Brett Swarts is a Deferred Sales Trust™ Trustee, DST expert, capital gains tax deferral expert, investment real estate expert, multifamily broker, and the founder of Capital Gains Tax Solutions – a company helping individuals to defer capital gains tax on the sale of their highly appreciated assets, eliminate the need for a 1031 exchange, and unlock transformational wealth building options so they can create & preserve more wealth. He created ‘Capital Gains Tax Solutions‘ to equip high net worth individuals and their trusted advisors with the Deferred Sales Trust™ tool to help them solve capital gains tax deferral limitations.
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Billy:
Hi, I’m Billy Keels, the host of the going long podcast. Every week, I will be here interviewing the absolute best in the business regarding real asset investing and real mainstream investors. We’re going to be having conversations where you can listen in. And that will help you continue on your education path to feel much more comfortable and confident and invest long distance. So make sure that you go ahead and subscribe to the channel and that you like it as well because that way, you can get every single episode as soon as it comes out. And by the way, remember to leave today’s episode of five-star review. Let’s go ahead and listen to today’s conversation. Welcome to the going long podcast. And we’re back again to continue to help educate us so that you feel more comfortable and confident investing beyond your backyard.
I’m your host, Billy Keels. And, you know, if you’ve ever wanted to escape the feeling of being a hostage to the 1031 exchange or even paying up to 50% in capital gains taxes, guess what? You’ll want to listen to every word of today’s conversation. Because today’s guest is not only an entrepreneur, an investor, and an expert in the world of deferred sales trust trusts. He has also served millions on lots of billionaires. He’s also done doctors, lawyers, and high-paid professionals. He’s also the host of the capital gains tax solution podcast and the founder of capital gains tax solutions. Like to welcome you to the show, Brett Swarts. Brett, welcome to show man,
Brett:
Billy, I’m excited to be here to add value to you and your audience. Hey, man, this
Billy:
It is going to be excellent. And already knowing that you have been on this side of the pond and have some great places that you’re thinking about, and you’re on the Left Coast of the United States. This is going to be an excellent conversation. So, Brett, I like to ask everybody the same five questions. We’ll start with two at the beginning and three at the end. And the very first one is where you live in the United States.
Brett:
I live in a place called Northern California near Silicon Valley. I grew up in the Bay Area, and what is also known as my particular place is called Roseville and Sacramento. It’s about an hour and 30 minutes from San Francisco. So it’s a beautiful place, the foothills. It’s about an hour and a half also from what’s called Lake Tahoe, which is a world-renowned mount mountainous region. Beautiful lake. The fantastic scheme they had with the Olympics. There, I believe in, I don’t know, 2030 years ago, in Squaw Valley, you know, which was pretty amazing, too. So it’s a beautiful place, and it’s wireless.
Billy:
Awesome. That’s one of the towns that I will be visiting sometime soon. And the first place I ever went skiing was in South Lake Tahoe. So a place that I know, I know. Well, I had a good time. Listen, so so great. You’re in Roseville. But what is the most positive thing that’s happened to you in the last 24 hours?
Brett:
Yeah, so I spend time with my family, you know, after a fantastic podcast interview, sometimes as a podcast, so you don’t know the guests that you’re going to have on and email I have my booking agent book, folks. And I was utterly blown away by this guest that I had, so much so that I subscribed to his YouTube channel, Master Talk. And it’d be suitable for anyone listening just with communication, sales, consulting, or podcasters, disguising his Britain, Cuba, sorry, he’s got a Montreal. Just my mind was just blown. Like I was one of those moments where I was just tired, racing for the day to end. And this is my last podcast of the day. I did. Tuesdays are my days where I’m just batching multiple podcasts in a row, and I need to figure it out. And I’m trying to look at this stuff at the very end. And I’m just like one of those. I’m like, Oh my gosh, this is like, you know, transformational type of communication coaching that he does. And so I subscribed to this podcast, and then I went to go for a run. And my daughter came with me to the park, and I got to work out and relax a little bit. That was the most positive part of the last 24 hours.
Billy:
Yeah, thanks. Yeah, it’s 100% work. 100% joy, especially when they’re at younger ages. And my wife’s a rock star there. And, yeah, we’re blessed to have multiple kids. And it’s, it’s, it’s impressive.
Brett:
Yeah, fantastic. So, listen, you know, I gave a couple of highlights, Brett, and talked about some of the things just really quickly, but I would love for you to share with the going audience kind of what are some of the different decisions that you made in your life to get you to this point in your journey?
Billy:
Yeah, great question. So, you know, growing up, I love playing sports. I love working on teams. Loves competition and love learning. And I was always curious about subjects I liked; I dove into stuff I didn’t like and needed to be more excited about. So it helped me in my journey to get mentors and a good partner with or work for or with those ahead of me. And that allowed me to grow and to learn. And I’ve always been the tortoise versus the hare Billy, right? It takes a little while to get it. But once I get it, I, I tend to, you know, take it maybe to the next level and try to, you know, really make an impact for others using, you know, different strategies we’re going to talk about, or even in sports, you know, I was, I was a six-foot white guy who could shoot and play basketball, right, I was able to get a scholarship and play and maximizing my potential is kind of, I was the younger brother of my older brother, then also the most immature kind of or the most youthful of like nine cousins. And so I always had folks ahead of me that I could learn from; take me a little while to get it. But once I get it, I approve of it and maximize the potential of whatever it is, if that makes sense.
Billy:
Yeah, it makes sense. And I can relate to you a lot in that it takes me a little time to get it. But usually, once I do that, go well. But you’re humble because if everything is correct, you were also the basketball team’s captain. Is that correct?
Brett:
Yeah, I was. Yeah, I was in a small new school. But we beat UC Davis that year, who went to the NCAA Tournament a couple of years ago. But this is like, this is back in like 2000, like seven. Right? And so they weren’t going to be, as you know, as good as they are now. But that’s pretty sweet. You see, it’s pretty fun. And growing up and getting a scholarship to play basketball, I was the team’s captain, which was fantastic.
Billy:
Yeah, that’s phenomenal. And also, we’ll see a lot of how that leadership plays out and even many things that you’re doing today. So I appreciate you helping us to get an understanding of some of the things that you’ve done up until now. But, because you are the first person that will help us understand this world that many people don’t understand. And one of the things that I would love for you to talk about is the basics. When we think about something like a 1031 exchange, can you help people understand exactly what that is and why that’s important, especially from a tax perspective, and then we can build from there?
Brett:
Absolutely. So most high-net-worth individuals who own investments, or real estate, struggle with capital gains tax when selling. And so the 1031 exchange allows you to sell an asset, real estate property, and 1031 into or trade it, if you will, into a lifetime investment property, deferring the tax and the tax depending on your living state. And depending on how long you’ve owned it and how much depreciation you received, it can be somewhere; it could be as much as 30 to 50% of your gain. And so the critical part is to use the time value of money; instead of paying that tax, you can defer it by a legal tax incentive that the IRS allows you to do via section 1031 of the tax code. And so you’re just taking your equity, let’s say you own a property for a million bucks, it’s worth 3 million, instead of just selling and paying the tax on that $2 million gain, you can sell it, and you can roll it all into the next property and keep all of that wealth building for you.
Billy:
So that is phenomenal. So you’ve helped us understand. This is really about a tax deferral strategy and 1031. Please tell us a little bit about some of those parameters. And two things. Number one, you were talking about real estate. Would that also include things like businesses outside of real estate?
Brett:
Yeah, so great question. So although I attend 31 could work for a business, I’ve never seen someone practically use one because most folks who have highly appreciated enterprises are not looking to go in and sell a high and roll it into another business. After all, it’s such a hands-on type of thing. In comparison, real estate is where it’s more used. So technically, Yes, for businesses, but it has to be like-kind of companies, whereas real estate is like a kind of real estate that can be more passive. The biggest thing about the 1031 exchange is that it’s like the blockbuster. It’s a way that gives you some tax deferral. But it’s it can be a big, big challenge. So perhaps we can touch on that,
Billy:
Please expand because this is a little about some parameters you must abide by to utilize it in 31. And then, from there, I’d love to get into the world of DST, but let’s start there.
Brett:
Yeah, great question. So so, I don’t remember getting married, Billy, but I got married, you know, I had a chance to get to know my wife in high school, and then we were friends for a while, and then we were able to, you know, date in college for another four years and then have an engagement and get married. We spent a long time getting to know each other and establishing that foundation. Well, the blockbuster or the temporary one is like a blockbuster and a shotgun wedding. And this is the biggest thing that is painful for many of our clients. You see, in 2006 and five, when I was just getting started in real estate, many clients were buying real estate. And we’re overpaying for real estate via the 1031 exchange because of a 45-day window to identify and 180 days to close. And we call this the shotgun wedding; you get engaged in 45 days and have to get married within 180 days. So you have to follow these rules. If you miss these rules, the whole thing fails, and you pay the tax. And so, in 1031, our parents taught us to sell high and buy low, not sell high. And, my higher 180 days later, and that’s, unfortunately, what 1031 kind of forces you to do. And that’s like blockbuster to always tie that in here. So I don’t remember going to a blockbuster. And he would show up on a Friday night, and you see that movie, and that movie was behind that, you know, that cardboard, and you’re all excited to get that movie. But as you walk there, someone’s about two or three steps ahead of you. And they look at you, smile, and go that same movie you’re about to get right. Oh my gosh, that’s a bummer that is sold out. I got to settle for my second thing, or it’s incredible. I even got the movie. That’s cool. But then you have three days to return it. And if you don’t return it, you get a penalty. Right? Yeah. And then, if you forgot to rewind it, you get a penalty? Well, that’s like 1031; it’s very restrictive; you have to do equal or more excellent value, which is the second rule, meaning you have to buy something of a similar or more excellent deal, right? And that can also cause some challenges; you don’t have as much of a selection, and you need to be diversified. It would be best to stay within the investment, real estate to investment real estate. And you’re also the timing, which we touched on, you’re having overpaid for a property, especially in a high seller’s market with low inventory, which is what we’re seeing right now. So that’s like the blockbuster way of doing things. And there’s a better way: deferred sales trust, not a Delaware statutory trust, but they’re a book kind of DSP. And that’s the Netflix way of doing things. Gotcha.
Billy:
Gotcha. Okay. Perfect. So So, it sounds like that was how you could do things; you had some parameters and said, Hey, listen, you have to figure it out in 45 days, and you have to purchase in the 180 days, and you have equal or more excellent value. And so I love that blockbuster analogy. And it happened to me once or twice when I wanted to get the video, and somebody was just in front of me. So I can relate to that. It hurt. So we talked about it now. You’ve given us an idea about the deferred sales trust. Could you take us from those blue and gold blockbuster days? And bring us up to today and talk to us about what precisely a deferred sales trust is and who this person is for.
Brett:
And so yes, great question. And I’m going to use the avatar that was the motivation for launching this company. And this person has worked for 20 or 30 years, right? This isn’t the Oh 506 market; they poured blood, sweat, and tears. They’re working in their day job. They’re also investing in real estate and building up this wealth. And this wealth represents their retirement; it represents them, you know, security, they’re getting cashflow, and they had sold high, and they kept exchanging, changing, changing. But then, guess what? Something happened in Oh, eight, and it’s known as the 2008 economic crash. And suddenly, they saw the wealth of their properties drop in half and the lenders chasing them down to renegotiate their terms. And the taxes having to be negotiated and tenants not paying rent. And they went from all the blood, sweat, and tears of all their wealth to being very wealthy and secure, to all the sudden, everything is upside down. And they’re stressed out, and they’re struggling. And that’s actually what happened. This is the story of many of my friends, family, and clients. When I was at Marcus and Millichap and Marcus and Millichap for your listeners, it’s a real estate investment brokerage firm where we help people buy and sell mainly multifamily properties. And that’s what I was doing in Northern California. And at that same time, I was newly married and trying to make it in the business. And I don’t know if you’ve ever been to a spot where you’re so scared you’re unsure how to feed your family. But that’s where I was. And that’s also where many of my clients were; although they were wealthy, they were fighting the banks. And they were losing some of them lost everything like, oh, eight crash right before this. So I was doing well. I succeeded and grew the business; oh, wait, hits, and everything stops. And so I have to pivot and adjust to what’s happening. It’s caused a lot of folks in different parts of the world. And at that time, I’m going, what is the best way to do this? We learned from a gentleman who taught us about the deferred sales trust. And so, by day, I was learning about that and applying that to the business, but by night, I did whatever a good entrepreneur does, and you get a side business and the side hustle to make this thing work. And so, by night, I was working at Cheesecake Factory. It’s a restaurant to support my family and wife at home. And because the real estate commercial real estate brokerage is 100% think they are some of you that make a big commission, or you make zero, and that’s what was happening in that Oh, eight crashes cases. I was this dual thing where I was trying to help my clients and go through my struggles. And then we learned about this deferred sales trust, and as I started to apply this to my clients, is Help them with their real estate; my business started to grow fast, for that was over. I was like in 2009. When that happened, I applied to the deferred sales trust to provide what’s called transformational exit planning; I learned the hard way how to do it the hard way. And now there’s a better way: the Netflix way. And that’s really about what we’re about here versus just a transaction. So with the deferred sales trust, you can announce, sell real estate, pay off all your debt, move it into a diversified, liquid portfolio of investment-grade securities, and go into real estate passively, let’s say, with a syndicator. Right with an operator.
We just did a deal in Georgia; gentlemen sold for $7.6 million. He was faced with 1031. He was a baby boomer and didn’t want to overpay for a property; he had all this debt. 4.5 million in debt. So instead of overpaying for a property, he moved all of this equity into the trust. And from there, he’s going to put in hard money lending; he’s going to put it with a good friend of ours and 500,000 already set with one of their apartment complex syndications and another 2 million with another syndicator. And that’s created transformational exit planning for him because he no longer has to have the towards-track liability. He doesn’t have to manage tenants; he can be out of the state of California, right, which is prices are through the roof. And he can diversify and truly retire from all of that. So I’ll pause there and see if that makes any sense. Have any questions there?
Billy:
Yeah, so it makes a lot of sense. And I love that you gave us a specific example. So this is really for the person who has been already involved in building their business on the side or investing in has been doing it for, let’s say, 15 2030 years, and was looking not to have to worry about the tenant’s toilets and termites, as they talked about, but looking for, as you talked about, the transformational type of exit plan also sounded like you were able to diversify, you can stay within the same kind of asset, but geographically diversify or with different types of, of areas that you can play. It could be self-storage, or it could be multifamily apartment complexes; I guess the one question I would have is, where are the limitations in terms of where the trust of your deferred sales can invest?
Brett:
Great question; what are the limitations of 1031, which is essential that we’ll compare it to the deferred sales trust? So the whole entity must move. Most folks will sell, let’s say, a 20-unit apartment complex in buy another 40 units in the same town, right? That was double their teams, and they might even increase their debt. And so they have yet to diversify. I mean, they’ve gotten more units, but they haven’t diversified an asset class, suitable product type, geographical location, or even, you know, security to get some liquidity. So that’s the first thing the 1031 is very restrictive. Even with syndications, in most indications, you have to have the entire entity move. In our deal, each syndicator can go their separate way into their own deferred sales trust and not have to be tied to anyone else and still prefer their tax. We just did a $16.7 million deal in Phoenix, but that exact multifamily deal. For that reason, most investors pay their taxes; this one deferred his tax. So 1031 is very restrictive, deferred sales, trust Netflix, right?
Very, very flexible, meaning you don’t have to go into lifetime real estate or don’t have to do with any short period. And then, you can send it to multiple operators and syndicators with numerous product types. And you don’t have to do equal or more excellent value, right? And so when you open up that kind of like, I call it the blue ocean when you start swimming with a blue ocean where there’s not a lot of blood in the water, which is like 1031, where everyone’s chasing yield and everyone’s in a frenzy to overpay, and everyone’s all everything’s restrictive. Suddenly, this is pretty calm waters. And I can relax, I can lower my stress, I can reduce my debt, I can be diversified. And I can genuinely retire and be passive if I want to. And so hopefully that answers the question is very, very flexible. And it’s, it’s at your timing, which is, I think, the number one thing for all of us,
Billy:
okay, and so then that makes sense. And it gives us more options, right? Number one, you’re not stuck in, and I say stuck, but you’re not in this same 1031 exchange; you’re not moving the entire block from one place to the next here; you can say, Okay, I have an entire pool. And I want to split this pool up so that I can invest in X, Y, and Z types of opportunities. With that, people would probably say, imagine where you’re someone who has been working for ten years, 15 years, and you’ve had a great ride since 2008. You got it right in 2010, something like that. And you’re, you’re exiting, and now you’re in your mind, you’re thinking, okay, do I do 1031 exchange? Or do I do deferred sales trust? So we’re not quite at those 30 years, right? But I’m sure that you’re seeing more and more people. So what are some of the thought processes, thought process that is happening for some of your clients who aren’t in that 30, and they’re more like in the 10 they’ve written wave the last 10 years?
Brett:
Great question, so you want to ask you have a couple of questions. What is your wealth plan? Right? And what? Where do you want to be in 134? or five years? And how are you going to get there? And then one with the least amount of risks and the most amount of flexibility and achieving your goals, right? So you want to just first of all map that out. And that’s step number one. Step number two is you want to determine your tax liability, figure out what your basis is versus what you would sell for, and what your gain would be. And then the next step is this what are your options? You can tend to do one. You can use Delaware statutory trust, you can share a remainder trust, or you can deferred sales trust, which is our favorite for most scenarios, given the marketplace, we’re in now, which is, especially in the US, highly appreciated, low inventory, lower interest rates, we have the perfect storm going on this perfect storm is prices that are through the roof. We’ve been here before, and potential cheap, significant changes, the potential re-correction of real estate. And so this is the plan, you can sell high, get out of debt, get diversified, get liquid, and just be patient again; now you’re swimming in the blue water, right? So you want to ask yourself the question, do I want to be swimming in the blue water? Do I want to be? I want to be my powder dry on the sidelines. In fact, in 2006, a gentleman did this. I call this a Monday morning quarterback. He did precisely this, he sold high, and he looked around at these values that didn’t make any sense for 1031; he sold a $20 million asset in Minnesota, across the street from the Minnesota Vikings stadium. And then he bought low five years later because guess what? His property was foreclosed on by the bank from the other buyer, who bought it at a high price. He was sitting in his deferred sales trust. So he got on the sidelines, all tax-deferred, and then he repurchased it at 60 cents on the dollar. And that’s what the deferred sales trust allows you to trade markets, but genuinely do transformational trading. When you’re not just selling high and buying higher. You’re selling high and buying low. And so that’s just understanding the timing aspect. And ask yourself, Am I in a highly appreciated market? Is it a good time to be a seller? Yes. Is it a good time to be a buyer? Probably no. Right? It isn’t the time to be a buyer. Okay, so establish that. So what tool allows me to transform marketplaces without having to do it within 180 days? And that’s when the deferred sales trust in our book is, hands down, the best way to create and preserve more wealth, especially whether it’s 510 15 years, n’t matter how much appreciation as long as it’s big enough, by the way, a minimum of a million dollars in net equity. And we need a gain of about $500,000 or so to make this thing make sense.
Billy:
Okay. Well, you just answered one of the questions that I was just getting ready to ask you, like when does it make sense, but also to use you started a little bit on helping to help our audience understand which questions they should be asking themselves, but also to you’re an educator. Can you tell us a little bit about your process? You’ve given us some clear indications regarding when it would make sense. But I want to reach out, and it helped me understand the process of getting educated by what you and your ecosystem look like today. Brett?
Brett:
Great question. So we’re like a guide. So, I’m not a nurse or an anesthesiologist or imagine going to the doctor. Billy, okay, I’m not the brain surgeon going to do the surgery, but I’m going to take you in and let you know. And I’m going to take your pulse, right, and maybe do some blood work and just see where things are at. But that actual brain surgeon is a tax attorney. See that he’s the one putting everyone back together. The first step is, is simply gathering the facts, right? Helping to either clarify your vision with you or just bring your vision out of what you’re looking to accomplish. So that’s the basis, and then obviously, establishing the why behind it as well, whether it’s a legacy play for a lot of our clients who have built up a massive amount of wealth, which, by the way, according to the American Bankers Association, the most significant wealth transfer in history, the planet’s health happening right now. And it’s about $17 trillion. It’s going to pass from one generation to the next in the next 20 years. And these are the baby boomers. And in fact, there are about 77 million in the US alone. And there are about 10,000 turnings, turning 65 every day, let alone the entire world, proper, where there are also tons of baby boomers that also have a massive amount of wealth. So how do they transfer that from one generation to the next without getting hammered by capital gains tax and still being able to retire and actually kind of enjoy and be more passive? So we’re going to clarify all of that. What stage of life are you in? What are your goals, right? What does that look like? And then we’re going to look for clues, right? Does success leave clues, such as what your depreciation schedule looks like? Well, it’s fully depreciated. I’ve been on this property for 27 and a half years. It’s multifamily. Okay, would you like a brand new depreciation schedule? Would you like the old one? I’d like a brand new one, Brett. We can do that with a deferred sales trust. So we check off that box. Okay, great. You’re in this massive amount of debt. Would you like to be in debt? I’m out of debt. Well, I want to be out of debt. Okay, let’s do the deferred sales trust. Check that off. Would you like to diversify or stay with Your single thing, and we’re just going to check off all of these numbers of items? Now we’ll draw a line down the piece of paper and say. All these top issues for your top challenges look like this doesn’t. What would you like to do? So the goal is just to provide clarity; I want to educate; I don’t want to sell; I just want to educate. This is what Steve Jobs went around to all of his Apple stores. And this is what he would say, he said, I would go in and say, Hey, I never want you to sell, I only want you to educate. And that’s just what we’re about. We’re really about educating. And the cool thing is we don’t charge anything for the due diligence. And we only get paid if your deal closes. And so we try to take the pressure off, providing education, give clarity, talk about our track record, which is the next most essential thing 1000s of closes over 25 years, over a dozen no change IRS audits, not one single issue with the IRS, and batting 1000. No pending legal litigation; the tax attorneys provide audit defense. So you get this dream team. That’s the next part of the vision where you’re not just getting Brett, you’re getting the fantastic tax attorney, you’re getting the outstanding financial advisor who’s separate from me, and we all work as a team to help execute these transformational exoplanets. That makes sense.
Billy:
It does make sense you’re putting together this transformational exit plan. And you’re the point guard rerunning the show; you’re the point of contact, and you’re building a team around you to be successful ultimately, right?
Brett:
You got it. You’re the quarterback; you’re the point guard. I’m like the offensive coordinator. And I’m like calling down the plays like, Hey, what do you think? Here we go. Okay, now let’s execute it. Let’s all do this together. Yeah. So we’re all working as a team. And that’s one of the best things about this. It’s more complex than your average deal. But you’re getting a team, and that team is going to be your dream team. And we’re all in this to win it together, defer your tax, maximize your wealth and opportunity, and optimize your tax taxes, as well. And when we do that together, that’s been the transformation that happens. Okay. And that
Billy:
sounds fantastic. And since you’ve taken us a little bit in that journey, and you’ve talked about being able to do a lot of the due diligence upfront and helping to educate, I guess, once there is the opportunity, that’s more of a kind of it’s focused on flat fees is focused on percentages, just so people also understand that you’re interested in making sure that they’re educated, successful. And then once that happens, the success looks like.
Brett:
Yeah, so I gathered the question. Say that one more time.
Billy:
Yeah, yeah, sure. It’s just a matter of helping people. So you take us to education through the education process. And then, in the end, based on when you can find a particular, like deferred sales trust, at the end of that journey, it is a percentage fee. Is it more flat fee-based? Yeah, in terms of costs, because I think you’re very clear about who the person is that you can help you help to educate them and really, so that they have that kind of understanding, like, what does that look like for them at the end of great
Brett:
question, what’s the cost of all this? Right? And when does it make sense? Okay, so I’ll use a deal we just did out of the south of Santa Cruz, and so the central coast of California, and they sold the property for 7.9 million, and they were looking at a $2.48 million tax if they didn’t want anything. So she’s in her 70s, wants to retire doesn’t want to chase properties. She’s tired of the toilet trash liability. So she’s decided the deferred sales trust is a perfect fit for her. And so what was her fee? Well, the first million dollars of it was about 1.5%. So let’s say you’re selling a million-dollar property for $15,000, it’s a one-time fee to the tax attorney, and you just pay it, and that includes the legal audit defense for the life of the trust. lifetime, right? So it’s really important. The second part would be on that million, about 1.5%. Ongoing recurring each year, okay. And that’s for the trustee myself, and that’s for the financial advisor. And then there’s like a miscellaneous and 12 $100 for a tax return, $250 for the mark-to-market report. And so the trust is going to pay out now; the goal is to out-earn all of that. So instead of paying the tax on her scenario, let’s fast forward to the total number; I think around 5.9 million went into the trust after the debt was paid off. And so you’re looking at, you could pay the 2.4 8 million, or you could pay the percentages on this total amount, okay, and hopefully will out-earn that 2.48 realize that 2.48 is Oh, it’s just not triggered today, it’s in a 0% interest rate from the government’s ability the government has will allow you to defer this at 0%, as long as you keep it invest in stocks, bonds, mutual funds, and real estate or your business deals, right. And the goal is to out-earn on an interest rate. Hopefully, about 8% on average over 10 years to pay about 1.5% per year. So you say all that sweet bread, I would have paid the 2.4 8 million, but instead, I got the full, you know, let’s say 6 million in there. And here we have the entire thing working for us. And that’ll pay some fees on that, but we’ll still net much more. So that’s the hope that answers the question. It does.
Billy:
Yeah, Yeah, it does. And I mean, it also just helps clarify because you’ve been so helpful and understanding that process and how you’re working with people and how you’re introducing them to other members of the team to ultimately help them be able to maximize the specific opportunity provide them with more diversification and options. And as a result, yes, there’s there are fees for that. And the idea is that you’re out earning any fees you would be paying. It makes a lot of sense. So there are many things we could continue to go into. But I, I, I feel your passion around this. And if you know, if you were to close your eyes, Brett, and think, Alright, listen, if we go two years in the future, like what are the things look like for you? How many people are you helping, and where are you driving your team in terms of the next stop in your destination? Or the next two years?
Brett:
Yeah, thanks so much. So we’re on a mission to train and equip 100,000 young business professionals, financial advisors, commercial real estate, syndicators, operators, commercial real estate brokers, luxury realtors, and Business Brokers, on this deferred sales trust and be like, you know, take them back 25 years old builder, 20 years ago, you didn’t know about the 1031 and say, hey, look at the 1031 thing you like, what’s that? Like? Well, you can sell real estate for different taxes. Oh, well, that’s what 1031, you know; it’s been a while; it took a while for it to catch on. And people use it. Now everyone knows it, right? It’s a blockbuster. Everyone knows the blockbuster. But you know, 30 years ago, people didn’t know about the blockbusters. And then they knew about it for a long time. Well, guess what? Netflix is going through the same thing. Even five years ago, 10 years ago, Netflix was so new people didn’t know about it. Now everyone knows about it. So the vision is to take the deferred sales trust, bring it to the net, you know, the Netflix type of understanding and ease of use, and equipping business professionals to be able to help their clients escape feeling trapped by capital gains taxes; why? So that they can give to causes that they believe in most so that they can retire from the total subtraction liability can fund their next business dream or venture. In one of the deals that didn’t Alabama, he sold a $2.6 million deal. He’s in his early 40s. And he sold a business property, and he moved it into the deferred sales trust. And he used the funds to start his next three, which is multifamily development. So he did non-lifetime through the deferred sales trust because he didn’t do 1031. And he’s building 80 units in Tennessee. Okay. And so that’s the transformational part of this. So we want to take that vision, take the education, coupled with the business professional so that they can explode their business too. Because guess what? The business professional is being challenged by automation every single day; automation is taking over technology. So what do you need? You need something that’s more than transactional value; you need something transformational. And what’s transformational is tax deferral, right? It’s the most significant wealth transfer in the history of the planet. It’s giving them the ability to be free from the toilet, trash liabilities, have diversification, and be out of debt. And when you connect those two, everything, everything changes. And that’s our goal. And then again, the back end of that is people can get to causes they believe that they don’t have to be forced into charity to do it. But they can give they can be directed into virtual stress as much as they want to different terrible causes. And that’s the vision as well, unlocking this capital that’s pent up in these illiquid assets, moving into cash flow producing assets so that they can give to causes they believe in us.
Billy:
That is fantastic. And just the fact that you have that vision of being able to impact 100,000 lives that can then go out and impact others’ lives, and ultimately allow them to have many more options and be a part of that $17 trillion transfer that’s happening now. Right. And so that is something just from a visionary standpoint, really makes a lot of sense, really makes a lot of sense, Brent, so I appreciate you sharing that with us. And you know, I guess it’s getting to that point of the conversation where there’s this part of the show. That’s the going long, final three. And the thing is, Brett, I only asked the going long last three if you tell me that you’re ready for me to ask you. So are you ready?
Brett:
I’m ready. All right, awesome. So
Billy:
I’m looking forward to this because I know you’ve gotten out there and traveled a lot. I would love to know; we started with you in California. And you know, I’m here in Barcelona. And so I always want to know, right? What is your favorite European city that you visited or is still on your bucket list? Oh, so
Brett:
Belgium, by far, I went to France, and that was amazing for the history and the culture. And I went to London; it was the closest to America. It was also fantastic. But Belgium was my favorite. You know, I don’t think due to Belgium, if you’ve been to Belgium, and you picked the potatoes. They’re like for Americans like it’s like a blowing. It blew my mind. And then also the beer. The beer was so good. I’m not a big beer guy. And I’m like, oh, Belgian beer. So we had the opportunity to travel with some of my teammates. I played basketball in college, and we did like a friendly tour. So we toured these three cities painting, playing, and folk, and the best part about Belgium to was the people that were so kind, and I’ve never experienced it. So we play basketball. It’s an intense basketball game. I have no clue. You know, we’re battling about. Are we battling? Is the team really good? That’s one of the things that beat us. The other teams we beat, they were good. They’re, like, a Semi-Pro team. And then they take us upstairs until they’re like, like the restaurant slash bar, like it was. It was like, you know, the historic wood and the actual bards, and they’re bringing us beers, and they’re bringing us food, and they were all hanging out. We’re like, these guys are like, on buddy. We were such a refreshing type of constant competition, bringing countries together and doing it through sports. And so Belgium, by far, was my favorite of the three soapboxes, and I’d love to be in Greece; I love to be in Spain. And I’d love to spend time in Italy. Those are my three bucket list places.
And I’m a big friend. I’m a big fan of Belgium as well. But my wife and I spent some time in Brussels a number of years back, and we were there for New Year’s Eve and living here in Spain. I love it. And I lived in Italy, as well, but we’ll talk about that. We’ll talk about that later. So thanks for sharing that. The next question is about lessons learned. Right? And so you’re a very successful person, you’ve had lots of life experiences. And I always joke and say, Look, I know most successful people, you’ve probably only made one mistake, and I’m sure you’re in that group. Or maybe not; maybe you’ve made more than one mistake. But I’d love to know what lesson you learned from that one mistake that you would share with somebody else with the hopes that they don’t make the same mistake.
Billy:
And I’m a big friend. I’m a big fan of Belgium as well. But my wife and I spent some time in Brussels a number of years back, and we were there for New Year’s Eve and living here in Spain. I love it. And I lived in Italy, as well, but we’ll talk about that. We’ll talk about that later. So thanks for sharing that. The next question is about lessons learned. Right? And so you’re a very successful person, you’ve had lots of life experiences. And I always joke and say, Look, I know most successful people, you’ve probably only made one mistake, and I’m sure you’re in that group. Or maybe not; maybe you’ve made more than one mistake. But I’d love to know what lesson you learned from that one mistake you would share with somebody else, hoping they don’t make the same mistake.
Brett:
Yeah, good question. So earlier in my career, I’ll tell you a real story; this is good. And then, I’m going to come up with the macro version. Okay. So the real story was I was competing for the listing. And this is like, during the again, this is like the crash, right? Every dollar counts for my fame. This can change everything. And I’m competing for this listing, and I’m working with it with the seller and developing the relationship, underwriting the property, getting all the way down to the, you know, to the 12th hour to listing the property. He calls me blue, it says, hey, I’ve got another kind of friend, you know, that I’ve been, he’s a residential agent. And I’d like you to partner with him, are likely to consider partners, and it’s how he said it. And, and, you know, what do you think, and, and I like to compete for the business, and you know, thinking that I have the cards or that half the value that I’m a multifamily. And I had almost too much pride in what I was doing. And he and in like a week or two weeks goes by and this like, it’s like nothing, nothing happens. I call it. Hey, what’s going on? Well, the property has been listed. And I’m like, and I lost the listing. And he that agent ended up going with one of my competitors, who is intelligent and successful. And not only did they sell that property, but then they sold it again. And not only that, but they represented both sides of both properties. So literally hundreds of 1000s of dollars of commissions. And I’m going, oh my gosh, like had I just got out of my way and just said, Hey, client, this is important to you. It’s important to me. And I would ask the better question, Oh, tell me more about the relationship. Tell me more about him. Let me meet with him; let me go sit down. But I was kind of closed off. And I had my pride get in the way. And that was a mistake. And so I’ll now on I just look; I’m here to serve you and your best interest; hear my thoughts. But let’s do what you want to do. I’m here to work for you and work with you. Suppose you want to work with somebody else. Let’s work as a team with all do it together. And so that is my one backside macro one; the big one was learning to work harder on yourself than you do on your job. This is a quote by Jim Rohn. He stated if you work hard on your job, you’ll make a living for Carter, and you will make a fortune. And the idea is not to make a bunch of money, although that’s cool because you can help many people, the idea is to become everything you were created to be. You know, we’ve been given God-given gifts. And these gifts are given to us to be a blessing to our family and others. But it’s only when we use those, exercise those gifts and work on those gifts, and work on our health, our finances or personal development, our leadership, our spiritual walk, and arsenal our career, you know, we’re working our entire selves, that we become more and we become more we can give more. And when we offer more, we can earn more which thing we can provide more. So it’s making that shift the longest time I was taught: go to school, get the grades, get the job, get you to know, and get the money. And those are all external things. And guess what? External things are temporary, Billy, right? But the internal things are what we become right. And the value will become, as always, far more valuable than what we get right. What we get is only temporary and will become eternal. And so focusing on that also brings more fulfillment brings more joy to myself and my family. And that changed everything when I switched my mindset about learning to work harder on myself than I did on my job,
Billy:
which is fantastic. So it’s really about being internally focused, but for growth so that you can grow yourself, and then there’s also the concept of really having the abundance mindset versus the scarcity mindset. Working with others, and you’ve talked about that multiple, different times in this conversation, the way that you are working within through teams, and ultimately doing that for your, your clients, and your investors. And so that makes a lot of sense. And so we’re going to get to the last question. And it is about you talking about internally, right, and focusing on the internal. And I also want to understand about how you can fill your mind right. And so help us understand what book you would recommend to the gong. Audience?
Brett:
Yeah, so the book I read every day is the Bible. I’m a Christian. And so filling my mind with what I believe is God’s word, God’s authority, and God’s truth. And as I do that, and I’m following and trying to be close to God, everything else can be going haywire, really, right? It could be the business is not doing well, or this isn’t going well. And this is a theme throughout my entire life, all of that could be going, you know, COVID-19, the economy, all these challenges, but if I’m close, and I’m following God, I’m close to God, I’m at peace, I can’t explain. I can’t explain the peace. And the opposite is true. If all those things are going great, I’m making a bunch of money; I’m successful in all these things. But if I’m not close to God, and I’m not spending time in his words, and I’m not connecting with him, then there’s something missing, right? I don’t know what it is, but it’s not a P. So the Bible is my is my is my source for renewing my mind. The second one would be a different book by Jim Rohn. And it’s called the seasons of life. And it’s it touches on just the winters, the falls, the springs, and the summers; it talks about the human condition and the human story that we’re always going through different parts of our lives, distinct seasons. And so, for example, the COVID-19 season, you can be considered, most would consider a winter, right, a cold, bitter winter, that’s been very, very tough. And guess what, there’s a springtime. And it will, you know, the sun will come out, and things will get better. But in the meantime, it’s not just two; it talks about what you do in the winter, right? It’s making sure to reflect on clarifying the important things to you. There’sthere are some positive things that have come from COVID-19. And that will change the world forever. And that’s what I that’s what this book draws out these questions that what you should be asking yourself in these winters, and the winters can be with your family, it could be with your kids, it could be defining news, it could be with the country that you live in, you know, the US is going through a lot of tough things right now. And it’s genuinely a winter in so many ways. And there is hope for spring, right? And they talked about what we can do as leaders and how we can grow and make a change. And those are the things to focus on. And then, when the spring comes, there are also things to consider. And then, when the summer comes, don’t rest, right? There are other things to talk about. So that books excellent call The Seasons of Life by Jim Rohn,
Billy:
the seasons of Life by Jim Rohn. Fantastic, and we are going to take the Bible because that was your first one. So we’ll see how we can include them both. But I guess you know what, there are so many things, I mean, just talking about from the very beginning and talking about, you know, your involvement in sport and working with teams and then being able to recognize that something was was in the world of the Western world, and you want to be able to take something that was already there, you want to now expand on that continue to educate the marketplace, you want to be then able to positively impact 100,000 lives so that you can ultimately impact so many more to provide our audience or people in the world with new options and be able to do with those options of things that give them the most impact on their life. And so, with so many different examples that you’ve shared with us with so many positive things that you are doing right, I know that there are so many people that are part of our listening to the conversation today and watching us on the video that wants to find out how they can engage more with you? How can they engage more with your team? Can you help us understand the best way to connect with you and your team?
Brett:
Excellent, thank you so much, Bill. Yeah, two ways. So if you’re a business professional, once you go to expert tech secrets, calm. And I want you to look at that offer for you to get equipped and take your first step towards transformational exit planning for your clients as Business Brokers, financial advisors, again, commercial estate, syndicators, operators, luxury realtors; all of you should go there, check that out. If you are an owner, or if you’re a business professional, you want to check out our website, go to capital gains tax solutions calm. And there you can, you can schedule a free consultation, and you can also get access to our deferred sales trust calculator. And you can download our FREE eBook nine. Sell your real estate or business smarter and nine steps, and you can check that out right now. Fantastic. So capital gains tax solutions calm. And then, can you repeat that one more time? The expert, expert, tax secrets.com
Billy:
expert, seekers calm Okay, fantastic. We’ll also include those in the show notes as well, Brett. So listen, thank you for taking the time to invest time with me and with our going along audience today. It’s been very, very useful, very helpful, very impactful. And so thank you very much. For investing time with us today.
Brett:
My pleasure, Billy; thank you so much for having me. All right, fantastic.
Billy:
And the going extended audience, Listen, thanks once again, as well, for investing your time with Breton; I helped to uncover something new for us for the first time for many of us to go and understand more about the deferred sales trust. And also talked to us about more of the legacy, which was a 1031 exchange. And he also talked about some of the other different concepts and understanding how to be a part of a team. You can have more options to do what you want to do and invest your time, etc. So, you got a lot of value from this. So feel free to share today’s episode with at least two or three other friends, and then they can also be positively impacted by the things that Brett shared with us today. We’d love to get a review from you as well. Share the things that you like and help Britain. What are the things that you found the most value in? What would you like to hear from Brett the next time he comes back to visit us? And if you want to leave a five-star review, do that as well. Until then, I look forward to welcoming you back on the next episode of The going long podcast. So before then, go out and make it a great day. Thank you.
Wow, don’t you love hearing from top-notch experts in the field? When I was getting started, I wished I had access to such experts. And even more, they would have given me a really simple list of things to follow so that I could have gotten to my goals much faster and been much happier even sooner. So that’s why I’ve created for you the seven things that you should avoid to be successful in long-distance investing. And you can pick that up easily by going to Billy Keels comm forward slash seven things to avoid. And also, if you’d like today’s episode, don’t forget to leave a five-star review. I’m looking forward to seeing you on our very next episode. So go out and make it a great day.
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About Brett Swarts
is the best real estate, financial m&a advisor, and business professional in the world where they share their ideas, deal stories, and inspiration. So together we can make complex business models simple and helping to you to grow and exit very well in your business am excited about my business partner and guests and an announcement to make in regards to Michelle Siler Tucker joining exp as an m&a advisor. And we’re going to get to know her a little bit more in today’s episode, but just for those who don’t know her, she’s one of the top closers in m&a business across the nation with over 20 years of experience, and just countless amount of businesses bought and sold. She’s also a two-time number one best-selling author, speaker, TV, radio host and venture capitalist, and business owner. And also a recent book, New York Times bestselling author of exit rich
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