Understanding Rollovers for Business Startups With Frank Selden
Frank Selden is a tax attorney. He’s the founder of 401k ROBS Pros. He’s one of the foremost experts in the country on Rollover Business Startups, which is what ROBS’s stands for. He’s helped thousands of people find the right funding to start their businesses. His desire to help people comes from a passion to make a positive difference. He was a member of the Army National Guard and he provided relief to those in need. As a personal banker, a loan officer, he aided people in sound investment strategies. As a tax attorney, he has advised people on legal ways to protect their assets. And now as a ROB’s provider, he helps entrepreneurs fund their business ideas with qualified retirement plans tax-free.
Frank grew up in a Dutch Dairy Farm Community where spent most of his life until his early 30s. He didn’t really like it very much so he decided to go off in a different direction. He joined the Army National Guard and became a bank officer with a bank in the Pacific Northwest in Watkin County where most of my family is, and really enjoyed the banking career and tell it went through a reorg shuffle where I didn’t lose my job, but they basically took all the fun out of it. And a lot of the commission’s so I was making a lot less money, I kept the same title. But most of my authority was gone. And I decided I didn’t want to play that game anymore. And at the age of 40, I went to law school, use my experience in banking to essentially get involved in self-directed IRAs and rollover business startups right from the very beginning right after law school, and I’ve been doing that ever since.
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Brett:
I’m excited about our next guest. He is a tax attorney. He’s the founder of 401k ROBS Pros. He’s one of the foremost experts in the country on Rollover Business Startups, which is what ROBS’s stands for. He’s helped thousands of people find the right funding to start their businesses. His desire to help people comes from a passion to make a positive difference. He was a member of the Army National Guard and he provided relief to those in need. As a personal banker, a loan officer, he aided people in sound investment strategies. As a tax attorney, he has advised people on legal ways to protect their assets. And now as a ROB’s provider, he helps entrepreneurs fund their business ideas with qualified retirement plans tax-free, which is our favorite phrase, please welcome to the show with me, Frank Selden. Hey, Frank, how are you doing today, sir?
Frank:
Doing very well. Thank you, Brett. Appreciate you having me on the show.
Brett:
Absolutely. For our listeners to get to know for the first time, would you give us a little bit more about your story and your current focus?
Frank:
Grew up in a Dutch Dairy Farm Community. So I spent most of my life until my early 30s, actually, around that community. And then actually admitted to my family, I didn’t really like cows very much. So I decided to go off in a different direction. I joined the Army National Guard and I also became a bank officer with a bank in the Pacific Northwest in Watkin County where most of my family is, and really enjoyed the banking career and tell it went through a reorg shuffle where I didn’t lose my job, but they basically took all the fun out of it. And a lot of the commission’s so I was making a lot less money, I kept the same title. But most of my authority was gone. And I decided I didn’t want to play that game anymore. And at the age of 40, I went to law school, use my experience in banking to essentially get involved in self-directed IRAs and rollover business startups right from the very beginning right after law school, and I’ve been doing that ever since.
Brett:
Amazing. Looking forward to dive into a little bit more about what you learned over the years. But by the way, you can learn more about Frank Selden at 401krobspros.com. But before we go there, Frank, people call you Rob all the time, right?
Frank:
Amongst other things, yes. One of the very few people I’ve talked to, by the way, Brett, whoever says that tax attorneys are some of their favorite people.
Brett:
Yeah, no, these are from the smartest, coolest people ever. I really, they really are. So yeah, so Frank, I want to take our listeners to go back before your career days, I wanna go back to the high school at the University days, maybe the dairy farm days, you’re on the dairy, and mom and dad are our you know, hopefully speaking life into you and talking about your gifts and talents they believe you’ve been given. And so I think we’ve all been given certain gifts and these gifts were given to us to be a blessing and help to others. Some people call them strengths, some people call them superpowers, I’m curious about one or two gifts that you believe you are given, and how does that help how you help him bless people today?
Frank:
That is such an awesome question. What immediately comes to mind is a meeting I had at a conference one time I was actually learning how to talk to people. I wasn’t very good at that. Communicating with cows and talking to people is a different skill. I joined Toastmasters as a member for quite a few years love that organization. That is a Toastmaster conference where the speaker encouraged all of us to chat with our neighbors for a few minutes and just get to know them. So we would say things like hi, how are you today and just break the ice and come up with something at the end of that conference. One of the people that I had talked to came up to me afterward and said there was something different about me that when I asked her, how are you? It felt like I really wanted to know the answer. That stumped me in some sense because I thought everybody did. Why would they ask that question if they don’t really want to know the answer? The reality is that most people don’t. When they ask questions like that, I think that my gift is that I really do care. I do want to know the answer. And that comes into how even we create rollover business startups for people. We do not create a custom cookie-cutter approach for lack of a better term, like some of the rubs and motion companies, we actually listen, we care what the answers are. And we create custom solutions for each one of our clients in an industry where that is not known. So, I think you’re exactly right, that gift or that, and I don’t really think of it as a gift. It’s just part of who I am. It’s part of what makes me, but it’s also part of our company.
Brett:
Absolutely love it, the deep care and empathy for people and actually caring and listening. Well, is that a fair summary?
Frank:
Yes. And sometimes it sucks, by the way. Sometimes caring sucks, and it hurts. And you know, but that’s the ups and downs of life. And it’s not like I can turn this off. It’s their weather. Sometimes I’ve actually thought, No, this isn’t a gift. It’s a curse. So yelling in old Greek fashion up the mountain tops of the at the gods who might curse humans with these kinds of things. But it really is a gift. And I really appreciate you both reminded me of that. And you know, bringing that to light, it is a gift, when I think of it that way. Use it that way. It certainly can be and it is part of whatever into the world. It’s part of me.
Brett:
Love it. Frank, thank you so much for sharing that it means a lot to me. And I know my listeners as well. So now let’s dive into some strategies here to use your 401k or IRA to finance your business, your own business. So what’s the biggest secret Frank when it comes to using your 401k or an IRA, to finance your own business?
Frank:
The secret of the IRS one is to get it right according to the rules. One may not, for example, invest their IRA directly into their own business. We can use IRAs IRA funds in this strategy. But what it requires is a creation of a corporation. If a client has a corporation already, we can use it, that corporation is going to sponsor a 401k plan for the benefit of all of its employees. The client is going to be an employee of that Corporation, they are allowed to be the only employee, they then have a right to transfer those qualified funds into this new 401k plan, which must be properly crafted to allow the plan to invest into the stock of the sponsor and employer, even though that stock is not publicly traded. So that’s essentially what we’re creating for people as a mechanism through which they can then transfer the qualified funds into the plan then invested from the plan into the Corporation for stock. The plan then owns that stock, not individuals themselves, as is proper for any plan investment that is continuing to grow for them in a tax-deferred status. And we can get into what happens with capital gains or investment income or dividends and things like that related to the plan investment. But that’s essentially the strategy Corporation 401k plan invested into the company for stock the corporation is then allowed to use those funds for whatever corporations are allowed to use the money for our existence, buy a franchise, start a restaurant, whatever.
Brett:
Excellent. And what’s the best secret for the client? What’s the outcome for them? Why would somebody want to do this versus just you know, getting financing and raising funds in a different way?
Frank:
The top two reasons I believe that people want to do a ROB strategy number one is because they really don’t have anything else available to them. Sometimes funding it’s a little hard to get maybe their credit isn’t where they want it to be. Or they don’t want to burden their business with loan payments right off the bat. So they want to do a cash investment to get their business up and running. They only need whatever we do deals as low as like 50,234, sometimes all the way up to a million, but they want to make this cash investment they want to start a court company off without having to make payments. But there are only two places they have cash one is in their house. So they could get a second something like that, which is again creating the debt or they have it in their retirement plans, but they do not want to take a taxable distribution out of their plan in order to fund their business. And this way that’s growing tax-deferred.
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