ROBS 401K Funding: Costs, Risks, and Timing

Most people think ROBS means free money out of your retirement account with no strings attached. It's not that simple, and the part that gets left out of most explainer videos is exactly the part that gets buyers into trouble after closing. ROBS (Rollovers as Business Startups) is a real IRS recognised structure that lets you use retirement funds to buy a business or franchise, tax free and penalty free, without a bank involved. No credit checks, no debt service, no interest payments. But it comes with real setup requirements, real costs, and a risk most people don't think through before they commit. 💰 What ROBS actually is: a four step structure, form a C corp, set up a new 401k, roll your funds, buy company stock. Your retirement account ends up owning stock in your business, and that's what funds the deal. 📋 What it takes to qualify: most providers want at least $50K in retirement funds, a C corp specifically (not an LLC or S corp), and ongoing ERISA compliance. Setup runs around $5K plus roughly $150 a month for plan administration, and the whole process typically takes 3 to 4 weeks. ⚠️ The part nobody sugarcoats: your retirement account goes into one single undiversified bet, your own business. If it doesn't work out, that retirement money goes with it. The IRS also watches ROBS structures closely, so ongoing compliance isn't optional. 🔍 What ROBS covers vs what it leaves out: it's built to fund the purchase price or equity injection to close. What it doesn't cover is working capital once you're operating, the setup and admin costs, and the timing gap during that 3 to 4 week setup window before funds are actually available. 🔁 Where the 5 tool stack fits in: rapid gap funding bridges the timing gap while your ROBS structure is still being set up, so a deal doesn't stall waiting on paperwork. 0% credit card stacking covers setup costs, admin fees, and working capital, so those dollars aren't coming out of your retirement account. Result: less of your retirement at risk, not more, while you still get the full tax and penalty free access ROBS is built for. If you're considering ROBS for a business or franchise purchase, the next step is mapping out exactly where gap funding and stacking fit around it, so your retirement account isn't carrying the entire risk on its own. 📞 Book a call to map out your numbers → https://gapfunded.com/apply 🤝 Become a Gap Funded partner → https://gapfunded.com/partners ⏱️ TIMESTAMPS 0:00 – Intro: the ROBS misconception 1:00 – What ROBS actually is 2:00 – The four steps to set it up 3:00 – What it takes to qualify 4:00 – The part nobody sugarcoats: the real risk 5:00 – What ROBS covers vs what it leaves out 6:00 – Where the 5 tool stack fits in 7:00 – Mapping the gap funding and stacking around your deal 8:00 – Book a call and next steps #ROBSfunding #FranchiseFunding #businessacquisition #RetirementFunds #GapFunding #CreditStacking #SmallBusinessFunding #buyabusiness DISCLAIMER Mick Wadley is not a CPA, attorney, insurance agent, or contractor. Nothing here is tax, legal, or financial advice. Verify everything with a licensed professional before making decisions. This video is for education and entertainment purposes only.