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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. Today, an estimated 70 million Americans invest in REITs.

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

There are two primary types of public REITs: traded and non-traded. Publicly-traded REITs offer the benefits of money, because it is traded openly on a stock exchange. But this liquidity is very likely to be priced into the value 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 desire.

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 the underlying properties owned by the REIT. .

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On the other hand, public non-traded REITs have become more popular, due to 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 these fees.

In the last few decades, pioneering new platforms like Fundrise have emerged. Fundrise intends to offer the benefits of personal market access, but with reduced prices that potentially help investors earn superior returns. Leveraging technology and new federal regulations, Fundrise provides investors that the 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 portion of the investment process is careful due diligence of every opportunity as it arises and working hard to eliminate any pre-existing biases. Take your time to figure out which strategy makes the best sense for youpersonally, and carefully calculate your residual income objectives.

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When looking at income in the future, shouldnt we're 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 reach now, viewing our decisions with money as the pre-cursor of tomorrow The reason we even speak about residual income is the aim of retirement or what we like 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 perhaps an income annuity will meet your needs and hopefully surpass 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 each paycheck and we receive a small piece back when we retire (even though it is taxed in retirement again).

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So, if the objective is to have residual income when we retire, which seems 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 sources of residual income now that maybe dont have an age limitation into our 60s What guarantee do we have that we'll click reference make it long.

Additionally, what control do we really have over Social Security and our 401Ks Looking at the origins of residual income, lets take a look at other high-level places we can diversify. Who knows, perhaps you could begin 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 indeed crucial. Are you currently doing one of these seven Dont be confused, not all businesses or investments are residual, in our opinion.

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