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In 1960, Congress passed a law creating Real Estate Investment Trusts (REITs), large portfolios of income-producing property investments. A REIT is required by law to distribute 90% of its earnings to investors each year. Now, an estimated 70 million Americans invest in REITs.

On account of their special tax status, REITs should follow strict compliance standards and therefore carry a certain excellent standard for the vehicles investment strategy and the real estate experience of the managing team.

There are two key types of people REITs: traded and non-traded. Publicly-traded REITs offer the benefits of money, because it is traded openly on a stock exchange. However, this liquidity is very likely to be priced into the worth of these stocks, resulting in a liquidity premium, or a cost that all investors pay for the ability to buy and sell the asset whenever they wish.

Furthermore, publicly-traded REITs tend to be correlated to wider market volatility, meaning that the share value may fluctuate depending on the way the stock market is doing, regardless of whether or not anything has changed with all the underlying properties owned by the REIT. .

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On the other hand, public non-traded REITs are becoming popular, because of their potential double dividends. But, public non-traded REITs have recently come under heavy scrutiny due to the large upfront fees often charged to investorsand dubious practices around the disclosure of these fees.

In the past few years, pioneering new platforms such as Fundrise have emerged. Fundrise aims to offer you the benefits of private market accessibility, but with lower prices that potentially assist investors earn better returns. Leveraging technology and new national regulations, Fundrise provides investors the very first ever diversified commercial property investment portfolio accessible directly online to anyone in the United States, no matter their net worth.

Regardless of which investment plan you opt to pursue to earn residual income, an essential part of the investment process is careful due diligence of each opportunity as it arises and working hard to eliminate any pre-existing biases. Take time to determine which approach makes the most sense for you, and carefully compute your residual income objectives.

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When looking at income in the long run, shouldnt we be looking at what is going to happen and determine whether that is what we want life to seem like We need to image source work backward from that point until we reach now, viewing our decisions with money as the pre-cursor of tomorrow The reason we even speak about residual income is thats the goal of retirement or what we prefer to call time liberty. .

When you retire, your Social Security income plus pensions, if they are left, and dividends and interest off of your investments and maybe an income annuity will meet your needs and hopefully exceed them, and that means that you can walk away from your day job.

Dividends and interest are a form of residual income. Social Security certainly is, the government takes money from us each paycheck and we receive a little piece back when we retire (even though it is taxed in retirement again).

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Consequently, if the goal is to get residual income when we retire, which appears based on Social Security rules to only be possible in our 60s, and the government has mandated penalties before taking our money before 59.5, wouldnt it be prudent to begin investing in sources of residual income now that perhaps dont have an age limitation into our 60s What guarantee do we have that we will make it long.

Additionally, what why not try these out control do we really have over Social Security and our 401Ks Looking at the sources of residual income, lets have a peek at other high tech places we can diversify. Who knows, maybe you could start generating residual income now and step into that time freedom sooner than your 60s.

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Taking stock of where you're at is indeed crucial. Are you currently doing one of those seven Dont be confused, not all businesses or investments are remaining, in our opinion.

Earning income has two real definitions. Lets look at those . Residual Income is income which continues to be generated following the initial effort has been expended. Compare this to what most men and women focus on earning: linear income, that can be one-shot compensation or payment in the form of a fee, wage, commission or salary.

We think that income that exceeds your expenses is named PROFIT! So, we're going to use the first definition for the sake of this document. .