I always liked the saying, “If you fail to plan, you plan to fail.” However, even a decent financial plan can get clobbered by inflation, if you don’t diversify with investments beyond stocks, bonds, and mutual funds. While many of the best opportunities are only available to accredited investors, one well within reach for the average person is income-producing real estate. Do you currently have real estate assets in your investment portfolio? If not, you should!
Here are seven reasons why income-producing real estate is one of the best choices for protecting and growing your wealth:
1. Create positive cash flow
One of the biggest benefits is that tenant leases generally secure the assets. If you buy with cash at a value price, this provides an immediate, regular income stream significantly higher than almost any stock dividend yield. If you obtain a mortgage, the lease covers your repayment obligations while you hold the property for future capital gain.
2. Use leverage to multiply asset value
Speaking of mortgages, another important characteristic of real estate investing is the ability to leverage debt several times your equity. This allows you to buy more assets with less money, significantly multiply asset value, and increase equity as the loans are paid down.
In other words, if you have $100,000 to invest…