INTERVIEW WITH DMITRIY FOMICHENKO LINDA PLIAGAS
How has the Solo 401k revolutionized selfdirection?
A Solo 401k (also known as Individual 401k or
Owner-Only 401k) is a simplified version of the
401k Plan, and is designed for sole-proprietors or
small business owners who don't employ full time
workers. Most investors qualify for it, even if they
Over the next several years, I realized that
have a full time W2 job working for a company. All
conventional investments such as the stock market
that is needed is the presence of self-employment
and mutual funds were very unpredictable. At the
activity, which could include consulting, network
same time, my real estate investment portfolio was
marketing, a referral business, etc.
growing rapidly. I made a number of mistakes and
estate investors that manage their own properties
lost money on some of my real estate deals, but
use this activity to qualify.
Many real
overall, my returns were significantly better than
that of the stock market.
I wasn't comfortable
The reason a Solo 401k is so attractive is because
recommending conventional investments to my
of its unique features and benefits, not found in a
clients and started devoting more of my focus to
self- directed IRA. Here are few:
real estate.
In 2004 I went to work full time for a real estate
Loan
Provisions
Roth
Sub-Account
investment firm and started teaching my clients
how to invest in real estate. I soon received offers
to teach classes in real estate investing at several
local community colleges.
Over the years, I
Exempt
from
UBIT
mentored hundreds of investors and instructed
Solo
401K
over one hundred classes/seminars.
One thing I heard from my clients was that while
Checkbook
Control
High Contribution
Limit
their real estate portfolio was growing, their
retirement account was losing its value in the stock
Loan Provision: The Solo 401k Plan also contains
market. I had heard that it was possible to invest
a provision which allows the participant to borrow
in real estate using an IRA or 401k, so over the
from the account at any time and for any purpose.
next year, I researched how to invest in self-
A Solo 401k loan can be made for up to 50% of the
directed IRAs and 401ks, and consulted with the
account or $50,000, whichever is less.
top experts in the field.
loans can be used for any purpose.
Financial was born.
That is how Sense
These