and you can take loans against real estate tax-free. That's a lot of the ways that, you know, the wealthy get access to money tax-free as they take out loans against their assets, um and loans are always tax-free.

And then, of course, your rent can go up with inflation. So, rent can keep up with inflation, offers offering some inflation protection. But, I want to focus mostly on this webinar, I want to focus on the tax benefits and the cash flow. Let's talk about the tax benefits of owning real estate.

One of the biggest benefits of owning real estate is what they call depreciation. I kind of talked about that a minute ago with um buying these portable houses or investing in equipment. You know, the equipment that you buy, or in this case, the real estate that you buy, um can qualify for what we call depreciation. Depreciation is basically creating a paper loss.

It's a paper loss on your taxes, okay? Now, the reason why we love real estate depreciation is although the government allows us to reduce the value on our taxes, we also know that houses today houses today are worth more than they were 30 years ago. So, real estate actually goes up in value. So, you're getting these tax benefits.

So, like if I buy a vehicle for my business, if I buy a vehicle for my business, I get to reduce my income by purchasing that vehicle. But, the vehicle also goes down in value every year, right? It's worth less and less every year. Real estate on the other hand also qualifies for depreciation, but the value of the real estate goes up.

Now, with the new one big beautiful bill that Trump brought back and made permanent, okay, with what we call 100% bonus depreciation, this allows you to take a lot of that depreciation in the first year. In the first year, it's what we call bonus depreciation. So, the example is um you take a cost segregation study, which is the formula for calculating the depreciation, plus this bonus depreciation, and that allows you to depreciate in 1 year. The government lets you use these paper losses to offset your actual income using a cost segregation study and bonus depreciation.

Here's an example of a house that I bought last year. This is a cabin on the lake in Idaho, and I bought this house for about $1.5 million, just under $1.5 million, and it reduced my income last year by $456,000. Okay? Here's an example of what a cost segregation study looks like.

Here's the cost of the cabin. Okay? They don't let you reduce the land. They don't let you reduce the land, but I am allowed to reduce my income by almost 1.2 million dollars over the next 39 years, but they allow me to take what they call the five-year property, so that's going to be like your furniture and everything and your appliances and everything and even like the landscaping and fencing and all that kind of stuff.

And they allow you to depreciate that in the first year, which is roughly 30% 30% of what you paid. 30% of what you paid is what you're allowed to reduce your income in the first year through what we call bonus depreciation. So, as an example, a million-dollar house would allow you to use a cost segregation study, depending on the value of the land, to reduce your income by about 30% giving you a $300,000 tax deduction or income reduction. Okay?

Saving you a lot of money in taxes. Now, you might say, "But I'm a W-2 employee. I'm not a business owner. I'm not a real estate professional.

I don't qualify for all these tax strategies." Well, that's the beauty of what we call the short-term rental tax strategy. It's section 469 of the tax code and it is treated like a mini hotel. So, it's considered an active business, which allows you to write off your active income like W-2 and 1099 income. An example would be, you know, your Airbnbs, your VRBOs, vacation rentals with an average of 7 days or less that you're renting it out.

So, if you're renting it out in what we call short-term rentals. Short-term rentals means it's not a long-term rental, okay? It's a short-term rental. You're renting it out for weekends at a time, maybe a week at a time, but an average of 7 days or less and a short-term rental will qualify for bonus depreciation to offset a W-2 or 1099 income.

I remember when I was, you know, like I said earlier, you know, when I was complaining about my taxes one day, one of my clients was the one who said, "Hey, have you ever heard of the short-term rental tax strategy?" And that's what kind of led me down this rabbit hole and I started learning all of these benefits of these tax strategies and that's when I realized that these tax strategies that could offset your income could also help some families get free money for college. And so, it all came full circle and I thought, "Oh my goodness, we need to share this with everybody, okay?" Um now, if you're like me, at the time I thought, "Man, this sounds really cool, but I don't have any time. I'm running a business and I have five kids and it's busy and and I just didn't have a lot of time." And you might be thinking, "I don't have time to be a landlord. I don't want to manage some Airbnb." And you are right, okay?

Airbnbs are a lot of work. But, the best part is is that we can do it for you. We can do all the heavy lifting for you. We can help you find the properties with our acquisitions team.

We can help you analyze the data for all the income projections with our data analysis team. um we can help you transition and renovate the property. Okay, we can help you design it for a unique experience for your guests, and we can even manage the property and guests for you. So, if you've always wanted to get into real estate, but you didn't have a lot of time, you don't have a lot of time, you know, that's what this is designed for is for us to be able to help you.

Here's one of our uh clients that went out and visited his property recently and, you know, sent us a text and was all excited. Um here's just some of the pictures of this house that we designed. So, we designed it to

How the houses are found and run

be like a Star Wars theme, like an Ewok village. And as you can see, um the team did a really good job. It's really cool, really cool Airbnb. Here's another property of ours in the um Orlando, Florida area that allows, you know, we get a lot of that um Disney World traffic.

Here's the Frozen-themed room, the Avengers-themed room, um kind of like a Disney-themed game room. Um those are just a couple of examples. So, let's pull all this together. Let's tie all of this together with a case study.

Let's tie all this together with a case study. Let's say that we've got a family making 300,000 a year with one kid that's a senior in high school, and the projected cost of college is $300,000 with the taxes, uh paying taxes of about $50,000. Okay? So, here's the cost of college.

Maybe it's a top-tier private school, maybe it's an Ivy League school with a little discount, maybe they do get some financial aid and get a little bit of a discount. Maybe it's a two kids going to a state school or an out-of-state school, whatever the case may be. But let's just say as a case study, just as an example, let's just say that the cost of college is going to be estimated around $300,000. Okay?

That's the estimated cost of college is $300,000. If you pay for that $300,000 of college like everybody else does, okay? If you spend that $300,000 on college, that money will be gone. That money will be gone, okay?

And it will not be growing. It will not be growing the rest of your life. We all know that money works best over time. Money grows over time.

So, if we spend that $300,000 on college, that money will be gone. Instead, instead what we recommend is using other people's money, OPM, other people's money. Use other people's money to pay for college. So, let's say that we take out college loans, private loans, federal loans, whatever the case may be.

Let's say that we take out $300,000 in federal loans. The loans do accrue interest while the kids are in school. So, by the time you're done, you might owe $347,000, which is going to be a loan payment of $46,000. That's a loan payment of $46,000.

Okay? Now, that doesn't kick in until after graduation. So, we have the freshman year, the sophomore year, the junior year, the senior year of college, and then then you have to start making those loan payments. Okay?

Now, the first thing we do is we go to our database. We have a database of all these houses. These are houses that we've already found. These are houses that are um turnkey, turnkey, fully furnished.

They have self-reported revenue. They They've got pro- They're They're properties. We've got over 100 properties, as you can see. 139 properties to choose from right now.

Um and this one as an example, because I like all these round numbers for my example to show you. This is a million-dollar house. Okay? This million-dollar house is going to allow me to get some tax savings, but it also has some estimated net revenue.

That means after the mortgage payments and all the expenses, the estimated net revenue is $49,000 a year. Why did I choose this property? I chose this property because, guess what? $49,000 a year makes the loan payments.

So, instead of paying cash for college, instead of paying cash for college, I buy this property, okay, with a 25% down payment, 20% down payment, maybe add a little money for some extra furniture or some extra amenities. Okay? So, let's say that I've got a total invested of $300,000 with my down payment and everything. That's the same cost of paying for college, but instead, I now own a million-dollar short-term rental generating revenue to pay for my kids' college.

But, I also, since I bought a million-dollar property, I also am able to do a cost segregation study and reduce my income by $300,000, saving me saving me about $50,000 in taxes. Now, if I wanted to if I wanted to, I could use that $50,000 to go towards college. So that I didn't have to borrow as much. Now my loan payments are less.

I could put my tax savings towards college if I wanted to. Or or let me ask you this. Would you rather use the tax savings to pay for college or would you rather put it towards more real estate to keep getting more tax savings and more cash flow? Just out of curiosity, what would you rather do?

I just want to make sure you're tracking with me. Would you rather take the tax savings to go towards more real estate? Okay, or would you rather just put it towards college? It's the There's no right or wrong answer.

Just curious. Sonya says, "Real estate." Gary says, "More." Awesome. Anyone else? More?

Jackie says, "More." All right, perfect. All right, keep the answers coming. I'll keep an eye on them over there. Anyway, it's up to you.

All right, it's totally up to you. All right, let's go let's dive into this property a little bit more. Okay, let's take a closer look at this particular property. This particular property has actual revenue projections.

But that doesn't always happen. If we don't have actual revenue projections, we just look at market research. Okay? Market research will give us an idea of what our revenue range is going to be on an average or like a top 25% of the market.

We can look at the top 10% of the market. We can see which months which months bring in most of the revenue. We can see what the range is. We can see what the range is and we can look at all of the comps, some comparable listings, to see how this house compares to some of the top properties in that area.

So, in other words, we can do a lot of market research. We can look at what is going to be the total cash invested, what are going to be my or my annual expenses, what's the mortgage payment, what's my tax savings going to look like, what's the cash flow going to look like, you know, all of these details. We do all of this research for you. All of it is done for you.

Now, you might think, "Well, what if it doesn't cash flow enough? What if the house doesn't perform like I think it's going to perform?" Well, guess what? You can always go from a 10-year loan payment of 46,000 a year to spread that out over 20 years if you wanted to and just spread those loan payments out over a longer period of time if you wanted to. Um it's totally up to you.

There's a lot of options there. And you

What about the risk

might be saying, "Well, what about the risk of owning real estate?" What about the risk of owning real estate? Well, guess what? Here's my personal guarantee. My personal guarantee is that if you pay cash for college, if you pay cash for college, I guarantee you that your money is going to be gone.

Okay? I guarantee you your money's going to be gone and I guarantee you that that money could have grown. Now, I don't know what it could have grown to, but I know that that money could have grown. Okay?

So, if you pay cash for college like everybody else is going to do, then you will be losing money. It will be costing you money. So, does real estate have risk? Of course real estate has risk.

But, has has the cost of real estate gone up over the last 30 years? Yes. Has rent increased over the last 30 years? Yes.

So, generally speaking, it's going to be a good long-term strategy. But, you might be asking yourself at this point, where do I find the money? This all sounds good. Okay, this all sounds good, but where do I find the money?

Okay, maybe you don't have $300,000 to put into some real estate. Well, first of all, there's other tax strategies. I didn't go into all of them in a lot of detail, but there's there's the portable housing program. There's other strategies that are even less than that.

So, you don't have to spend, you know, you don't have to buy real estate. There's other tax strategies as well, but I want to talk about where you can find money for these tax strategies. There's three main areas that I want to focus on. Number one, savings in taxable brokerage accounts.

Number two, your 529 accounts. So, I want to talk about that. Okay, and then I want to talk about retirement accounts. So, really quick, if you have a brokerage account, I highly recommend that you don't drain your brokerage account or spend the money, or you're going to pay capital gains, and you're going to interrupt the compounding interest.

Instead, you can take out loans against your brokerage account. You can take out loans and allow your money to continue to compound. You can allow your money to continue to compound. That is the smartest way, okay, whether you have a taxable brokerage account or a life insurance policy that you can borrow against, or just money in savings sitting there would also be a good option.

That's kind of the obvious. If you got money available, that's kind of the obvious option. What I want to spend a little bit more time on is where I get a lot of questions. I know a lot of you have 529 accounts, so I want to talk about that for a minute.

If you use 529 accounts to pay for your kids' college, there are some pros and cons to that. Um or sorry, if you if you use the 529 accounts to invest in real estate. There are some pros and cons to that. First of all, the money it was probably for college anyway, right?

That's kind of why you have a 529 account. So, if the 529 account was earmarked for college, then why don't you just use it to buy real estate that pays for college and also gives you a tax savings. Now, there are no taxes or penalties up to the qualified education expenses for that year. So, if you have kids in college, I know some of you have kids in college.

You can take out college loans to pay for college and you can use your 529 money to invest in real estate and then there's no taxes or penalties up to the amount of those edge qualified education expenses. However, let's say that you don't have kids in college. You're going to be taxed on the gains. Only the gains, not the full amount.

You're going to be taxed on the gains and there's a 10% penalty, but again, only on the gains. So, let's go back to our case study. If we are a family making 300,000 a year, okay, paying $50,000 in taxes, and let's just say we take out um here's our $50,000 in taxes, here's our income of $300,000. Let's say that we have $300,000 in a 529 account.

Well, chances are you don't have more than half in gains. So, let's say out of the $300,000 that I have in a 529 account, 150,000 of that are gains. That means that my income is now $450,000 instead of 300,000 because I um took out that 529 money to buy real estate with. Okay?

So, now my taxes went up to $86,000 instead of $49,000. But, remember, if I buy a million-dollar property with my $300,000 from my 529 account, okay? Then, with my cost segregation study, I'm able to reduce my taxes by $300,000, putting me down to the $150,000, only paying $15,000 in taxes. I still get a tax savings.

I still get a tax savings by taking the money out of the 529 account to buy the real estate with. Okay? Now, you might be thinking, "What about that 10% penalty? There's a $15,000 penalty." Yes, there is, but guess what?

If you pay cash for college, there's also a penalty. It's called the opportunity cost penalty. It's what that money could have earned in the retirement years, and that's a lot more expensive, I can promise you that. So, that cost, the cost of actually using a 529 account to pay for college is way more than the penalty um to put that money into real estate.

Now, I want to talk about a very sensitive subject as well at the end here, which is the retirement accounts. Retirement accounts. Most families say, "I am not using my retirement to pay for college." Okay? Most families like, "I'm not going to use my retirement accounts to pay for college.

My kids um you know, they have more time than I do. I have less time. I'm not I'm not going to sacrifice my retirement." I have I have uh I have to break it to you. I hate to break it to you, but everyone everyone uses retirement money to pay for college.

Everyone does. If you pay cash for college, that money is not going to be there in retirement. Okay? If you take out loans and make loan payments for the next 15 10 10 10 15 20 years, those loan payments those loan payments could have gone towards your retirement savings.

If you take your 529 accounts like we just talked about and pay cash for college, that money could have grown. That money could have grown and compounded. So, no matter what, you are using retirement money to pay for college. That is the true cost.

If you pay

The true cost in retirement

$300,000 for your kids college, that is the true cost in retirement. That's the cost in retirement, okay? So, let's say that we have $300,000 in a retirement account. Like maybe an IRA, like money that you have access to.

You can't access your current employer like if you have a 401k with your current employer, you can't get to that money. But, let's say you have $300,000 in an IRA from an old employer, okay? So, my income is currently $300,000, right? If I withdraw $300,000 from an IRA, okay?

Then, it's going to add $300,000 to my to my income. It's going to add $300,000 to my income. That takes my taxes from $49,000 to $136,000. But, but what are we doing with the IRA?

What are we doing with that $300,000? We're buying property with it. We're buying some property with it that allows us to reduce our income by $300,000. So, now I'm back down to the $300,000, back to paying what I was going to be paying before.

So, here's my question for you. Did you reduce your taxes? I'm curious. Did you reduce your taxes?

Yes or no? What do you think? Just to make sure you're still with me. Put yes or no in the chat if you think you reduced your taxes.

Okay. All right. Looks like we've got some yeses. Yes, you did actually.

You You got We got yeses and some yeses and some nos. Here's the deal. You did reduce your taxes because that IRA money that IRA money hasn't been taxed yet. The IRA money has not been taxed yet.

If you wait until retirement to withdraw that money out of your IRA in retirement, you are going to pay taxes on that money as you take the money out. So, there's a lot of taxes you're going to be paying on that IRA money in the future. But, if you use the IRA to buy real estate with, the bonus depreciation pays the IRS. The bonus depreciation pays the IRS.

So, now you don't Now, you've paid them off. You've paid the IRS off. And if you think taxes could go up in the future, if you think taxes could go up in the future, it might be smart to buy the IRS out now. Pay the IRS off now.

And this is way better than a Roth conversion, just so you know. A Roth conversion, you actually have to pay your taxes. Now, yes, you get to pay the taxes now instead of later if you think taxes are going to go up, but why not use bonus depreciation to pay the taxes. Okay?

Think about that for a minute. So, the other question I want to ask you is how much income are you currently earning on your IRA money? How much income are you currently earning now? I'm not asking about how much interest are you earning.

I'm not asking about the rate of return that you're getting on your IRAs. I'm talking about income. If you are 50 years old and you're not retired yet, if you're 50 years old and you're not retired yet, how much income are you getting on your IRAs? Probably nothing.

I'm guessing, right? Yes, Gary, thank you. Zero. All right?

So, if we used this IRA money to buy a short-term rental that was generating even just conservatively 30,000 a year, that goes up by even just 3% a year over the next 15 years while you're paying for your kids' college, before you're even planning on retiring, that's over a half a million dollars of income from your IRAs that will pay for your kids' college. Now, does that hurt your retirement money? Does that hurt? Does that hurt the the retirement income that you could get on that money and in the future?

No, because once you're done paying for college, what happens to the cash flow from the real estate? The real estate cash flow keeps coming. The real estate cash flow keeps coming the rest of your life. And the value of that million-dollar house goes up.

Okay? The million-dollar house goes up. The cash flow goes up. Okay?

That's a lot of money in retirement. A lot of money in retirement. That So, you're actually paying for your kids' college without affecting your financial future. So, yes, you are taxed on the full amount, and yes, there is a 10% penalty prior to 59 and 1/2.

But, you also get bonus depreciation to pay the taxes. And you get cash flow starting now. Plus, you get those tax savings. Oh Okay, our goal is to help you reduce or eliminate your taxes every year.

That is our goal, and that allows you to leave a legacy through long-term tax planning and generational wealth and leaving your kids with a a good education. Or, you can pay for college like everybody else pays for college, and you can miss out on all that money in retirement, and you can keep paying full price for taxes, and miss out on all that money in retirement you're paying in taxes. All right. So, how can we help you?

How can we help you? Well, first of all, we need to know about your information. We We need to personalize this information to your situation. We want to learn about your income, your tax situation, your financial situation.

Okay, we want to learn about how much you're planning on paying for college, how much money you have saved for college, your retirement situation. Okay, and we want to give you a customized plan on how we can help you. It's a free call. It doesn't cost you anything.

I promise you'll walk away with a lot of value. Um it's taxscholarships.com. taxscholarships.com, or you can scan that little QR code. Um but, you can book an appointment with our team.

Okay, book an appointment with our team, and we can help you to customize a plan. Okay, there's a link in the chat. Daniel just put a link in the chat. taxscholarships.com.

Now, I want to just introduce you briefly to our team. I just want to introduce you briefly to our team. We have a team of college funding specialists. We have a team of college funding specialists that can help you with that financial positioning that we talked about.

We can help you calculate the cost of college for all the kids. We can help you narrow down college loans, which loans to use, and we'll give you lifetime access to our tools, our software. We're going to give you financial aid help to fill out those financial aid forms. We're going to help you narrow down the college selection.

We're going to help you with appeals, and we're going to give you annual support for all the kids, okay? So, our college funding specialist can help you. We also have admissions help, tutoring, merit-based

What else is involved

scholarships. We've got a lot of other things that we can help you with as well, okay? So, tax mitigation specialists, we have a whole tax team that can review your current tax situation. We can help you find annual tax strategies.

That means we are going to try to help you reduce or eliminate your taxes every year is our goal, okay? Annual tax strategy implementation, and we can work with your CPAs. You don't have to fire your CPAs. Um we can work with your CPAs, and we can work with your existing team, and we can help make sure everybody's on the same page.

We also have these done-for-you real estate options from our real estate team. You get access to our scholarship houses database, where we have all of these done-for-you properties. You get access to our acquisitions team that's finding new properties every day. Um we're going to get you the market and property analysis for the revenue projections.

You get access to our ownership transition team that makes sure that we transfer the ownership over, set up all the utilities, do all that, get the insurance in place, all of that. We We've got a renovation team that can go in and do some renovation. We've got a design team that can design and set it up, get it guest ready, and get it And you'll have full-service property management with dynamic pricing team to optimize the pricing. And we even have a nonprofit organization.

Each of our scholarship houses we call them um supports a child that is suffering from a family in um that comes from leprosy in India to get them an education and keep them off the streets. So, each of our houses supports a child's education um in one of these countries like Africa or India where they are suffering from not even being able to get an education. All right. We also have a wealth management team.

This doesn't mean um that you have to fire your financial advisor. We can work with your financial advisor if you have one, but we want to talk about long-term tax and retirement planning. Um we can do some fee-based asset management if you need it. Um we can help you with additional investment opportunities like RV parks, debt funds, RV back uh real estate backed investments, and so on.

Insurance strategies as well, estate planning, and annual reviews to make sure we're always on track. All right. So, why is that important? Why is a team important?

Here's the deal. My favorite book, like I told you earlier, is Who Not How. My favorite book is Who Not How. You can go at it alone.

You can try to figure this out on your own. The reality of it is, you're going to have higher costs because you have less experience. It's just the reality, okay? Or, you can benefit from our team which allows you to get better results and lower costs.

Why? Because of economies of scale and our systems that are dialed in. We have dialed in systems to be able to make this extremely efficient, and you can do what you do best. You know, if you have a W-2 income, you're probably very busy, and you have kids that's keeping you busy as well.

Let us do the rest. It'll save you time and money. All right. Now, what are some of the results?

You know, I wanted to use these portable houses as Airbnbs, and I finally I was going back and forth on some text messages, and they said, "We've been asked to do this at least 100 times. You're the only person that has your process dialed in. So, we have access to tax strategies and off-market deals because realtors love us, tax strategy companies love us because we have several clients, we have about 50 clients a month coming in right now. And so, the good news and the bad news is is we can't help everyone.

I wish we could help everyone, but unfortunately, we can't. And so, that's why we offer a free call to be able to make sure that you're a good fit for our team, to see how we can help you, and to show you how we can help you. So, if you go to taxscholarships.com or scan that QR code, um you can book a call with our team. So, I'm going to play this short video while you are booking a call, and then we're going to jump into questions.

So, put your questions in the chat, go book your call while I play this short video, and then we'll jump into the Q&A. Uh tell me about your experience in working with our team. How's it been working with our team? >> I think that has been truly the most amazing thing is, like you said, it's not here's the material, you paid a price, and now you have access to online web material.

I didn't I wouldn't have found that very helpful at all. This is a hand-held process, and it's individualized and personalized. So, you don't give the same advice, you look at everybody's individual situation, and then guide them through the process. And I found it to be extremely helpful.

I would say that there are truly creative ways that you can get funding for college, and that if you come across Lance's company, you're in the right spot, and you should definitely don't even think twice, don't hesitate. I feel for the small investment that I've put in, I have had a 1,000% return. But I found your company to be so helpful and so knowledgeable, and there's no reason to hesitate because they know exactly what they're doing. >> Your program has already paid for itself, in my opinion, with the savings that we got just from one tax year, and I'm really grateful we can look forward to like many more years of that.

I would definitely recommend this to everyone. I have told a few friends about it, and I I I hope everyone finds you that can take advantage of what you're offering, cuz I think it's wonderful. >> Now, if somebody was interested in learning more about tax scholarships and ways to get creative, what would you tell them? >> I'd say definitely book a call.

The The team here is amazing. The college planning specialists we've got tons of them, and they they all do a fantastic job, and and the key is that they're going to come up with a strategy that meets your specific family situation, cuz everybody's looking for >> Yes, sir. All right. All right, let's go ahead, and let's dive into the Q&A.

Let me go back here. All right. Perfect. All right.

Let me just pull this up, and then let's dive into the Q&A. There's a big barcode you can scan, or go to taxscholarships.com. All right, Daniel, do we have any questions?