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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% of its earnings to investors every year. Now, an estimated 70 million Americans invest in REITs.

Due to their special tax status, REITs must follow rigorous compliance standards and therefore carry a certain quality standard for both the vehicles investment plan and the property experience of the managing team.

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

Furthermore, publicly-traded REITs tend to be connected to wider 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, because of their possible double-digit dividends. But, 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 those fees.

In the past few decades, pioneering new programs like Fundrise have emerged. Fundrise intends to offer the benefits of private market access, but with reduced fees that potentially help investors earn better returns. Leveraging technology and new federal regulations, Fundrise offers investors that the first ever diversified commercial real estate investment portfolio available directly online to anyone in the United States, no matter their net worth.

Irrespective of which investment plan you decide to pursue to earn residual income, an essential part of the investment procedure is careful due diligence of every 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 reach today, viewing our decisions with money as the pre-cursor i was reading this of tomorrow The reason we even speak about residual income is thats 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 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, that 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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So, if the objective is to get residual income when we retire, that 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 perhaps dont have an age limitation into our 60s What guarantee do we have that we'll make it long.

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

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

Earning income has two actual definitions. Lets look at those first. Residual Income is income which continues to be generated after the initial effort has been expended. Compare this to what most men and women concentrate on earning: linear income, which can be one-shot compensation or payment in the kind of a fee, wage, commission or salary.

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