Investing in retirement notes can be an important tool in your retirement planning. Investments in notes have been around for a long, long time. In fact, investing in notes existed long before banks were invented.

Before banks were invented, if a trader or farmer wanted to sell his asset or product, he had to be paid in full in cash, or the buyer had to pay with a combination of cash and the buyer’s promise to pay. the balance afterwards. Before banks were invented, IOUs were accepted in payment for assets by private merchants, private farmers, and private investors.

Today, banks handle most of the promissory note business. But they don’t handle it all, they don’t handle it 100%. Private party notes are still used in specific business and financial transactions. Some examples of private party note financing that are commonly used today are:

  • a house transaction
  • A farm or ranch transaction
  • A sale of a business transaction
  • A Divorce Property Agreement
  • A dissolution of partnership ownership

All of these transactions offer potentially above-average investment opportunities, if properly structured. They can offer a monthly cash flow that is above what is available from other sources. They may offer short-term earnings opportunities or long-term retirement investment opportunities. They may offer a higher-than-average interest rate return. Essentially, each private party note can be tailored to fit special and specific situations, if they are properly structured.

In order for you to benefit from this area of ​​self-directed retirement investing, you must “do your homework.”

To the best of your ability, determine the following facts that apply to your personal situation:

  • How much cash do you have now to invest in retirement?
  • How much cash will you have in the future to invest in retirement?
  • When will future cash be available to invest in retirement?
  • Do you have a target amount of retirement income?
  • Do you want to be an active investor or a passive investor?
  • Want to get involved in investment classes and training?
  • How much risk and volatility are you comfortable with?
  • Do you want to invest alone or with one or more partners?
  • Do you have investment experience?

Think long and hard about each of the above questions. Take your time and really “get acquainted” with your investing self. Do not rush into any investment until you have answered these questions truthfully and honestly. In investing, as in many other areas, “hast wastes.”

You have to learn to crawl before you can walk; walk before you can jog; jog before you can run.

Your goal should be to gradually, over time, secure a steady monthly cash income so you can live when full-time or even part-time employment isn’t an option. Your long-term goal should be “financial freedom.”

A note of caution: Eighty to ninety percent of people believe they are above average. Assume that you are fallible. Be careful!

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