multifamily

506B or 506C Syndication? Multifamily investor Rob Rowsell explains the important differences between these two types of Regulation D investing plans.

Do you know the difference between 506B and 506C Regulation D real estate investment types?Regulation D Investing Plans – What is the Difference?

Rob jumps in to explain the difference between Regulation D Investing Plans. Is a 506B or 506C syndication plan right for you? Read on.

506B Regulation D Investment Plans

Real estate industry pros refer to the Reg D syndication deal 506B as the “Friends and Family” plan. If you seek out this deal, the main rule is that you must have a preexisting relationship with your investment partners.

Before signing the PSA, you must provide proof that you know them. You also may not solicit investors publicly for these properties. This includes online advertising, print ads, and in person public appeals through your local chamber of commerce or other forum.

506C Regulation D Investing Plans

Regulation D investing plans classified as 506C are for accredited investors only. This means you must have a net worth of at least one million dollars. That net worth excludes your personal residence. You can also qualify if you have earned over $200,000 in the previous year as a single, or $300,000 as a married couple. Financial institutions also need confidence that you will earn that same amount in the following year in order to approve your plan. If you are approved for a 506C investment plan, you are free to advertise your deal to other investors publicly.

Join Our Community

Do you own multifamily properties? Do you aspire to one day? Then you should consider joining our online discussion group, the ATL Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!

What are the best wealth building books for your shelf? Rob Rowsell, successful multifamily real estate investor, reveals what material you need to read in order to increase your financial IQ!

Which wealth building books should you study? Recommended reading for real estate investorsBest Wealth Building Books – The Wealthy Code

Rob starts the video clip by introducing the book The Wealthy Code by George Antone. Specifically, he covers the three levels of affluence it covers, relative to financial independence. Each level (Rich, Wealthy, Job) centers around businesses. Rich Dad, Poor Dad author Robert Kiyosaki defines a business as an entity that can operate independently if you, the owner, were physically absent for a year. If that statement isn’t true for you, you have a job, and can’t be financially independent. A job requires your time and attention for a minimum of ten hours per week.

If wealth building is your goal, then you must develop passive income. Anyone with a job that pays above their means can start small, investing that extra money into investments that appreciate in value. Eventually, those properties will generate cash flow. Cash flow is wealth. Learning that fact and amassing the knowledge on how to properly redirect those funds was a game changer for Rob Rowsell.

When Rob first started his house flipping business, he was not setting himself up for regular passive income. A mentor advised him to keep every third or fourth property and collect rent from the tenants, rather than selling it. This meant that he could gradually decrease the work hours he invested in his real estate business. Over time, that business became less of a job, and more of a passive income engine.

Best Wealth Building Books – Money: Master the Game

Next, Rob shares a page from Tony Robbins’ book Money – Master the Game. This is one of the best wealth building books, cited by countless successful investors. The page features an illustration of a mountain, outlining a wealth journey. The peak of the mountain, labeled “Critical Mass”, represents the point where we retire. As we climb the mountain, we are accumulating money for our retirement. The de-cumulation phase occurs on our way down from the peak.

The “Nest Egg Theory” says we should have a big enough bag of money saved up to last us the rest of our lives when we retire. However, life happens. The nest egg may not last us the rest of our lives. We may have to work another job in our golden years in order to make ends meet. Ideally, we have a passive income stream instead that ensures that we make it through.

Join Our Community of Investors.

Do you own multifamily properties? If not, do you aspire to one day? Then you should consider joining our online discussion group, the ATL Community! Each month, Rob Rowsell will teach you what you must do in order to build wealth in the real estate business. It’s not as easy as it looks! Property taxes, liens, and legal fees can all be hard to navigate, so having a successful guide in your corner like Rob is a must! Enroll today!