The Liberty Group, LLC
Managing Principal, Sr. Financial Advisor
Will Thomas is the Principal and Sr. Financial advisor with Kapital Asset Management, dba The Liberty Group, LLC in Washington, DC. Within the Financial Planning Industry, Will has obtained designations as a CFP (Certified Financial Planner), CIMA (Certified Investment Management Analyst) and CTFA (Certified Trust & Financial Advisor). He also holds a Bachelor’s Degree from Fayetteville State University in Mathematics and Economics. Prior to joining the Liberty Group, Will worked Wells Fargo Advisors (2013-2016) and Merrill Lynch (2009 – 2013).
As the Managing Partner of the DC Liberty Group Office, Will believes his firm to be “Small enough to Care, but Large enough to Inspire”. And as an advisor, Will gives great CARE to the individuality of his clients, their goals and objectives; while looking to INSPIRE our clients to live their lives by design, not by default.
Will’s experience in the Financial Markets include the banking, mortgage, insurance and capital markets. As a Financial Advisor, Will believes that having a well-rounded, in depth knowledge of all the major line items affecting a client’s balance sheet is key to offering sound financial planning and consulting on a holistic level. His ultimate goal for his clients to help them understand that true financial planning is an individualized, ongoing process affected by many small and large financial decisions.
Will understands The Financial Services landscape continues to evolve as new technology, new regulations and new demands from his clients force advisors to have a well-rounded skill set complete with more than an understanding of one market or one product. By embracing these changes, he continues to create awareness with his clients about the many benefits of deliberate financial planning, which studies have shown to reduce anxiety, simplify and organize objectives along with saving/making more money.
BS, Mathematics and Finance, Fayetteville State University
This should be a "lay up" for your financial advisor due to the fact that he/she probably has answers to some of the key questions one would need to make this decision. When it comes to debt reduction versus investment options, these sort of decisions are quantifiable, which makes them cut and dry. But there are key questions that should be addressed. In what stage are you in as it relates to your mortgage (how many years left and what amount is now going towards principal)? That information can be found on your amortization schedule. The same holds true for your truck loan. Normally, the ideal situation is to have the debt load rate significantly lower than your capital investment rate of return. That seems to be the situation here. But other factors to consider is whether you wish to increase your monthly cash flow by paying off some debt and reinvesting that new cash flow. Some forecasting may also play a role in the decision. If your advisor sees a pull back in the market, take the opportunity to pay off/down some debt, freeing up extra monthly cash flow, and dollar cost average you way back into the market.
Options can be used as a form of insurance when securities are already owned by the investor. For example, if an investor owns a portfolio valued at $100K made up of securities that move in lock step with the S & P 500, to protect his/her portfolio from a downward market turn, the investor can buy Put Options to match the value of the portfolio. If the options are a 1 to 1 match with the portfolio, if or when the portfolio value loses 5%, the value of the options should increase by 5%, therefore insuring the overall value of the portfolio and option values at $100K. And as is the case of normal insurance, there is a cost for the protection of insurance. Options can also be used as a form of speculative trading. Due to the leverage involved with options, when an options trade goes against the investor, the investor can have more capital at stake than what was used to purchase the options. When stocks or other securities are purchased (without the use of margins), the only capital at stake is that which was used to buy the asset.
Although there are no guarantees, the nature of investing is to buy low and sell high. If you buy more shares in the fund as the price goes down, "are you making money?" Technically, no. The fund theoretically could fall all the way to zero, and reinvesting the dividends was nothing more than throwing good money after bad. But that's now how it "usually" works. The advantage to buying with the price goes down is the ability to acquire more shares for a lower cost. When the price rebounds, more shares (which is what you want), will equal more money being made.
Some mortgage lenders will consider a conventional loan program for clients 3 years after a foreclosure is listed on a person's credit report. If the credit score meets the criteria, has no late payments in the last 2 years, and no balance owed to the mortgage company, a borrower may be approved for a prime loan program. With that being said, all of the other lender's guidelines will also need to be met; i.e., debt to income ratios, collateral, employment history, down payment amounts, etc. There are other options out there in addition to conventional mortgage lenders and credit unions such as private/hard money lenders as you mentioned. Normally, the institutions require much more in the range of collateral with much higher rates. Also, depending on the seller's situation, don't take seller financing off the table just yet. Their situation may be more enhanced by leasing to own the property for one or two years instead of taking the hit on capital gains if they have no losses in their portfolio to offset the gains.
Unfortunately, the 1031 exchange rules are very precise. It doesn't appear as if all the criteria were met regarding your transactions. The primary 1031 exchange rules and requirements include: 1) same taxpayer, the taxpayer who sells is the taxpayer who buys, 2) property identification within 45 calendar days post closing of the first property, 3) purchase of the replacement property within 180 calendar days, 4) trading up, the price of the replacement property is equal to or greater than the old or relinquished property, 5) hold time supports the intent to hold for investment, and 6) related party transaction regulations.