Updated: Jul 4, 2020
In this episode of the Passive Cash Flow Podcast, co owner of Peoples Capital Group Aaron
Fragnito explains why doctors love PCG. If you are a high earner and looking to pay less taxes and build your real estate wealth, this episode is for you!
The Passive Cash Flow Podcast is for beginner or experienced investors. Subscribe today to learn how you can diversify out of the stock market, own a part of an apartment building & start earning Passive Cash Flow! Peoples Capital Group has been helping passive investors build wealth in NJ real estate for 10 years.
Visit www.PeoplesCapitalGroup.com to find out if you qualify to start earning passive income and pay less taxes via investing in real estate. IRA's and 401K's are accepted.
Aaron Fragnito: Hello listeners, and welcome back to the Passive Cash Flow Podcast. I'm your host, Aaron Fragnito, co-owner of Peoples Capital Group. This is episode number 31. Today, we're going to talk about why doctors love PCG, and how our tax strategy here at PCG is really favored towards higher earners, such as doctors.
Aaron: Okay listeners, so here at the Passive Cash Flow Podcast, we like to explain why we do things, not just how we do things. One of the reasons that we focus on buying multifamily properties, making them more profitable, and then refinancing them and splitting up that capital from the refinance to all of our investors is because it's a tax strategy. It's really just a way to keep more of your money, and give less of it to the government. That's our goal really at the end of the day for anyone who's trying to earn strong returns with their capital, and get their money working harder for them.
Here are at Peoples Capital Group, we work with high earners like doctors and dentists, and individuals that are making a very high W-2 income. Now, W-2 income is the highest taxed form of income, meaning that, unfortunately, if you're earning income through a W-2, as most of us earn as employees that are a W-2, then you are getting hit hardest from taxes, and giving too much of your money probably to the government. We try to set up a strategy here where investors can get more tax shelters and give less their money to the government.
Not only are they going to be able to write off the cash flow they're earning on the building, but doctors and passive investors here at People's Capital Group can write off additional forms of income. Say if they own their own practice, and they pay themselves as a partner through an LLC, maybe they own a practice, they can actually use the additional tax depreciation on the building to go write off other forms of LLC income. Just partnership income. That's really one of the amazing things about owning apartment buildings over stocks or other asset classes such as bonds as well. Real estate gives you tax depreciation, so you can write off that cashflow and then our investors get extra tax depreciation to write off other forms of income, which is even more amazing for our passive investors.
Another reason doctors really like Peoples Capital Group and other high earners because of bragging rights. Quite frankly, it's more fun to own a big apartment building around town or a few towns over than it is to own a stock or an index fund or own some number on a screen. You really don't get as much excitement out of owning an index fund. It goes up when the Dow goes up, it goes down when the Dow goes down. That's really how it goes with index funds often, you have no control over them. You can't drive by them and point them out to your friends or say, "Yes, I own a 25-unit in this city, and we're improving it and we're getting better rents and we're making the area better. The income on the building is excellent. I'll drive you over there one time more in the area."
That's more fun. It's a tangible asset. You could show it off to your friends and your spouse, and you could talk about the city that you're improving. That allows our investors to just get more benefits out of this investment over an index fund. Not only is it a cool tangible asset they can point out to their friends, but it's people, it's actual families. It's things we're changing actual people's lives. That's more important often to our investors than owning an index fund or some stock that goes up and down. It's more important to use their money to improve cities and change people's lives for the better, and allow us to renovate these buildings and make family friendly environments. The returns on the buildings are stronger as well.
Also, doctors love to diversify. They want to be in multiple asset classes. Anyone who is busy building their wealth day in and day out, needs to be diversified. You want to have some stocks, you want to have some bonds, you want to have some tangible real estate assets syndication that you don't have to manage day in and day out. It's good to be diversified and here at People's Capital Group, our syndication allows that.
Another item is ease of mind. Of course, a lot of doctors have maybe purchased a strip mall or a center where they are working with a management company to manage their real estate, and they're on the hook for other responsibilities as the property owner. Lots of doctors think that's a great way to build the real estate wealth. Other investors think that's a great way to build the real estate wealth, but then quickly find out that being the person to respond to the management company or being the person in charge of managing the real estate, actually is not a hands off job and actually is a pain in the neck.
By working with People's Capital Group, they can still own large commercial real estate, but they don't have to do all the work or be on call to the management company or be on call to the tenants or beyond the mortgage, of course, as well, with a huge amount of risk there being on the mortgage. By working with us at People's Capital Group, there's an ease of mind that allows them to not have to worry about those things and deal with those responsibilities day to day.
Of course, returns. That's not the top of the list by a purpose here because really, returns are not the top thing that high earners such as doctors worry about. First of all, first thing they worry about is, is their money safe? Their money is backed by tangible local well-managed real estate, so they know their money is safe, and that ease of mind, that cash flow check in the mail, that wealth growth over time, and those tax write offs really set our investor's mind to ease, knowing that their money is backed by a good, tangible, well-managed asset in a high demand market. That allows them to not only make better returns, which is feel better about what their money is doing, where it's positioned, how safe it is and what the long-term returns are going to look like on an asset like that, which can be phenomenal over time.
The final thing that doctors and higher earners or passive investors in general love about us here Peoples Capital Group is that we continue to teach them. We continue to offer webinars and information and videos, and these podcasts here, so that investors can learn more about real estate, the buy, renovate, refinance strategy, and just general market updates and what's going on with the market right now, with everything going on and new updates in the market as they arise.
Here at Peoples Capital Group, we really try to offer our investors a nice experience, where not only learning about the asset, learning about the opportunity, is fun and enjoyable,
then also the experience of getting invested in the asset is understandable and enjoyable, and not some type of race to the finish, but a good experience where they can learn about what they're investing in, and then start earning returns relatively quickly in some high demand real estate here in North Jersey.
If you want to learn more about how to get qualified to join the PCG Investor Community, you can go to our website, peoplescapitalgroup.com or you can click some links at the bottom to learn more about what we do here at Peoples Capital Group. See if it's a good fit for you and what you're trying to do with your capital, and in your retirement going forward with real estate here in North Jersey. If you want to learn more about that, go to peoplescapitalgroup.com. Hope you enjoyed this message. Hope you have a good day. Whether you're a doctor or a high earner, or just someone looking to learn more about how you can build your wealth passively in real estate, check out our website peoplescapitalgroup.com.