Hello Rogue Investors,

Welcome to Day 6 of 7 Days of Thanks

7 Investment and Tax Strategies for 2010

1. Set Up a Self-Directed Roth IRA, 401(k) or TFSA Account. If you live in the States, don’t forget to open your Roth IRA account and fund it at a minimum of $5000 for 2009 and 2010. Remember, if you invest in a Roth IRA, your capital gain or earned income will be tax free, meaning that if you invested $5000 in a tax deed in Texas and it was redeemed and you earned 25%, you will not be taxed on the $1250 earned; in fact, if that same tax deed was not redeemed and you sold it for $50000, you would not be taxed on the entire gain of $45000. Canadians now have a very similar investing option, known as a Tax-Free Savings Account. Qualified retirement plans or individual 401(k) plans allow you even more flexibility. You can set aside up to $49,000. You can borrow up to 50% (or whatever the plan calls for) against the 401(k) contributions. You can even set up a plan so that you are the administrator. If you are interested in using one of these plans, contact me and I will refer you to an expert that I have worked with.

2. Estate Tax. The good news is if you die in 2010, your estate will not be hit with the estate tax, even at the generous 2009 exemption of $3.5 million. The bad news is if you plan on living past 2010, the law will revert back to 2001 levels of a $1 million exemption with a potential 55% tax. Who would have thought that political maneuvering could make 2010 the best year to pass away in some time? What a morbid system we have. It brings back the idea of nothing being certain except death and taxes.

3. Tax Credits. If you are a first time homeowner, you may qualify for an $8000 credit. If you’ve owned your existing home for at least 5 years and you buy another home, you may qualify for a $6500 tax credit. Don’t forget, if you upgraded your heater or air conditioner, added insulation or spent money on reducing your energy outgo, you may be eligible for a 30% tax credit, up to $1500.

4. Foreclosures. Right now not many investments can beat foreclosures. When you find the right place to invest, your cash on cash returns can exceed 30%. Our 10-10-10 Foreclosure investors are purchasing houses for $8000 to $19000, and even after expenses and time to find a renter, they are earning in the range of $600 to $900 per month. Assuming two months of down time, insurance, taxes and rehab, a total purchase of $20000 is common. At $750 over 10 months and $250 per month subtracted for expenses, which is a conservative estimate, the cash on cash return is $5000/$20000 (25%) in income and factoring in appreciation at only 5%, you have a 30% return.

5. Tax Lien Certificates. Nothing is much easier and safer than purchasing debt on real estate and waiting for a check in the mail. At 8% to 36% on an annual basis, you could do much worse. It may not be sexy and exciting, but who cares. I would like a little less excitement sometimes. How about you?

6. International Markets. In 2008, the last year of full record, the real growth in many countries was

astounding. While the United States, Canada and Europe grew at an anemic pace of around 1% or less, some countries were exploding. We all expect to hear about China and India. And in fact, China grew at 9.0% and India grew at a rate of 7.4%. However, here are some surprises that may intrigue you: Panama grew at a faster rate than China (9.2%). Vietnam and Indonesia grew at about 6%. Russia grew at 5.6%. Even my home away from home, the Dominican Republic, grew at 5.3%. These growth rates occurred during the heart of a global recession. It may pay to diversify outside of Europe or North America.

7.  Pay Down Debt. One of the best returns you could ever hope to achieve is paying down debt. Whether it is your car, house or credit card, debt makes someone else money, not you. When you pay down debt you are not losing money; instead, you are earning returns ranging from 5% to 24% or more.

All the best,

Michael Williams

1-913-381-4520

P.S. Stay tuned for the final day of thanks…