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

Due to their special tax status, REITs should follow rigorous compliance standards and thus carry a certain excellent standard for the vehicles investment plan 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 money, since it's traded openly on a stock exchange. But this liquidity is likely to be priced into the value of the shares, resulting in a liquidity premium, or a cost that most investors pay for the capability to get and sell the asset whenever they wish.

Furthermore, publicly-traded REITs tend to be connected 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 have become more popular, because of their potential double dividends. But, public non-traded REITs have recently come under heavy scrutiny because of the large upfront fees often charged to investorsand dubious practices around the disclosure of those fees.

In the last few decades, pioneering new programs like Fundrise have emerged. Fundrise intends to offer the benefits of private market accessibility, but with reduced fees that potentially help investors earn better returns. Leveraging technology and new national regulations, Fundrise offers investors that the very first ever diversified commercial real estate 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 part of the investment procedure is careful due diligence of each opportunity as it appears and working hard to remove any pre-existing biases. Take your time to determine which approach makes the best sense for you, and carefully compute your residual income goals.

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When looking at income in the future, shouldnt we be looking at what's going to happen and determine if that's what we want life to seem like We need to work backward from this point until we achieve today, 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're left, plus dividends and interest from your investments and maybe an income annuity will fulfill your needs and hopefully exceed them, and that means you can walk away from the day job.

Dividends and interest are a form of residual income. Social Security certainly go is, that the government takes money from us every 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 have 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 prior to taking our money before 59.5, wouldnt it be prudent to begin investing in resources of residual income now that maybe dont have an age limit into our 60s What guarantee do we have that we will 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 tech 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're at is indeed 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 actual definitions. Lets look at these . Residual Income is income that continues to be generated after the initial effort has been expended. Compare this to what most people focus on earning: linear income, that can be one-shot compensation check it out or payment in the kind of a commission, wage, commission or wages.

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