From Divorce and Financial Rock Bottom to CEO of Self-Directed IRA Powerhouse with Kaaren Hall

Speaker 0

Today, we chat with Kaaren Hall. Kaaren is the founder and CEO of Udirect IRA Services. She started the company in two thousand nine, and you'll hear it's a pretty dramatic story about, how she started the company with very humble beginnings. And the company now oversees more than three one point three billion dollars in assets. And Kaaren went through some very challenging times, went through a divorce and was a single mom and really had, it sounds like, no money, next to nothing. And you're gonna hear how she was doing really well in a particular job, and all of that changed instantly. And she was kind of at rock bottom and, really had to navigate some very serious personal family and business challenges in two thousand eight, two thousand nine. And that's when she founded the company, and and we walked through some of the challenges of being an entrepreneur and how she's been able to overcome those and how she's been able to integrate her children and educate people around her. She also runs, an investing club in Orange County, California. And, I mean, she's just a very positive influence. She was able to produce a a a book recently, or I should say write a book with bigger pockets, and she's just very active in the investing space. We get into some nitty gritty about how self directed IRA accounts work, what you can invest in, what you can't invest in, how you can open an account if you don't have one. And a lot of people still don't know about the self directed IRA space. We also talk a lot about how it pairs very well with mortgage note investing and private lending. So I think you're gonna enjoy this one. Yeah. It's a very a very uplifting and positive, feel comes from this episode. I hope you enjoy it. 

Speaker 1

From adversity to abundance, hosted by entrepreneur and seasoned real estate investor, Jamie Bateman, is the ultimate guide for active and passive investors seeking clarity, mental fitness, and the confidence to make inspired decisions in the world of real estate. With a decade plus of investing experience across various niches and a background as a combat veteran, former army officer, and multimillion dollar mortgage note company owner, Jamie brings a wealth of knowledge and inspiring stories to each episode. Through weekly episodes featuring insightful interviews with industry leaders and solo explorations of mindset and strategy, listeners will uncover actionable advice and tips to overcome challenges and build lasting financial success. Whether you're a seasoned investor or just starting, from adversity to abundance is your road map to turning obstacles into opportunities and achieving financial freedom. 

Speaker 0

Welcome, everybody, to another episode of the From Adversity to Abundance podcast. I am your host, Jamie Bateman. And today, I'm thrilled to have with us Kaaren Hall. Kaaren is the founder and CEO of Udirect IRA Services. Mhmm. Kaaren, how are you doing today? 

Speaker 2

I'm doing great. How are you, Jamie? 

Speaker 0

Good. I know you got a little bit of a cold, so I appreciate you still, fighting through that. 

Speaker 2

It's my adversity today. Yeah. 

Speaker 0

Exactly. Exactly. Hopefully, I I know I know you've overcome more than that in in the past. 

Speaker 2

I have. Yeah. 

Speaker 0

I think we'll get through this. But, thanks for joining us today. For the listener who may not be familiar with you, I know you you've done this many times, and your name is is out there quite a bit. So you've got a lot of experience in doing podcasts and presentations and things. But for the listener who may not know who you are, can you give us a kind of an overview of of who you are today, what you're up to, and some of the abundance that you're living in? 

Speaker 2

Sure. I'd I'd love to. I mean, so okay. Alright. Well, like you said, my name is Kaaren, and I'm the CEO, founder of uDirect IRA Services. I also founded a real estate investment club that's called OCRIA for orange county real estate investors association and acronym there. And so I have these, two companies. And so what we're focused on is investor education and helping investors use retirement dollars, not just for their investments, but you can also use other people's money to raise capital for your deal. So that's what we do in the two companies is, you know, education and, and basically it's about helping people with their prosperity in general. And so personally, I'm a mom. I have two kids who are grown, and I am a grandma. So 

Speaker 0

Oh, wow. 

Speaker 2

Bring it. Yeah. Congrats. It's wonderful. Yeah. It's pretty great. And just and that's amazing. But, you know, life life is is a lot more comfortable than it was when I started uDirect, and I'm happy to to talk more about that. But, I mean, you know, there's I don't have financial hardships like I had at the beginning. Yeah. The challenges are different. 

Speaker 0

Yeah. No. That's a good way to put it. And and we do keep it real on the show. We don't pretend that that anybody is done with challenges. You know? They've they've arrived completely. Right? Whether it's health, relationship, financial. And before we jump into your backstory, what has, you know, financial abundance done for you? You say the challenges are different, but on the financial side, it sounds like you've got a little more security or or peace of mind. What what does that look like for you today? 

Speaker 2

That's a great question and very timely because I had a birthday, you know, recently. And just, you know, I don't know how it happened, but it happened. I got invited to Paris Fashion Week to join as a VIP and sit in the front row. 

Speaker 0

Oh, wow. 

Speaker 2

Do you want do you want to do this? I'm like, yes. Yes. I do. 

Speaker 0

So I 

Speaker 2

use my frequent flyer miles, you know, and and, like, two hundred and thirty seven dollars to do first class round trip to Paris. It was crazy. So many good things happened. And as a result, I my friend and I, who who went with me, who and she speaks French. I didn't realize French was her first language. You know, I learned that about her. So we went together, had the most fun. And after all, it was all over. We ended up on on the cover of a fashion magazine, a Paris fashion magazine. So that was 

Speaker 0

just wow. 

Speaker 2

Beyond my wildest dreams. It has nothing to do with self directed IRAs, but everything to 

Speaker 0

do 

Speaker 2

with self directed IRAs because that's the foundation. And that's these are the crazy things that can happen to you that and opportunities that just find their way to you when you're looking for them. And when you, when you do you know, press on and proceed and 

Speaker 0

Right. Yeah. 

Speaker 2

Absolutely. Do. 

Speaker 0

I, I mean, I think as we Mhmm. As we get older, at least for me, I tend to start saying no. I say no to a lot more things than I used to, and I think that's that's appropriate in general. I think when you're younger, generally, you should say yes to a lot of things and try different things and whether you know, in in your career specifically. But, that sounds like one that you didn't have to hesitate at all. It was like, yes. Yes, please. Yeah. Well, let's jump back into your backstory. You alluded to the fact that you've had some adversity. Things are not, you know, now are not the same as they were, thankfully, from a financial standpoint. So where do you wanna start with your backstory as far as, you know, leading up to some of the adversity that you've overcome? 

Speaker 2

I think maybe we should we could talk about the founding of Udirect IRA services and start from one point and move forward. So at that time, I was divorced and two children who are still in, grade school and and junior high. And then I it was during the great recession and I was in mortgage. I was a mortgage loan officer. Well, you can imagine people weren't making a lot of mortgage loans right now. Right? So that was scary. So the next step that I got a job, helping a friend of mine who works at Northwestern Mutual and helping them with their marketing efforts, in in their business. And I did that for about six months or so. But at that time, again, it's funny how, when you put yourself in the right position, things come to you that you couldn't imagine. And someone came to me and said, Hey, why don't you look at working at our self directed IRA company? Someone, you know, mentioned me and introduced me. And, and at that time, again, good fortune shows up and I had been in a magazine. I did whatever. Again, something I didn't seek, it just boom happened. So 

Speaker 0

Right. 

Speaker 2

A national ad campaign about my database, for a company called card scan where you it's a little thing you slide your card in and it puts it into a program. And then it was a really cool little gizmo. And this was some time ago. So I go in for this interview. They see my, you know, this ad, national ad I have about my database. And now they I got hired. So they said, well, we want you to open fifty accounts a quarter. And so after a couple years, I was opening fifty accounts a month. And yeah. And then they walked in and said, we're going to need to let you go. 

Speaker 0

Really? Wow. 

Speaker 2

Yeah. Yeah. 

Speaker 0

You were crushing the quota by three times. 

Speaker 2

Yeah. So I said, why? And they said, you created a negative culture with someone at corporate. It's like, I get along great with everybody at corporate. What are you talking about? It didn't matter. They just, you know, they wanted to let me go. 

Speaker 0

Right. 

Speaker 2

And, and that's what happened. So, you know, I wasn't going to argue my way out of that. The decision had been made. So Right. Get in the car, like, okay. Here we are. Two kids Yeah. Mortgage. 

Speaker 0

And this what year was this? 

Speaker 2

Two thousand and nine. 

Speaker 0

Okay. Yeah. I mean, two thousand eight is when all that began, right, with the real estate crash. And then Yeah. Two thousand nine, two thousand ten was still pretty low from a market standpoint. And then, obviously, on the personal slash family side, things weren't were were pretty low for you as well, really challenging. So I can't I can't imagine that. So what's going through your mind at that point? 

Speaker 2

Two things. I mean, you know, obviously a lot of emotion over what's gonna happen, the worry, how am I going to do this? What are my skills? Because my my very first career when I was, in college and and then out of college for seventeen years, I was a radio announcer. So, so, okay. Now we live in orange County, California. And, and, and by the way, simultaneous with being in radio, I would also, I was also a realtor and I was a property manager and I was in real estate at the same time. So, okay. So that was my previous. So what am I going to do now? Am I going to sell real estate in the skirt recession? No. Am I going to make mortgages? No. Am I going to be a radio announcer? I live in Orange County and radio is in LA and California. No. What are my skills? My skills, self directed IRAs. So long story short, very long story, I put together a spreadsheet of what I'd produced. So I have this spreadsheet 

Speaker 0

Yeah. 

Speaker 2

And I started talking to trust companies, banks about, about holding the capital from the accounts that I can create and and generate because that's Okay. Something that I'm very good at. So I spoke to several, and couldn't come to a terms that were that would work for the company that would be, you know, financially feasible. Yeah. And then someone said, look, I'm working with this trust company over here. Why don't you talk to them? 

Speaker 0

K. 

Speaker 2

I did. Sat down. I said, here's my spreadsheet that, this is my track record. This is what I can do. I need you to hold, you know, the accounts to the financial management, the cash management on these and do your job, which is be the trust company. And then what I'll do is, you know, the the education, the customer service 

Speaker 0

Right. 

Speaker 2

And everything. Yeah. Yeah. Yeah. All that. 

Speaker 0

So on the spreadsheet just sorry to sorry to interrupt, but it was just Yeah. It was a a spreadsheet, listing your accomplishments and the accounts you'd, created and managed, or what what exactly was on the spreadsheet? 

Speaker 2

Well, it it was my track record, but it so I had a friend of mine help me who Yeah. Was who's an electron, electronic engineer, an electrical engineer and knew how to put, like, what do you call them? 

Speaker 0

Like like 

Speaker 2

Formulas in the cells that would just be 

Speaker 0

look up and all that stuff. 

Speaker 2

Oh, so beautiful. Yeah. So it was a bit real really pretty slick. And, 

Speaker 0

I don't even know. 

Speaker 2

I don't know either. You know? That's not my thing. I mean, I use Excel every day, but not to that level. And so it it was it it showed my track record, showed what I could do, and that that was there was just no question. There was there was Yeah. You know, an ability and a need, and it meant Right. 

Speaker 0

Well, I love the and it and we're we obviously will move on, but I'd love that you, one, looked at the outside at the market and first looked at, like, what what do people need. Right? What's going on in the market right now or in real estate or whatever? So what where is their need? Then you also next look at what are you good at, what are your skills, and what were your accomplishments. And I was just curious if the compiling that spreadsheet, I feel like that's an easy step to skip over. And I was just wondering if that did anything for you mentally. You know, obviously, the goal is to show the your results, your track record to to people who may hire you or work with you. But did that do anything for you mentally to build your confidence? 

Speaker 2

It it sure did. I mean, I in in that time, there's obviously a lot of emotion. You know, because, like, how? And in in you don't you don't always see you don't you never see the road ahead. You know? You always see 

Speaker 0

the track. Right. 

Speaker 2

So I thought, well, what I need to do is think logically. So looking at like, forget the emotion, put it about try to put it over here 

Speaker 0

Right. 

Speaker 2

And look at the facts. So, so that really helped ground me, into, into facts. But also I read, the E Myth by Michael Gerber. And that was very helpful, you know, that, that just Sally the pie baker could bake the pies, but could she be a CEO and what that would take. And so that was a, you know, a really, really great book at the right time. 

Speaker 0

Sure. 

Speaker 2

And and then just just one step at a time, I remember that a friend of mine said, look, I'm doing this big event. If you can sell tickets, I'll give you half the ticket price. So I sold a bunch of tickets and I don't know, I think I had maybe, maybe two grand that I earned from doing the selling tickets to this event. And I was a real estate, you know, promotion event. Anyway, I, took that two grand and it founded uDirect. So I opened up a u I I, you know, for free or seventy five dollars, I filed an LLC with the state of California 

Speaker 0

Yeah. 

Speaker 2

And upfront seventy five dollars. And then I opened a bank account. I found a, off a business suite, office suite for four hundred dollars a month. Wow. So it's so I'm in a borrowed chair and a borrowed desk with a laptop and a cup of coffee. This is you direct. 

Speaker 0

Wow. 

Speaker 2

And I have two grand, Like, go. 

Speaker 0

That's that's incredible. It is isn't it at least, like, eight hundred dollars a year to renew your LLC and 

Speaker 2

It is, but it's not till the That's first. Till the tax Twelve months. Finally deadline. Thank goodness. 

Speaker 0

Got it. 

Speaker 2

And just, you know, a wing and a prayer. Right? 

Speaker 0

And That's amazing. 

Speaker 2

And, again, things you know, as as you put it out there, things come to you. You say, this is what I, you know, what I can offer. This is what I need. And 

Speaker 0

Right. 

Speaker 2

You attract those things Right. To you. And and thank goodness I did. Because I 

Speaker 0

no. And I that one. Definitely agree with that, but I also do wanna point out that you were taking action as well. I mean, you weren't just sitting there in your basement or wherever, you know, in in your apartment, wherever wherever you were, like, just manifesting and not taking action. You also I it's pretty obvious you're you you, are a go getter and do you know, take steps and take action. So I think you I do think both of those things combined. I do agree things start to come your way. Blessings come your way when when you're Okay. 

Speaker 2

You know, 

Speaker 0

in the right mindset and you're taking the right steps. So, okay. So then okay. So you've essentially founded uDirect with, like, almost no money. I mean, it it and then you're sitting there and it's just you. So now what? What are what's how do you make this a real business? 

Speaker 2

Yeah. And I wanted to go back to your point about taking action. That is something that I learned when I was, you know, in my twenties from Tony Robbins. 

Speaker 0

And 

Speaker 2

that was taking massive action. And after listening, it was back in the day with cassette tapes. I put them in my car, listened to Tony Robbins way back then and how it takes massive action. So that's what I'm thinking. I everything I could think to do, I would do. And that was really, I I'd say, a good key. And so, but then, so just what was your question again? 

Speaker 0

Oh, no. Just that you're sitting there with your bar in your bar chair and everything is barred. You have no money. Okay. 

Speaker 2

Cup of coffee. Yeah. 

Speaker 0

Do you have a real business at this point? Yes. It's registered with the state. But I mean 

Speaker 2

Right. 

Speaker 0

Okay. How many of those go defunct most? Right? 

Speaker 2

Well, well, yeah, most of them do. And now we're in our seventeenth year. So so I opened the first account and it was so exciting because I I got fifty dollars fifty dollars set up being like, I'm rich. You know, I can put gas in the car. I can feed the kids. This is so great. You know, and and there was never a point. And I want to tell you, though, this is I mean, you know, I'm a Christian. This is God's grace in my view that that that we we I never missed a bill this whole time. There were other things that happened that brought in capital just like, you know, pennies from heaven, I would say. Yeah. I can't explain, but things work. And so, but here's my fifty dollars setup fee. Like, wow, my first account, this is so exciting. 

Speaker 0

That's awesome. 

Speaker 2

And then it just is, and then the first year, two thousand and nine, it was really August thirty first, two thousand and nine. When, when all that, when everything was like, go, you know, and I had a website and we were real. 

Speaker 0

Yeah. 

Speaker 2

And start bringing in business. And so by the end of the year, we were really churning. I had made, really great relationships with the owners of the local real estate investor clubs. And I was speaking and and then the you know, that it just started to roll. 

Speaker 0

Started to snowball from there. Mhmm. And we'll later we'll get into some more detail about, you know, what what your company does. But for the listener who may not even know what a self directed IRA custodian is, what what is that exactly? 

Speaker 2

The custodian is the trust company. This the custodian is the company that is holding the asset. So that's what I did with Udirect IRA Services. We're an administrator. So what we do is, you know, is is, with a custodian backing us. So it it's if you go you can go directly to a custodian. There's no difference than going directly to UDirect. You get the exact same service. It's just that I don't own that custodial company, but we we work in tandem and we have Okay. 

Speaker 0

So that's just good, good education for me because I I'll use the term custodian just Mhmm. Broadly. So you direct IRA. I'm sure it's changed some and grown, obviously. But at that point, what exactly what services were you providing exactly? 

Speaker 2

The same services that we offer now. I mean, the self directed traditional Roth SAPS simple spousal inherited solo four zero one ks, but, but also education, especially in two thousand and nine, it was the best time to be in this industry. Everybody wanted me to speak at their event because pretty much people did not understand what is this thing. And here's, here's the surprise, you know, Jamie, that you may not even know that IRAs were created in nineteen seventy five. 

Speaker 0

Yes. 

Speaker 2

So today, it's fifty one years that you've been able to self direct an IRA. 

Speaker 0

I would've invested in the seventies, but I couldn't have given you the year. But yeah. Yeah. Yeah. But but most people didn't 

Speaker 2

know. Right. No one knew. 

Speaker 0

Right. 

Speaker 2

And you maybe you recall, I bet you do, how you couldn't get you like, you normally can get six loans on investor property. Well, at that time, you could make ten loans. You could only get six then. 

Speaker 0

Right. Right. 

Speaker 2

So where were these investors going to find capital? 

Speaker 0

Right. 

Speaker 2

And it was the self directed IRA. So then, boom, I was speaking. I was flying everywhere, and I still do. But, 

Speaker 0

speaking I mean and for I mean, we're not there yet in this conversation, but, I mean, today, I feel like a lot of people don't know that this is even an option. I I you know, because I I do run a mortgage note fund, and I I have a a self direct, self directed IRA myself, and I have for years. And it's like, not that I'm the expert in in all of this, but I've I start to assume everybody knows about it. You know? Mhmm. And so many people still don't know this is even an option that there are only a few things you can't invest in, and we'll get into that maybe, in a little bit. But so alright. So what what did say say in the first, like, three to five years? What kind of growth did your business experience? 

Speaker 2

Of course, we were doubling, you know, doubling because when you go from one one account and you have two, you've doubled. 

Speaker 0

Right. Absolutely. 

Speaker 2

So so we were we're, you know, doubling year over year, which was really great. And and we've hit, you know, hit plateaus and things like that. And then we, you know, research and and figure out ways to break through. But, but yeah, that was that was great. And it was a matter of, again, collaborations, creating collaborations and working with others and, a lot of speaking events. So again, this is how we get the word out, but really no one knew. So knowing the difference between a rollover and a transfer, that 

Speaker 0

blew 

Speaker 2

people's minds, what is that? 

Speaker 0

Right. 

Speaker 2

So it was fun. And now when I speak at industry events, most people are educated in the in the if they're going to an industry event, if they're already at that point. 

Speaker 0

Right. 

Speaker 2

But you're right. When if I go and meet someone socially, what do you do? Well, I have a company. We provide self directed IRAs. It's like Yeah. You know, they don't 

Speaker 0

Yeah. Well and I know some of the larger, you know, traditional well, that's the bad term to use, but I think, you know, Vanguard and some of these larger stock slash bond slash mutual fund 

Speaker 2

Mhmm. 

Speaker 0

Companies do offer something that's called self directed now, but it's not the same thing that we're talking about. But 

Speaker 2

It just means you can pick the stock that you want, which you always could. Yeah. That's okay. Whatever. But to ask them about investing in a note 

Speaker 0

No. They have no idea. What? Okay. So from I mean, definitely, that's a lot of I mean, you know, a lot of adversity you faced on the the personal side for sure. And, I mean, just owning a business I mean, just going out on your own and and starting a business is very it's it's there's so much fear, and, I mean, there's so many reasons it won't work, and it may, you know, it it there's good reasons that it wouldn't work for you. I mean, for anybody. Right? Nine out of ten businesses fail. Right? Mhmm. So two thousand nine through today, I know there were a lot of ups and downs. You mentioned plateaus. Yeah. What were some a couple of inflection points or some some major decisions that you made or things that really, were challenges or or, points that where your business really took off? 

Speaker 2

I'm happy that you asked that question because that's I was just thinking of something at that 

Speaker 0

moment. 

Speaker 2

Okay. That, so in this investor community, I knew these two people had a real estate investor club locally. They had just celebrated their ten year anniversary. Everyone loved them. And it and we had seventeen accounts, or seventeen people who had invested in their deal. 

Speaker 0

Okay. 

Speaker 2

And it turns out that they were actually scamming people. 

Speaker 0

Wow. 

Speaker 2

You know? Who knew? Yeah. I we didn't. The investors didn't. 

Speaker 0

Yeah. 

Speaker 2

And so the, some of the account holders came to me and said, Kaaren, this is going on. You know? And Yeah. I said and so that so I I'm on the board of directors at the Retirement Industry Trust Association. It's our industry. 

Speaker 0

Okay. 

Speaker 2

So I go to DC, which I'm about to do this week again Okay. For twenty twenty six. Every year I go. And at that particular meeting was the head of enforcement for FINRA. Now FINRA is the enforcement arm of the Securities and Exchange Commission. So if there was a crime, FINRA is SEC crime, FINRA is dealing with it. So I talked to the the head Wow. You know, and I said, I've got this issue. People are coming to me. 

Speaker 0

Yeah. And just just to be clear, you have Yeah. There are seventeen of your clients. Correct? UDirect IRA 

Speaker 2

Mhmm. 

Speaker 0

Investors with capital that are using you, their own money through their uDirect IRA account that invested in a particular with two people that were scammers. Correct? 

Speaker 2

Correct. Yeah. So I said, well, there are these scammers. And so how can these will victims really 

Speaker 0

Right. 

Speaker 2

How can they, you know, be made whole here? What can we do? What what what what's the grievance process? 

Speaker 0

Right. 

Speaker 2

And she says, well, at at the name of the of the institution in California has changed, but it was the California Department of Business Oversight at that time. She says Okay. They have a form, you know, go to the website, give them the link, have them fill out the form, and they did. And then guess what? They reported me. Like like I was at Cahoots. Yeah. Like, well, I'm not, you know? So 

Speaker 0

Right. 

Speaker 2

So here's what happened. So I didn't know this until I get a letter from the California Department of Business Oversight, and it's, you know, like this long. And the guy who signed it was Tim. And so I called Tim. I said, Tim, I received your letter. And he thought I was acting as a broker dealer and affecting transactions. And we don't sell transactions. We don't recommend assets. We don't sell or make any money from assets that our account holders invest in. Okay. 

Speaker 0

Right. Right. So when 

Speaker 2

he thought I was doing that, I said, I I you I understand what you think I'm doing. I'm not. I'll retain counsel. We'll respond. And he treated me like I was like a criminal. It was so like, imagine someone you're looking to like that was horrible. So I was able to retain someone who was actually Tim's former boss. He used to be the head of the California Department of Business Oversight. 

Speaker 0

Wow. 

Speaker 2

That's how that worked out. Like, am I lucky? Yeah. I'm a lucky girl. So that happens. So they get, oh, hey, you know, bro, bro, you know, like this. And and so, but at the same time, he says, look, my attorney says, you know, Karn's retained us. We're gonna review this. We'll respond. So I provided so much data to his to the law firm. 

Speaker 0

Yeah. 

Speaker 2

They we responded and it took forever. But then, eventually, we were told we would never hear back, but we did get a letter from Tim saying, you know, no further questions. And so So I'm like, okay. That's over. Well, then the next thing that happened was I got a letter in the mail. I got audited, like, by the, the the company got audited, and then it turned into a a personal audit too. Wow. Okay. Here you go. Here's my QuickBooks. Here's you know, it's not complicated. 

Speaker 0

And that was likely not a coincidence that they 

Speaker 2

Yeah. Well, I'm sure they all tied together. And and then ultimately, Amanda Hahn from Keystone CPA is my, CPA, and she's amazing. And Yeah. He helped me through the audit, and the auditor told her, the auditor said, tell her she, no further questions. She's getting an a plus on her audit. Like, of course I am because there's nothing to see. So they've seen all my they've seen everything. 

Speaker 0

Right. 

Speaker 2

So so that happened. Then I get a knock on the door basically from the FBI. So the receptionist down at the first floor is like, yeah. Hi, Kaaren. The FBI is downstairs for you with a subpoena. 

Speaker 0

Wow. I cannot imagine. 

Speaker 2

So it was a subpoena for records, but she didn't know that. So I go down my, you know, my father was a policeman. I love law enforcement. In fact, at Rita, they called me the crime fighter, you know, because we've been able to help some people with fraud. So Nice. I go down. I talk to him like, hey. Yeah. Lando, let's crime fight. Let's go. And Yeah. And have a great conversation. That guy ended up being a client of ours after he retired. 

Speaker 0

Wow. That's awesome. 

Speaker 2

So then we provided the records. Those people went to jail. It isn't that's a great story, isn't it? 

Speaker 0

Absolutely. Yeah. And then and then I've mentioned this on other episodes, but I I was a it's still ongoing in the legal system, but I was a victim of a was one of the victims of a massive PPP loan fraud scheme, where just, I can relate on some level where I was getting, e I got letters from the IRS saying I owed a hundred and five thousand dollars. I was getting letters from this lender who I'd never heard of or at least never had any dealings with that I owed, some loan for ninety thousand dollars. And Oh. And all of it, I hit was fraudulent. Someone had, you know, stolen my identity, faked that they were, my, owner of my business, and and, allegedly and and filed fake tax returns and said that I had twelve employees with a payroll of, I can't remember now. 

Speaker 2

So did you know? 

Speaker 0

Seventy five yeah. Exactly. In this one LLC that it actually only had two rental properties in it is what it had in the of mine. But I had allegedly twelve employees making seventy five thousand dollars per month that I hadn't paid payroll taxes for, and then I also had to pay back this loan I had allegedly been given. It's all and so there it's it's you can look it up. It's working. It it working its way through the court system, but I just don't know how people sleep at night doing things like that. But, I mean, it's so stressful when you're it was a lot of stress. I had to close that business, open a new one, and I spent thousands of dollars dealing with this and investigating it myself. And then nothing. I mean, it's just like there's no real recourse. But I'm glad you were cleared, and it sounds like you you then, like, maybe used some of that, pain to to, fight the good fight, so to speak, and then you gotta it sounds like at least one client out of the FBI guy. 

Speaker 2

Well, you know, and and another outcome of it was feeling totally exonerated, you know, just the sense that that our books are great. You know, our our corporate structure is great. Everything we're doing is solid, and it was confirmed by, you know, three government agencies. So Right. That's true. We're and we're in if they're if they're ever gonna check into us, they're gonna have that precedent. 

Speaker 0

That's true. That's a good point. I I did, rearrange some some things on my side too so I was cleaner going forward. Not that there was anything mess super messy, but, yeah, absolutely. And then you just do feel I got I got a letter from the IRS apologizing to me, which I was like, wow. I don't know who else can say that. But Wow. Anyway, episode's not about the episode's not about me. But so walk us through, like, you know, I guess, say, maybe the last five or ten years from a from a business standpoint and then how that relates back to, you and your family, how that related to you from a financial standpoint. What were some of the the successes you've experienced, and how has the business grown over the last few years? 

Speaker 2

Well, over the last, you know, ten years, I think, is is my children growing up, and they see their mom as an entrepreneur, and they see what it took. And they would, go with me to events and work the check-in table or, you know, or or work a booth with me. And so they saw what it was like. And now both my kids are, are public speakers. That's part of their job. My son is in seminary to be a Presbyterian pastor. So he's always public speaking all the time. My daughter works for Lufthansa airlines and she's always, you know, speaking, to her, colleagues. In fact, she's, she's in Florida right now doing that. So, so they learned what it took to be an entrepreneur. They saw me and what it takes. It's not like you just see your parents go to work and you don't know what's happening. I was able to and loved including them in the business. And I recommend that for any parent who can do that, include your children, let them see what, what, what growing up life was like, for, for a while. And it, and it benefited them immensely. And and they understand what hard work it what it is. Yeah. And it's really just showing up every day. It doesn't matter how you feel. You just like my son was in football. Like, you suit up, you show up, you just do your job. So 

Speaker 0

Absolutely. Couldn't agree more. 

Speaker 2

Was, that's a lot about what the last ten years have been like. 

Speaker 0

Yeah. Okay. So, before we get to, more rapid fire questions Mhmm. What's the you know, walk us through kind of the the typical client avatar who you work with. Who who do you work with, and how does it work? I know, you know, there are a lot of people who have money in in other IRAs. I mean, one of the things I didn't know years ago was that, oh, I can I can have two Roth IRAs? You know? I I didn't know that. You know? Yeah. You can't you there are certain rules and certain contribution limits, etcetera. Yes. But I was always thinking, oh, well, I have to either it's either or. Right? I have to close my Vanguard account or, you know, or not open a new one, you know, a self directed account. Well, you 

Speaker 2

can have yeah. There's no limit to how many accounts you can have. There's a contribution limit, but no limit on the amount. 

Speaker 0

I think one of the mental hurdles people might have is that they think, oh, I need to have fifty thousand dollars in cash or or just I'm making up a number, but just to get started with self directed IRA investing. But, no, you can you are already alluded to a rollover or a transfer, two different things. But how how does this whole thing work for somebody who's unfamiliar? Then maybe they wanna invest in real estate or they're already investing in real estate or mortgage notes, but they're not really an expert on self directed IRAs. How does that work for for someone who wants to open an account and never never has? 

Speaker 2

Yeah. I mean, going back to the kind of the beginning of your question is that, like, our avatars, usually it's like fifth forty, I would say, to sixty five. K. And and it could be it's certainly younger. It's certainly older as well. But by the time you're, like, thirty five, forty, you've worked at a couple of jobs. Right. 

Speaker 0

And 

Speaker 2

you started to save in a four zero one ks. So you have enough money to do something. 

Speaker 0

Right. 

Speaker 2

And say, for example, they making a mortgage note. I love that asset class because it's passive. You can have your day job. You don't have to go out there and, you know, deal with tenants or, you know, take off work to deal with that asset class. 

Speaker 0

Right. 

Speaker 2

And and it and it's a slow bake. So that's good too, because you've got you have other things to do. And if you have a secured loan, well, even better if they if they don't pay, then obviously there, it gets complicated, but you might get the asset. You might get the house, the real estate. So that's a great asset class. But of course, so it's first off the avatar for an account holder for you direct to somebody who has saved enough money in a retirement account to put it to work. 

Speaker 0

Okay. 

Speaker 2

Now there are a lot of assets and sometimes notes, of course, that are securities and you have to be an accredited investor, which means you have a certain income, certain net worth. 

Speaker 0

Exactly. 

Speaker 2

So not all assets have that requirement, but some do and some notes do. So basically, so accredited investors, a hundred percent is a perfect match for a self directed IRA. But if you're not accredited, there's so many assets like, like probably smaller notes. 

Speaker 0

Right. 

Speaker 2

And also real estate, but getting into real estate as a fractional owner, like maybe an equity position in someone else's deal. 

Speaker 0

Right. 

Speaker 2

That's possible. Mhmm. Or making a note to someone else's deal is is also right. 

Speaker 0

Hitting her. 

Speaker 2

Yeah. The the like, the assets in self directed hires, cryptocurrency, precious metals Yeah. You know, just so many different kinds of of assets. And Right. 

Speaker 0

So Absolutely. I'm looking for people looking for diversification from the I mean, I I have stocks and bonds. I'm not anti stock market. You know? You you have people on both extremes where the stock market is is a completely, you know, fraudulent rigged system. Well, I don't know. It does does pretty well over time. So Nice. But there's a lot of volatility, and you don't really have a ton of control. You have no control, really. So but, you know, we do we focus on mortgage notes. And and to your point, we have a we have a fund, the Integrity Income Fund. It is for accredited investors, but there are other mortgage note funds that are for nonaccredited investors, regulation a 

Speaker 2

Mhmm. 

Speaker 0

Funds, for example. Ours is a a reg d five zero six c, so we do take only accredited investors. But there are other, you know, regulation d five zero six b, for example, which is for not can be accredited or non accredited investors. 

Speaker 2

Yeah. So first, you can it. Yeah. 

Speaker 0

Exactly. You can invest in a mortgage note fund still or or buy whole notes as you said. And I do love the pairing of of self directed IRA investors with mortgage notes in general because, frankly, mortgage notes offer zero tax benefits in and of themselves where real estate owning real estate typically does. Depreciation is a big one. And we don't have to get into the weeds on UDFI and UBIT. I know you can talk all about that. But for me, pairing mortgage notes and self directed IRA investing, it just it just makes a ton of sense because you do solve that a lot of the tax the the, you know, the issues that that are not inherent, with mortgage notes as far as a tax benefit, by investing through a self directed IRA. So yeah. And and but I just think a lot of people and so there are only a few things a lot of people don't realize all of this. So there are only a few things you asset classes that you can't invest in. Right? We don't have to go super specific here, but what are a couple of those things that you're not allowed to invest in? 

Speaker 2

Life insurance contracts and collectibles. 

Speaker 0

Okay. That's about it. Okay. 

Speaker 2

That's what the IRS is. 

Speaker 0

Alright. Got it. Yeah. It's just you know, a lot of people, like, still think it's like, wait. Is this is this shady? Because it's not a four one it's not stocks and bonds, and it's like, no. I mean, not at all. It's completely above board. And so you direct IRA. Before we get I have, we're gonna get back to your, you know, some, rapid fire questions about you and your story. How is you direct IRA services different from all the other IRA companies out there? 

Speaker 2

We ask ourselves that every day. Like, how can we what's our unique what what's unique about us? And I think, some some of the unique things is that even as large as we are now with one point three billion assets under management, we still have that boutique y feel in the sense that when you call us, you're going to get a person on the phone. You know, you're not going to, you know, you're not going to have to suffer with that. We answer calls, we return calls, and that's a big deal. You know? It seems simple. 

Speaker 0

When you say it, it it should it you know, most people might be like, okay. Good. You should. Right? But it's like Yeah. Unfortunately, that's not always the the norm. So 

Speaker 2

And and also, the speed of getting the assets funded and getting, you know, so that the asset sponsor like yourself, for example, 

Speaker 0

right. 

Speaker 2

You know, you're looking for those, for that capital because you probably have the deadline that you're working with. So getting that, the ask the, funds to the asset sponsor in an expedient manner. 

Speaker 0

Right. 

Speaker 2

But also our fee schedule is is something that I've never changed because Okay. I I think that our investors, our account holders shouldn't be penalized when their account does well. And the way they might be penalized is if they're investing and it's a percentage of assets under management. So the better you do, you know, then the higher your, the more you pay. How does that help you? You know, so we have a flat fee, of two seventy five a year, regardless of the number of assets, regardless of their value paid annually. It's just simple. It's easy. It's you don't have to be you don't have to get a math degree to try to figure out the formula that that the rate the what do you call it? The waterfall there. It's very simple. 

Speaker 0

Okay. What's something you would do differently with with the business if you look as you look back? 

Speaker 2

If there was something I would have done differently, I'd be doing it now. You know, I'm always thinking of it. What could I do? And then I do it. Yeah. I don't I don't think I would do anything differently. I'm really very grateful and happy to be Yeah. At the place where we are now. In fact, I I think I'll mention it this time. One of the great things that happened, another one of the great things that have happened along the way is I got to write this book. 

Speaker 0

Yeah. Talk about that. 

Speaker 2

Yeah. So I partnered with BiggerPockets to write the BiggerPockets Guide to Self Directed IRA Investing. And, you know, just this was so wonderful. And being I've been able to, I've spoken at BiggerPockets twenty two, twenty three, twenty four, twenty five. I was there, you know, signing the books as an author. And and so, so this has been it's been wonderful. The people there are great. And the experience of of their editing staff working with them was so fun and, because I'd given them the transcript years before. And then in September of last year, they called me up and they said, okay. We want the book by November. Like, okay. 

Speaker 0

Wow. 

Speaker 2

Two months. Rewrite this thing. 

Speaker 0

Go. Wow. 

Speaker 2

So I was in here on the weekends and, you know, over time and everything, but it was fun. And and to get it done was very satisfying. Yeah. And it was a collaboration. We we did it together. 

Speaker 0

So Okay. Yeah. That's a I mean, it is a ton of work for sure. People don't realize how much work goes into writing a book. So congrats on that. That's fantastic. And it before we hop to the rapid fire questions, just you mentioned it earlier, but what are the type of accounts that people can open in in general, with a self directed we always say self directed IRA, but Yes. They're not all IRAs. Right? What what types of accounts are we really talking about? 

Speaker 2

Well, the other thing is people say, well, this is a self directed IRA, but I but I want a Roth IRA. And they don't understand that they're one and the same. 

Speaker 0

Right. 

Speaker 2

So if it's if it's one of these accounts I'm going to mention Yeah. You can have them in the tip with typical assets, or you can have them self directed either way. Okay. Got it. The traditional IRA, ninety percent of our accounts are the traditional IRA. 

Speaker 0

K. 

Speaker 2

Where the money comes in, you may get a tax break. Right? 

Speaker 0

Right. It's pre pretax money that goes in. Tax deferred growth, I believe. 

Speaker 2

A hundred percent. Yeah. And then the Roth, you know, that's different. That's the money comes in. You pay tax, but it grows tax free. 

Speaker 0

Right. Exactly. Okay. So traditional and Roth are the the big ones, it sounds like. And 

Speaker 2

They are. And then the next in line would be the SEP, which is an acronym for the simplified employee pension. What it is is it's it's like, it, it, it's, it's, it's on the chassis of a, of a traditional IRA, but it's bigger. So it's for self employed people and their employees. Okay. This is an IRA for it. That's why it's a simplified employee pension. So you, the contribution limit for this thing is up to seventy two thousand dollars That's the cap. So it's a lesser of twenty five percent of the income up to a cap of seventy two thousand dollars So that is really, and add to that, why the SEP is so great is that you can also now, thanks to Secure Act two point o, make that contribution Roth. Wow. People don't know that. 

Speaker 0

I I yeah. I didn't realize that. 

Speaker 2

That's The IRS hasn't given us a lot of guidance, but it passed as law. Okay. You know, December thirty first twenty twenty two that you can do that. So you can do that. And there's more. The simple IRA, which people don't usually use because it's outshone by everything else. Gotcha. The solo four zero one k, which is you have a four zero one k work, you know what a four zero one k is. 

Speaker 0

This is 

Speaker 2

just a four zero one k for either a single employee or, like, if if a married couple and they're both owners, it could be for the married couple. But it's the plan is one thing. Okay. The plan is one thing. And then the participants like say husband and wife or just the single participant. So the plan is one portion. The participant is another portion. So there are two sets of rules, the, the, the participant rules, the plan rules. Yeah. But then, again, you can take a personal loan from that. There is a Roth bucket with that, and so it it does have a lot of bells and whistles. 

Speaker 0

Gotcha. And with the the bigger the bigger ones like a traditional or Roth, you work with people who do both, the checkbook IRAs as well where where they're managing everything and it's owned by an LLC. 

Speaker 2

Yeah. Well, I think we should talk about that. Yeah. It's a misnomer to call it a checkbook IRA. 

Speaker 0

Yeah. I've heard that too, but people call it that. 

Speaker 2

You go to irs dot gov and you say checkbook IRA, and they're like, there's no such thing. 

Speaker 0

Right. 

Speaker 2

So it's like it's like this is not this is called Kleenex. Oh, it actually is Kleenex. You know what I mean? It could just be facial tissue. 

Speaker 0

Tissues. Right. 

Speaker 2

Right. Tissues. Sure. Alright. So that that that's what we're talking about with the IRA owned LLC. That's a correct way to 

Speaker 0

owned LLC. That's the way to put it. Okay. 

Speaker 2

And any of these accounts can have an IRA owned LLC. 

Speaker 0

Okay. 

Speaker 2

It's an asset of the plan. 

Speaker 0

Got it. Okay. No. That's a simple way to put it. Awesome. Alright, Kaaren. You ready for the rapid fire questions? 

Speaker 2

Let's go. 

Speaker 0

This one does trip people up sometimes. What's one thing that people misunderstand about you? 

Speaker 2

I don't know. 

Speaker 0

Told you. 

Speaker 2

Oh, yeah. I mean, what do people misunderstand about me? I don't I don't know. I think, I am I misunderstood? I mean, maybe by my kids because they think I don't know anything. Like, oh, mom. Right. Yeah. You get one of these, like, alright. When you're my age, you'll 

Speaker 0

Yeah. You'll understand. 

Speaker 2

Oh, that's what she meant. So if I'm misunderstood, it's by my grandchildren. 

Speaker 0

That's good. If you could go back and give your eighteen year old self some advice, what would that be? 

Speaker 2

Oh, I give myself the same advice today. Don't worry. It works out. 

Speaker 0

Love that. Yeah. That's great. If you were given ten million dollars yourself personally 

Speaker 2

Mhmm. 

Speaker 0

Tomorrow, what would you do with it? 

Speaker 2

Buy real estate. 

Speaker 0

Okay. 

Speaker 2

Notice how I hesitated when I said that. 

Speaker 0

Yeah. Yeah. 

Speaker 2

And that's what I do. That's with the with the, you know, the money my with my income. That's what I do. I invest in real estate. 

Speaker 0

Okay. What what do you what do you say? Like, residential? What kind of real estate do you invest in? 

Speaker 2

Yeah. I mean, I'm I I make notes to people. 

Speaker 0

K. 

Speaker 2

And I and I'm I'm a note investor, definitely. And I I've invested in some properties with operators who I know from being in this industry. 

Speaker 0

That's the key. And and 

Speaker 2

a lot of times, it's single family homes. Yeah. And so, personally, I have some single family homes as rental properties with renters. And it turns out that they're great renters, and it hasn't been a major nightmare. So 

Speaker 0

No. I I'm with you. I have some rental properties, and I I like them. 

Speaker 2

And, you know, I got to tell you another another asset class. I'm all at the at the conference that I'm about to go to, the Rita conference. We have somebody from Delaware depository there, and they call me a silver stacker because I've been buying silver coins since they were thirteen dollars amount. 

Speaker 0

Oh, wow. And 

Speaker 2

Today, they're eighty. I looked it 

Speaker 0

up. Wow. 

Speaker 2

So I'm also a silver stacker. 

Speaker 0

Nice. Yeah. Genius. What's the challenge that you're facing in your business right now? 

Speaker 2

Social media advertising, you know, Internet marketing 

Speaker 0

Yeah. 

Speaker 2

Is a challenge. I hired an agency. Mhmm. And I'm like, this just doesn't seem right, but it this is not an area that I've studied. And so we hired a consultant to come in and, like, I don't know what I don't know. Right? 

Speaker 0

Right. 

Speaker 2

So I brought in a consultant to say, hey. What's going on? And we kind of, you know, shaken the agency, waking them up. Like, wait a minute. Look over here. 

Speaker 0

Right. 

Speaker 2

And, you know, the Co operation unit is over tribulating over here. You know? I don't know what I'm saying, but but they do. And, so and just to like, oh, oh, you're right. And because they're kind of asleep at the wheel, they do their job every day. They're not really noticing. So I hired a consultant to shake them up and and move things so that the social media is, marketing is is more effective. 

Speaker 0

Right. Gotcha. That makes sense. You mentioned at least one book, maybe two, but what's a book that you could recommend for our listeners? 

Speaker 2

One book I recommend to everyone, I mean, that I gave to my kids when they were still in junior high is Think and Grow Rich by Napoleon Hill. 

Speaker 0

Gotcha. 

Speaker 2

It's just it's the bedrock of of, you know, it's, you know, things about masterminds and how powerful a mastermind is and, you know, and positive intentions. And it just it says it all. So I recommend if before you read anything, read read Think and Grow Rich. Also, The Richest Man in Babylon. It's almost like a children's book in a way. It's so simple, but it's the same. It talks about money and how to understand money. 

Speaker 0

Speaking of money, how has financial abundance made your life better? We touched on it a little bit, but what has it done for you, you know, today? 

Speaker 2

That's funny. You know, I used to think, well, I'm the CEO. I'm gonna walk in like Sigourney Weaver in nine to five. You know? Like, with my champagne and, like, no. No. No. It's it's it I mean, it's I just I I I work harder, but I want to. Mhmm. You know? Yeah. I'm not looking at the clock. I'm like, oh, it's almost five. I get to go home. I don't even think that. It's like, oh, hey. Oh, look. It's, you know, six PM. I I probably should go home. 

Speaker 0

I should go home. 

Speaker 2

But I just love what I do, and so I think that, I have more frequent flyer miles. So I get to Paris. 

Speaker 0

Yeah. There you go. Right. 

Speaker 2

That's good. But, you know, I mean, I don't 

Speaker 0

Yeah. 

Speaker 2

I mean, if that's somebody else, I don't think I'm that different. 

Speaker 0

Yeah. Okay. Fantastic. What's one question, Kaaren, that I that I have not asked that you wish I had? 

Speaker 2

No. You've been very thorough. I'm I I think you've left no stone unturned here. But Alright. Just to say, you know, you've you've said it. You've said it. So I don't I couldn't 

Speaker 0

ask that. Well, for our listeners, any final thoughts if there if if there maybe it's a single mom going through a divorce or, you know, maybe it's someone thinking about starting a business. Not that there's a one size fits all answer or anything, but any words of encouragement or guidance for our listeners? 

Speaker 2

Yeah. I mean, don't give up. You know? Don't give up. And just and just keep pushing because, you will solve the problem or you'll be redirected into another area. Like, I was really I was really trying to do this. I just kept meeting brick brick walls. It's like there's a reason. But in the process of hitting all those brick walls, you found something else and you went over here. 

Speaker 0

Sure. 

Speaker 2

So as long as you get up every day, it's easy to get depressed when you can't see a positive future. Forget about it. Just just don't listen to that voice. Get up and and get dressed anyway. 

Speaker 0

Right. 

Speaker 2

And do something that makes you happy. Go get it. Go get it. You know, go get your Starbucks and write your name like happy Tuesday on your cup. Nice. You know? 

Speaker 0

And and 

Speaker 2

just try to find people that who encourage you and and support you. 

Speaker 0

Yeah. Who you surround yourself with is critical. Yeah. Awesome. Well, Kaaren, thank you so much for joining us. Where can our listeners find you online? 

Speaker 2

Everywhere. You know? 

Speaker 0

Okay. You are out there. 

Speaker 2

We're TikTok, Instagram, you know, we're Facebook, we're LinkedIn, every everywhere. Our website is the letter u, u direct I r a dot com. U direct with a u like U Haul. Because think about this. If we've got we've got, like, a minute here. So U Haul, what is a U Haul? Do they pack the van for you? No. They just give it to you. That's what that's what a self directed IRA is. We give you this account. 

Speaker 0

Okay. 

Speaker 2

And you put the asset in there. We don't tell you what to put in it. They don't tell you what to move. Right. And then do we come to your house and move all your furniture? No. Do we come to your house and tell you what to invest in? No. You figure it all out. And when you're done, you know, you give it back to us. So it's some it's very similar. So it's you little you like U Haul, you direct IRA services. 

Speaker 0

Makes sense. Awesome. Well, thanks again, Kaaren. Really appreciate your time. 

Speaker 2

Thank you, Jamie. 

Speaker 0

And to the listener, thank you for spending your most valuable resource with us. That and that is your time. Thanks, everyone. Take care. 

Speaker 1

Thank you for joining us on From Adversity to Abundance. We hope today's episode has equipped you with valuable insights and practical advice to elevate your real estate journey. For more inspiring stories and resources, visit us at w w w dot adversity to abundance dot com. If this episode has inspired you, please share it with a friend who could also benefit from our conversation. Together, let's turn adversity into abundance. Until next time, keep building your mental fitness and your real estate empire.