So many in the world of finance have seen lackluster returns from investments over the last 10 years. For those who retired years ago or have years yet to make up the difference, this hiccup will hopefully have had a negligible effect. For those nearing retirement age or just having retired, to have seen portfolio’s stagnate has been particularly painful. Many investors have actually lost overall value in the past 10 years as they continued to pump new money into their accounts. For the retiree the need for security is there. With so much uncertainty in the markets today now may be the perfect time to get involved with real estate. With cash flow investing savvy investors are able to capitalize on the similarly weak housing market in lieu of tried-and-true standbys.
What is Cash Flow Investing- Cash flow investing gives investors a steady stream of income month after month. Because rental properties have rent coming due each month, many people have chosen to finance their retirement with the outright purchase of deeply discounted residential properties.
Rental vs. 401K/IRA- For so many years we have all been led like sheep with the promise of the market’s overall returns. While market returns may be okay for someone who’s just born and been gifted some kind of regular-investment IRA account from grandfather, for another man of grandfatherly age who’s relying on that income the truth is far different. Imagine if you had invested in some rental property in the 1980’s; before or just during the housing explosion in America. Now imagine if you had this piece of property pulling in a steady stream of hundreds or thousands of dollars; every month over the last 10 years. While your IRA or 401 K may have the same or lower value than it did 10 years ago, you could have been making money over the same time period and you’d still own the property’s deed.
Market Conditions Demand Attention- While you may read this and think that you missed the boat on rental properties, that’s not true. If you have $200,000 sitting in a stagnant IRA right now and you were to pull that money out and buy one or more single family properties, you could begin making money on that investment almost immediately. Home prices are way down; home building is limping because people aren’t buying as much as they did. With no immediate signs for housing recovery renting out a single family home you’ve bought is a really smart move. The bonus in this being that whenever you’re done as landlord you can still sell the property. It is true that home values could continue to fall. If you own a home for 5 or 10 years you could sell and break-even. The only caveat being all that additional rental income you’ve brought in. With all these things in mind there’s never been a more ideal time to invest in homes for rental income than right now.
If you’re tired of schemes and you want some real growth to your portfolio there may be nothing better for you than a piece of residential rental property. Not only do you get that monthly income from rentals but you will also have the security of knowing you’re going to be getting a windfall when you sell the property down the line.
Your retirement years may be right around the corner. Are you going to be like other seniors and be forced to work for a living for supplemental income? Or are you going to get smart and embrace the concept of cash flow investing in real estate markets?