Thread: Need tips on secure retirement investment!!!!

real estate is a good invest that keeps for a lifetime, you just need some knowledge on how to make things work out.

There is only really four ways of investing that make real sense for anyone that doesn't want to spend all their time sitting in front of a monitor observing market data.

1. Bonds-With bonds the average person and especially someone retiring should only buy bonds that have a AAA investment grade. Bonds are very safe investments but tend to have a low return. Despite this low return someone in retirement should have at least 20% of their assets in some sort of low cost bond mutual fund. The low cost mutual fund is suggested because you need to be deversified and these funds assure that. In addition any mutual fund that you choose should be a low cost fund that rarely trades so that your returns dont get eaten up in broker fees and taxes. A good example of the right kind of fund would be a Vangaurd Bond Fund.

2. Stocks-Stocks are a different kind of beast they can be very volitile and this is usually bad for someone in retirement. But over a ten year period they have posted excellent returns for the investor considering that if one invests in a index fund the investor has no demands on their time. I would not suggest greater than 10% of assets be in stocks for someone in retirement. This small amount is because of the volatility of the stock market. Someone in retirement needs to be able to access funds to live on this could crush their savings in a down period because they still have to sell even though they shouldn't. Assets that are invested in stocks should only be in index funds that rarely trade so that earning are not eaten up in brokerage fees and taxes.

3. REITs-This acronym stands for Real Estate Investment Trusts. These are fantastic investment vehicles for retirees. REITs have to pay out 90% of earnings in dividends to investors. So, they have both a stock like opportunity as the stock value rises but pay out large dividens. This makes it attractive for retirees because their nest egg can grow through appreciation while they recieve intermitent payments in the form of dividends. These dividends allow for consistent income thereby removing the troubles with stocks because the investor does not have to sell to recieve his/her income. Some may say hey stocks pay dividends also. And yes this is true but they dont pay out even close to the amount that REITs do. REITs have 3 times higher dividend payments on average compared to stocks. A good example of this is Medical Properties Trust which is traded on the New York Stock Exchange and has the stock ticker MPW. Right now this stock is trading where the annual dividend equals nearly 8% of the stock price. I would say that as much as 30% of a retirees assets should be in REITs. With those investing in medical properties being the best choices for future growth and stability of dividends.

4. Cash Flowing Rental Properties-Right now an excellent opportunity is available for purchasing real estate at prices that give as much as a 10% NOI without very much searching. A 10% return without counting any appreciation returns spells opportunity. One of the best things about taking part in this type of investment is that Real Estate performs very well during inflationary times. And anyone with a basic understanding of economics can see that we will be going into a period of higher than average inflation with the people of China and India starting to compete for goods that only the Western developed nations had before. This increase competition will spur inflation that could reach double digits. Furthermore a hedge against inflation will be more important than in the past because this time Federal Banks will have a difficult time queling demand created by the development of nations with massive population without creating an artificial depression. The reason why Real Estate does so well during inflationary times is that Real Estate itself is a commodity. Rentals are made from land, metals, wood, plastics and labor. All of these items will inflate in cost and so the structures built with them will increase in value because the costs of building new structures will be much much more expensive. Most people think that owning rental is time consuming and that they dont want to be a land lord because they dont want to handle calls from tenants demanding repairs. This scenario is easily avoided by highering a property management company. These companies will manage every day to day activity for just 10% of the monthly rental income. That means if they dont keep your properties rented and generating income they dont get paid.

Retiring with a good investment plan is a necessary step for making the rest of the life secure. You don’t need to take up multiple plans at a stretch as they will only block up your money. One of the best methods according to me is trust deeds. Smart investors pad up their financial security with realpropertyprofits.com trust deeds which is a secure investment by actual property – homes, buildings, or land. Hope this will help you in deciding your plan.

Happy Investing.

Real estate investing is a great option. Be sure to find a local mentor who can guide you through the process.