U-Haul Investors Club

Another Nest for Some of Your Eggs

Here’s a very simple way I’ve used for years to Earn around 5.3% or more Tax Free and safely, in a vehicle that will historically likely enjoy rates higher than CD’s especially when rates drop again. (Please note that*nothing here is financial advice. You must always do your own due dilligence*)

Accounts can be set up for regular investment accounts and IRAs, including ROTH IRA’s (a personal favorite)

Even the most aggressive growth investor needs a pot of “safe money”, if only to build dry powder for taking advantage of once a decade sell-offs in gold, stocks, real estate, or simply to provide assurance so that they don’t freak out on normal market corrections, panic, and upset their carefully constructed wealth building plans.

-Changa

Joining U-Haul Investors Club^® is easy and free! To get started follow this link

(full disclosure: It’s the same link I got from the friend who introduced me to this program years back. It may still give him a small incentive for new accounts (not sure), which costs you nothing.)
https://www.uhaulinvestorsclub.com/ReferAFriend/Invitation/b0e368eb-d030-40a8-b243-facb3d8114ff

U-Haul Investors Club

Years ago, after reviewing multiple options and after reading an article in Barron's, I decided to place some funds in the U-Haul Investors Club. You can find a wealth of information on its website (click here).

In order to feel comfortable with this investment, I did need to understand how the product would work. A simple explanation of the plan is shown below:

Source: U-Haul Investors Club website

With traditional investing, corporate bond obligations are expensive to issue, and there are normally fees paid to bankers. In addition, there are often mark-ups to retail investors which in effect provide a smaller yield to investors. Amerco (NYSE:UHAL) is the parent company of U-Haul and decided a few years ago to take a unique approach to corporate debt obligations. Instead of paying multiple level of fees to different parties, it offers obligations directly to the general public with no fees. It is an interesting approach to financing needs, and I am hopeful there will be more companies offering plans like this in the future. Its website is very informational and has a great Frequently Asked Question (FAQ) area. The investment you purchase with it is called a U-Note.

The following is excerpted from a seekingalpha article found here https://seekingalpha.com/article/4180339-early-retirement-planning-stable-income-u-haul-investors-club

What Exactly is a U-Note?

A U-Note is a collateralized debt security issued by Amerco, a Nevada corporation. All U-Notes are full recourse to the issuer. Therefore, the debt is secured by collateral and also has the guarantee of the parent company. This collateral can be trailers, trucks, real estate, or equipment. It should be noted that Amerco owns the real estate for many of its rental locations.

There are various types of U-Notes available at any given time, and normally, there are about four or five different issues. These notes have varying maturity dates and interest rates. Generally speaking, the longer the obligation, the higher the interest rate. Currently, rates range from around 5.13% on a two-year note to 7.25% on a 25-year note. (Personally, I like the 5-7 year range at around 5.5% as you will get both principle and interest paid back to you quarterly which you can reinvest in more notes in the same account. If rates drop, you’ll have a cushion, and if rates rise from here you’ll have enough coming back to reinvest higher and take advantage of locking in higher long term yields.)

At the present time, you can invest in a U-Note that has a five-year maturity, is secured by new tow dollies (which hold their value for 15-20 years as Uhaul makes them heavy duty in their own manufacturing facilities), and has an interest rate of 5.25%. The unique thing about these notes is they work exactly like a car or mortgage loan from the bank - payments of principal and interest are made on a quarterly basis. In effect, the individual investor becomes the bank to Amerco.

This investment is not guaranteed by the FDIC, and you are lending money to Amerco. Also, you are not able to “trade” your U-Note, and there is no secondary market for these notes. Investors must be willing to hold each note until maturity. You will see quarterly or monthly interest collect in the account which can be reinvested or taken out each time it reaches $100 minimum.

While Amerco is currently in good financial shape, there is no guarantee of future financial results.

Plus, there is always the potential of a leveraged buyout of the company in the future which could impact the credit quality of these investments.

With some of these risks being noted, this investment idea is only for long-term investors who are able to have their investment funds tied up for the period of the loan.

That said, I have personally interviewed several local managers, state and regional heads and even a member of the original owner family, and all of them underscored the fact that no one else really does what UHaul does in terms of size, scope, and various services. They run a tight ship, with methods and knowledge based on decades of real world experience. During tough times, like the plandemic, they boomed, so they have a business cycle uncorrelated to most other giant businesses. That’s good.

The U-Haul Investors Club appears to be a good investment for individuals looking for long-term stable income and is an attractive alternative to an annuity. It has a fantastic website that is very user friendly and informative. Accounts can be set up for regular investment accounts and IRAs, including ROTH IRA’s. U-Haul has been in business since 1945 and it has a good management team with decades of solid financial performance. A link to its most recent quarterly financial report can be found here.

Joining U-Haul Investors Club^® is easy and free! To get started follow this link:
https://www.uhaulinvestorsclub.com/ReferAFriend/Invitation/b0e368eb-d030-40a8-b243-facb3d8114ff