Episode Transcript
[00:00:00] Speaker A: Foreign.
The podcast for those who find themselves immersed in adversity and choose to write their story instead of having others write it for them. I'm Drew Duraney and I'm your host.
Today's guest is Adam Bergman. Adam Bergman is a well known figure in the world of retirement planning, particularly for his pioneering work in the self directed IRA individual retirement account industry.
As the founder of IRA Financial, a leading firm specializing in self directed retirement accounts, Adam has built a reputation as a highly respected expert on alternative investments and tax advantage retirement strategies. Before founding IRA Financial, Adam worked as an attorney specializing in tax law focusing on retirement and investment strategies. His extensive knowledge of tax codes, erisa, which is Employee Retirement Income Security act and IRS regulations, gave him a unique perspective on the potential benefits of self directed retirement accounts, which at the time were relatively underutilized. In 2010, Adam Bergman launched IRA Financial with the goal of facilitating the setup of self directed retirement plans and also providing comprehensive guidance on how to structure these accounts and navigate the legal intricacies involved. A self directed IRA allows individuals and business owners to invest a wide range of assets, including real estate, private equity, cryptocurrencies, precious metals, and even startups which mainstream IRAs do not permit. Under Adam's leadership, IRA Financial grew into one of the largest, most recognized firms in the self directed retirement space with over 25,000 clients and over 5 billion in assets invested. Adam has written extensively on topics such as self directed IRAs, both traditional and Roth solo 401k plans, the legality of alternative investments and tax strategies. In addition to authoring nine books, his work has been featured in over 100 prominent media outlets such as Forbes, the Wall Street Journal, and Business Insider. In addition to his writing, Adam has appeared as a speaker at numerous financial and investment conferences and podcasts where he shares his insights on his future of retirement on the future of retirement planning and alternative investments. His expertise and ability to simplify complex tax and legal concepts have made him a trusted resource for both individual investors and financial professionals. Enjoy the show.
Adam Bergman, so good to see you.
[00:02:44] Speaker B: Great seeing you Drew. Thanks for having me.
[00:02:46] Speaker A: Oh, it's my pleasure and you're welcome.
So I want I always thank the person who introduces us. So John Moss, you get a big thank you for introducing me to Adam. You were right. I think he's an awesome guy and we're going to have a great, great talk.
So audience knows this. I always talk about how when we're young we're taught that life is linear. It's not a malicious teaching. People hope it is for us, and for the most part, in the beginning, that A plus B plus C equals D. For the most part, life is linear until it's not. Until adversity rears its ugly head.
And when adversity rears its ugly head, that's adversity. And adversity is testing us. And I believe there's three types of men. You got man number one, who's got so many blind spots. He. He doesn't even notice the adversity because he's been told, you're living this life and you. And you live the life the way we're outlining it for you. And that's the way it is. So he doesn't even see the adverse or see it as adversity, and he just goes upon his way and doesn't change anything. I don't have man number one on the show. Man number two, however, does see the adversity. Yet he says, I'm the victim. Life's doing it to me. I can't change anything. It is what it is. Everybody else is to blame, and he doesn't change a thing, thing, even though he had a chance to. And on his deathbed, he's got a ton of regrets. And then there's man number three, Adam Bergman. The men I have on this show. Man number three sees the adversity as a heightened self awareness. Says, I'm sick and tired of being sick and tired. This adversity is not a barrier. It's an opportunity for me to do something different. Take massive action and become a stronger man on the other side.
So with that said, Adam, please reach back as far as you need to for that defining moment. Whether it was the tap on the shoulder, the whisper in the ear, or like what I needed two by four upside my head, I kind of transformed you from the man you used to be to the man you are now and how that transformation impacted you personally and then professionally.
[00:04:37] Speaker B: Okay, so I, I have to go back to, I'd say February 8, 2022. That was the day that there was a major turbulent event in my business. There was a crypto hack of almost $40 million.
And thankfully, you know, the FBI found the cryptos and the clients are going to get their money back. And it's four years later, it's still going back. But going back to 2022, this was a significantly traumatic event in my business. IRA Financial was growing tremendously at that point. We had over 20,000 accounts, probably over 3 billion in assets.
And, you know, we help people take their retirement Funds and do alternative asset investments, you know, like real estate and cryptos. And we had a very strong crypt, and there was a hack. And this money was taken from a major crypto exchange that we were the custodian of the ira, but the cryptos were on the exchange.
And this third party who's in jail now, the FBI thankfully found him, stole the crypto. So I was at a real.
I think a really.
I was at the cliff of what to do, right? Just, you know, obviously, we didn't have enough insurance to cover $40 million. We're not in the crypto industry, right? We're just an IRA custodian. Even though we have $3 billion at that point in assets, it's not cash on our balance sheet, right?
[00:06:05] Speaker A: It's.
[00:06:06] Speaker B: It's. We're costing people's real estate or private equity or hedge fund. So what do you do? Right? So you have choices, right? You could go bankrupt, right?
That's one choice.
You could fight. Really? There's no other. It's. It's like you're pregnant or not. You have two choices. You either fight or you don't. So.
And I was really looking at both. I love my business, what we were doing, but we needed to figure out how we can, you know, make this right.
You know, there's litigation paths, and also, just, like, from a business standpoint, how do you keep going? So I remember, and actually, like, the.
[00:06:42] Speaker A: The.
[00:06:44] Speaker B: The impact point for me was, was my wife. I mean, so if you asked who, you know, who hit you over the head, but the two, by far, it was my wife. And. And one night, I was just like. I couldn't sleep. I was going through a lot of personal grief, felt the guilt because there was stuff on our end that we could have done better. I, I. I was too loyal to certain people, that, on the tech standpoint, that we should have been stronger. Like, this should never have happened.
And, you know, ultimately, my wife, you know, looked at me and said, okay, Adam, like, what do you want to do? Do you want to give up, or do you want to fight?
I was like, what do you mean? She's like, you have two choices. Either give up, just quit, sell the rest of your business, go bankrupt, whatever it takes, or fight. She's like, you didn't steal the cryptos. You didn't do anything wrong. Fight.
And from that day on, I said, you know what? I'm gonna fight. I'm gonna fight, fight, fight.
[00:07:34] Speaker A: And we.
[00:07:36] Speaker B: Yeah, and this. It took around two years, and we, you know, we were able to settle with a lot of clients. And then the FBI was able to find the criminal, and he's serving 20 years in jail, and they found the cryptos. So a lot of good things happen. I was very fortunate, but still, that was the turning point for me where I had two choices. I can just give up where I guess some people would have done it. But ultimately I didn't do anything wrong and I believed in the business, I believed in what I was doing. And my wife was the one who's from New Jersey and she's tougher than me. And she said, you know, yeah, you, you either give up or fight. And if, if you give up, then maybe you, you actually, maybe you stole the cryptos, maybe the FBI should arrest you, but I don't think you stole the crypto, so you might as well fight. And that's what I did.
[00:08:19] Speaker A: Well, you know, it's, and kudos to, to her and you for listening to her.
It takes, it, it takes a good, strong couple to be able to make decisions like that. And you also had your reputation at stake in the, in the, in the business. And now, now people trust you because you stood up and you fought. You fought for that. You fought for yourself, your own reputation and your legacy, but also you felt, fought for your clients, and that's why they trusted you to begin with. So there's a lot of good that comes out of something like this. That silver lining in your, this, this, this fight part, did that stick with you in other aspects of your life moving forward? Or did you, were you never a guy who gave up?
[00:09:01] Speaker B: No, I, I, I'm not a fighter. Believe it or not, I grew up in Canada, so maybe I'm just, you know, a little more passive than most people.
[00:09:08] Speaker A: Okay.
[00:09:08] Speaker B: But I'm super, I'm super competitive when it comes to what I believe in. Okay? So if I play my friend in tennis and I lose, I don't really care. I'm not one of those people that will like, throw the racket if my friend beats me. But when it comes to something I believe in, something I care about, like my business, yeah. Then I'm going to be super aggressive. I'm going to fight. And it's helped me.
As you said, the silver lining in all this is that I looked at my business and I said, okay, how did this happen? Right? Like, I had to kind of do some, some self awareness here. And I said, this is my impact. This is what I can do to make sure this doesn't happen again. And how could I learn from this event because I do believe there's always a learning story. And what, what I think I took from it is that I was just way too loyal to certain people, as I mentioned previously. And I had certain people in certain roles that I like. They're my friends. I worked with them for 10 plus years. But as the company grew and scaled like they just didn't have the skill set I needed at that point to help. And that's what I took from it. And I really cleaned house and brought in a whole new team. And guess what? The company has grown even more significantly than it did before that incident because I had the right people.
[00:10:18] Speaker A: It's an interesting thing you say because there's a little phrase that people come into our life for a, was a reason, a season or a lifetime.
And sometimes we are too loyal to those people who really are meant to be in our lives at that point, in that place for a season. And we keep them for a lifetime just because we feel loyal to them.
And that was my mistake. It's not a personal thing, it's just the way that we do things. So good for you.
So how's the company now? Tell us what, what actually, Tell me a, a success story for a client, A recent success story that you're proud of.
[00:10:57] Speaker B: We got a lot, but I actually just spoke to a client about 10 days ago and he called me up, he said about three and a half years ago he bought into a private business through his Roth ira and through, you know, private placement, I think he said he invested like $75,000 and now the company was going public and he 10x his investment. So he turned like 75 grand into over almost a million dollars tax free in a Roth ira.
So he was calling me to tell me like, thank you. I don't know if you remember me, but you, I called you and you helped me do this thing. And now I over 10x my, my investment, it's in a Roth IRA. So once I'm 59 and a half, I think he was like 56, it's all going to be tax free. And you know, thank you. And I was like, well, you're the smart one. I just kind of set this up for you. You're obviously a lot sm, so I always love hearing those types of stories.
[00:11:51] Speaker A: I love it. Hey, for the people out there who are not savvy with IRAs, can you just tell them what the difference is between a Roth IRA and a traditional IRA in terms of the taxes before and after? Sure.
[00:12:02] Speaker B: A traditional ira, you Get a tax deduction when you put the money in, which is great. But once you pull the money out after 59 and a half, you have to pay income tax on whatever you pull out. So if you have $100,000 in a traditional IRA and you're 65 and you want to take some money out to live off, you could have to pay income tax at your tax rate of what you pull out. Whereas a Roth IRA is the opposite. You don't get a tax deduction when you put the money in. But so long as you're over 59 and a half and the Roth has been open at least five years, you can pull anything you want. A tax free. Right. So the idea is you buy a Bitcoin for 2000 bucks when you're 50, 10 years later it's 60, sell it for 100,000 and you literally can just pull the money out tax free, live off.
[00:12:44] Speaker A: Beautiful, beautiful. Now can you transfer, if you have a traditional IRA already in place, can you transfer to a Roth ira?
[00:12:50] Speaker B: Absolutely. You can do what's called a Roth conversion. You just have to pay income tax and when you transfer from pre tax to Roth, but once it's in Roth, and then you have the confines and the protection of a potential tax free event.
[00:13:03] Speaker A: Okay, Beautiful, beautiful. Now it's helpful to know that kind of stuff. Most people aren't taught that when you go work in a, a company, nine, the nine to five type companies, you're. They say on a retirement fund, sure. Well, this is what we use. Boom, done. And people then they'll leave. You leave that job, you go to a different job. People don't know. They can take that out, put it, you know, put it into their own.
[00:13:23] Speaker B: Hey, Drew.
[00:13:24] Speaker A: Stuff we're not taught.
[00:13:25] Speaker B: I, I have a law degree. Okay. I have a master's in tax law. I work, I worked for eight years. Some of the largest law firms in the world. I had no idea you could do this stuff until I, I got lucky. I had a client that I was an 8th year lawyer in New York City at a big law firm and he wanted to use his IRA to invest in a hedge fund. Someone asked me to do the research. I had no idea. I never heard of a Roth IRA or IRA. No, I just did a 401k, no idea. Didn't take one class on this stuff. And I was blown away that you could do this. And changed my life.
[00:13:54] Speaker A: Yeah. And that's the biggest thing right now, is education. There are some people who know the information and don't want to share it. And then there are people who know the information and are sharing. I think more people are sharing it now. More people want to know what the 1% elite do in this country to protect themselves.
[00:14:09] Speaker B: This is what they're doing. Trust me.
[00:14:11] Speaker A: People don't.
[00:14:12] Speaker B: Yeah, people don't realize this is how the rich people get richer.
[00:14:16] Speaker A: Yeah, it's, it's true. And, but thank you for, for shedding light on that.
If there was one piece of advice you'd give to clients, just basic 101 when they are looking to invest, do you have anything you, you could, you're allowed to share?
[00:14:31] Speaker B: Yeah, I mean I, we don't, we don't promote investment. So we're totally neutral with the client. We help, help set up the self directed IRA and, and they get to invest in whatever they want essentially. So my advice to people is, in my experience, people tend to do better when they are interested in the actual investment. They generally make better decisions, have more focus on diligence and do better. So if you love real estate, you're probably going to do better in real estate if, than if someone didn't understand it versus if you love stocks. You're going to do research and learn more about the companies you're buying. You'll probably be better at stock investing.
[00:15:07] Speaker A: Okay, cool. All right, getting off topic a little bit, I want to ask a what if question, like a hypothetical. Let's say you did give up when your wife said fight.
[00:15:22] Speaker B: Yeah.
[00:15:23] Speaker A: What do you think? Where do you think you'd be right now?
[00:15:26] Speaker B: Oh, I'd be in a bad place.
I be super depressed because I spent 10 years building this, 12 years at that point building this business, putting everything I had into this business, literally all my savings.
So this is why it was such a traumatic event when that, you know, hack happened.
Yeah, she saved me. I don't know. I would have been in a bad dark place, I can tell you.
If I wasn't able to do what I love and I had to give up because of some, you know, some crazy event, criminal event that I had nothing to do with.
[00:15:59] Speaker A: Yeah, absolutely. Absolutely. What are some hobbies that you do outside of the business?
[00:16:06] Speaker B: Good question. I have two young kids, so I don't have time to do anything except there are 15 and 11, so.
[00:16:14] Speaker A: Right.
[00:16:14] Speaker B: Yeah. I, I spent my weekend, I spent with my kids. But honestly what I've been doing lately is if I have free time, I play around with AI.
I write a lot using AI. I do some coding. I'm trying to teach myself coding with AI so I'm really using AI to kind of do stuff that I just always want to do. Just never had the time to kind of find a teacher or take a course and I'm having AI do it for me and it's been a lot of fun.
[00:16:41] Speaker A: That's good. Hey, you know what? Every day we can learn something if we, if we put our minds to it. So that's really cool. So tell me about your two, your two children, boys, girls, two boys they love.
[00:16:52] Speaker B: You know, my, my 15 year old's a great cross country runner. He's one of the best in the state of Florida. Wow. But, you know, he's, he's injured now. He's dealing with some stuff, so. And my youngest one plays a little basketball, but he's too short, so, you know, probably not going to make the NBA.
[00:17:06] Speaker A: Come on, the growth spurt.
Thirteen, two years growth spurred, boom, done.
[00:17:11] Speaker B: I, I told him he should focus on owning the team versus playing in the NBA. He's got a better chance.
[00:17:17] Speaker A: And then if he owns the team, he can put himself in as a player owner. There we go. That's it.
[00:17:21] Speaker B: He can get on the back or be the GM like Jerry Jones and, you know, you can stay in the game.
[00:17:27] Speaker A: Oh, I love that. I love it. I love that. Anything that you want to share with the audience that we didn't touch on, it could be personal, professional, inspirational, anything.
[00:17:36] Speaker B: Yeah, I mean, I think the, the most, the, the most important learning lesson again is like you said, I think you nailed it. Drew is just like people come into your life at certain points and it doesn't mean that you have to stick with that person. I'm talking business, not obviously marital.
You don't have to stick with that person forever. And you're actually doing not only yourself and the company, the service, but actually that person. Because there's a couple people that I was working with that were, they kept getting promoted, promoted well above their skill set and they haven't been able to find a similar type job because they didn't have the skill set for it. So now they expect to make that type of money and have that type of role and no one else is hiring them. In fact, two of these people are still unemployed three, almost four years later because they're looking for a job they're not sued for, suited for. So if they stayed in the role they should have been in, and that was my fault, they would probably still be with me. Mike probably wouldn't have had this hack, and they probably have a longer career.
[00:18:41] Speaker A: And so it's a good thought. Absolutely. And then, yeah, disservice to them too. And they actually, you know, they're accountable for, for that in a sense too. You know, I know you may say you should have gotten rid of the, you know, change something or sooner, but you know what that the tool set you had at the time wasn't the tool set you have now. So they, they're accountable for their own, you know, behavior and their profession. And now they're out of work and I wonder if they are man number one, man number two or man number three with that something, something curious I'm thinking about.
So folks, you certainly captured the essence of Adam Bergman and you are going to want to get in touch with them even just to get to know him as a, as a person. But the definitely for the financial aspect of it. IRA financial.com, we have this on video and audio. So he's wearing a nice shirt that says Ira Financial. Just put a dot com.
[00:19:35] Speaker B: My uniform, I wear it every day. I love it.
[00:19:37] Speaker A: It's a nice uniform.
[00:19:38] Speaker B: It's easy.
[00:19:39] Speaker A: You wear it well. You wear it well.
So I got, I got a couple final questions for you. All right, so I'm gonna give you the opportunity. You're sitting in your happy place and you sitting down with 7 to 10 year old Adam Bergman and you want to give him advice about life. What are you going to tell him?
[00:19:58] Speaker B: Oh, it's a great question. So I would, I would, if I could, I'd go back and I'd say be even more curious, ask even more questions. Right. Whether you're seven years old, eight years old, the teacher tells you something, don't be shy if you don't understand something.
Question authority.
Respectfully, but question authority. Question what people tell you. Be curious. Learn as much as you can.
[00:20:20] Speaker A: Love that. Absolutely. All right, so now we'll switch gears. You're now sitting down with young entrepreneur, young businessman Adam Bergman. And what type of advice are you going to give him about business?
[00:20:31] Speaker B: I would say, okay, the number one, of course, is focus number one on the business and you from, from a loyalty standpoint, if the person, you know in your gut, that person doesn't have the skill set, even though you love that person, you're better off for both parties to kind of go in a different direction. Number two, I would say be prepared to work at least 10 plus years. Blood, sweat and tears. Anyone who tells you you're going to build something in less than 10 years that's worthwhile is lying to you, doesn't happen. You, you can't cheat this process. You can try to raise as much money.
People don't realize like Chat GPT, okay. Was founded in 2015. They didn't launch Chat GPT until 2022. Seven years. Okay. No one heard of OpenAI. So it takes time. Okay. And be patient. Don't, don't try to shortchange the process.
It's a journey. It's going to take 10 plus years to build something. Just know that that's great advice.
[00:21:28] Speaker A: Absolutely great advice. A lot of people are looking for that quick fix. And you know what they think people are successful overnight or companies are successful overnight. That example about OpenAI ChatGPT is an example of it's not overnight. There was blood, sweat and tears and work done.
[00:21:43] Speaker B: Seven years.
[00:21:44] Speaker A: Yeah, Absolutely. Well, Adam, I want to thank you for coming on. I want to thank you for coming into my life, my friend. Keep doing what you're doing and being the awesome human being you are. You're helping a lot of people out there because when you're helping them financially become financially healthy, you're also helping them become mentally, emotionally and cognitively healthy too. And the human being is needs to be a well rounded individual and, and you definitely are helping people become that.
[00:22:11] Speaker B: Thank you so much. It's really a pleasure talking with you. Thanks so much for having me.
[00:22:15] Speaker A: Absolutely. It's my pleasure.
Everybody out there, please take care of yourselves.
Thanks so much for listening. If you enjoyed the episode, please subscribe and give us a review to help others find it.
I'd like you to answer this question.
Are you living the life you want to live or are you living the life others want you to live? I'd like you to think about that for a second because I strongly suggest you live the life you want to live. If you want to learn more about what I stand for and my services and how I'm able to help many men get out of their own way, please go to my website at www.prophetcompassion.com.
feel free to also email me at drewfitcompassion.com I'd love to have a conversation with you.
Take care of yourself and choose to write your own story instead of letting others write it for you.
