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In 1960, Congress passed a law creating Real Estate Investment Trusts (REITs), large portfolios of income-producing property investments. A REIT is required by law to distribute 90 percent of its earnings to investors every 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 quality standard for both the vehicles investment strategy and the property experience of the managing team.

There are two primary kinds of people REITs: traded and non-traded. Publicly-traded REITs offer the benefits of liquidity, since it's traded openly on a stock exchange. But this liquidity is likely to be priced into the value of these stocks, resulting in a liquidity premium, or a cost that all investors pay for the capability 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, because of their possible double-digit 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 last couple of years, pioneering new platforms like Fundrise have emerged. Fundrise aims to offer the benefits of personal market access, but with lower prices that potentially help investors earn better returns. Leveraging technology and new federal regulations, Fundrise provides investors that the very first ever diversified commercial real estate investment portfolio available 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 procedure is careful due diligence of every opportunity as it arises and working hard to remove any pre-existing biases. Take your time to figure out which approach makes the best 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 get started meeting up with the ones near you.

When looking at income in the future, shouldnt we be looking at what is going to happen and determine if that is 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 aim of retirement or what we like to call time freedom. .

When you retire, your Social Security income and pensions, if they are left, plus dividends and interest off of your investments and perhaps an income annuity will fulfill your needs and hopefully surpass them, and that means that you can walk away from your day job.

Dividends and interest are a form 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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So, if the goal is to get 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 start investing in resources of residual income now that maybe dont have an age limit into our 60s What guarantee do we have that we'll 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 take a peek at other high tech places we could more tips here 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 stock 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 opinion.

Residual income has two real definitions. Lets look at those . Residual Income is income that continues to be generated after the initial effort has been expended. Compare this to what the majority of people focus on earning: linear income, that is one-shot compensation or payment in the form of a fee, wage, next page 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. .