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

Due to their particular tax status, REITs must follow strict compliance standards and therefore carry a certain excellent standard for the vehicles investment strategy and the property experience of the managing team.

There are two primary kinds of people REITs: traded and non-traded. Publicly-traded REITs give the benefits of liquidity, because it is traded openly on a stock exchange. But this liquidity is likely to be priced into the worth of these shares, resulting in a liquidity premium, or a price that most investors pay for the ability to get and sell the advantage whenever they wish.

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

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On the other hand, public non-traded REITs are becoming popular, due to 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 questionable practices around the disclosure of these fees.

In the last few years, pioneering new platforms like Fundrise have emerged. Fundrise intends to offer you the benefits of personal market accessibility, but with reduced prices that potentially help investors earn better returns. Leveraging technology and new federal regulations, Fundrise offers investors that the very first ever diversified commercial property investment portfolio available right online to anyone in the United States, no matter their net worth.

Irrespective of which investment strategy you opt to pursue to earn residual income, an essential portion of the investment process is careful due diligence of each opportunity as it appears and working hard to eliminate any pre-existing biases. Take your time to determine which strategy makes the most sense for youpersonally, and carefully compute your residual income goals.

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

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

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

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Consequently, if the goal is to have residual income when we retire, that seems 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'll make it that long.

Additionally, what control do we really have over Social Security and our 401Ks Looking at the origins of residual income, lets have a peek at other high-level places we can diversify. Who knows, maybe you could start generating residual income now and step into that time independence sooner than your 60s.

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

Earning income has two actual definitions. Lets look at those . Residual Income is income that continues to be generated following the initial effort has been expended. Compare this to what the majority of people concentrate on earning: linear income, which can be one-shot compensation or payment in the form of a fee, wage, commission or wages.

We believe that income that exceeds your expenses is named PROFIT! Thus, we are going to use the first definition for the sake of this document. .