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

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

There are two primary types 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 very likely to be priced into the worth of the stocks, resulting in a liquidity premium, or a price that most investors pay for the ability to buy and sell the asset whenever they desire.

What's more, publicly-traded REITs tend to be connected to wider market volatility, meaning that the share value may fluctuate depending on how the stock exchange is doing, irrespective 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 have become more 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 those fees.

In the past couple of years, pioneering new platforms like Fundrise have emerged. Fundrise aims to offer you the benefits of private market accessibility, but with lower fees that potentially help investors earn better returns. Leveraging technology and new national 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 strategy you decide 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 remove 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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Find out what's happening in Building Residual Income Meetup groups around the world and start meeting up with the ones near you.

When looking at income in the long run, shouldnt we be looking at what is going to happen and determine if that is 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 and pensions, if they're left, plus dividends and interest off of your investments and maybe an income annuity will meet your needs and hopefully exceed them, and that means you can walk away from your 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 objective is to have residual income when we retire, that appears based on Social Security rules to only be possible in our 60s, and the government has mandated article source 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 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 look at other high tech places we could diversify. Who knows, perhaps you could begin generating residual income now and step into that time independence sooner than your 60s.

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Taking inventory of where you are 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 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, which can be one-shot compensation or payment in the kind of a fee, wage, commission or salary.

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