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In 1960, Congress passed a law creating Real Estate Investment Trusts (REITs), large portfolios of income-producing real estate 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.

Due to their particular tax status, REITs must follow strict compliance standards and therefore carry a certain excellent standard for both the vehicles investment plan 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, since it's traded openly on a stock exchange. However, this liquidity is very likely to be priced into the value of the shares, resulting in a liquidity premium, or a cost that most investors pay for the ability to buy and sell the advantage whenever they desire.

What's more, publicly-traded REITs tend to be correlated to broader market volatility, meaning that the share value may fluctuate depending on the way the stock market 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 more popular, because of their possible double-digit dividends. However, public non-traded REITs have recently come under heavy scrutiny because of 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 private market access, but with lower prices that potentially help investors earn superior returns. Leveraging technology and new federal regulations, Fundrise offers investors the first ever diversified commercial property investment portfolio accessible right online to anyone in the United States, no matter their net worth.

Regardless of which investment strategy you decide to pursue to earn residual income, an essential portion of the investment process is careful due diligence of every opportunity as it appears and working hard to eliminate any pre-existing biases. Take time to determine which strategy makes the best sense for you, and carefully compute your residual income objectives.

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Find out what's happening in Building Residual Income Meetup bands around the world and start meeting up with the ones near you.

When looking at income in the future, shouldnt we be looking at what is going to happen and determine whether that's what we want life to look 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 speak about residual income is the goal of retirement or what we like to call time liberty. .

When you retire, your Social Security income and pensions, if they're left, plus dividends and interest from your investments and maybe an income annuity will fulfill your needs and hopefully surpass them, so 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 each paycheck and we get a little piece back when we retire (even though it is taxed in retirement again).

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Consequently, if the objective is to get 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 start investing in resources of residual income now that perhaps dont have an age limitation into our 60s What guarantee do we have that we will make it that long.

Furthermore, what 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-level places we could 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 are at is so crucial. Are you currently doing one of those seven Dont be confused, not all businesses or investments are residual, in our own opinion.

Earning income has two real definitions. Lets look at these first. Residual Income is income which continues to look here be generated after the initial effort has been expended. Compare this to what most people focus on earning: linear income, that is one-shot compensation or payment in the kind of a commission, wage, commission or salary.

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