Friday, February 27, 2009

REITs - Asset Backed Investments

Real Estate Investing For Retirement

Many people today are employed by themselves or small companies that just don’t have any sort of retirement plan. If you are one of these people, what have you done to make sure you are able to take care of yourself in your older years? Unfortunately for many people the answer is nothing. They don’t know where to begin or they have seen someone else lose everything in the stock market and are in fear of that type of investment.

While you may think that all stocks, bonds, mutual funds and everything connected to the market is evil these days, there are some investing avenues that will be there for you and can even help you see a healthy profit on your investments.

In this case we are talking REITs. A REIT is a real estate investment trust. This is essentially a holding company that uses the money from shareholders to purchase or manage real estate interests. Whether it's mortgage brokering or store and apartment complex purchasing, the money that comes in as interest payment or profits from the real estate holdings is then returned to the investors in the form of a dividend.

Traditionally, REITs pull in a 6-10% dividend annually. Some investors turn away from this type of return saying it's not enough to warrant putting their money in these accounts, but if you are working towards retirement, you need to look at this differently.

Unlike stocks, your REITs may not see massive gains in a year, although sometimes they do. Also unlike your stocks, your REIT investment is not going to disappear. While REITs can lose value, since they are property holdings, and property always has some value, they will not disappear completely taking your money with them.

Meanwhile, a return of 6-10% a year on a regular amount of money being put into a REIT will help you put aside a healthy little nest egg. It is a better savings option than you would get by putting your money in a bank or other secured interest possibility, while still being a pretty stable and steady investment that is not likely to go away.

If you keep putting your dividends right back into the investments, you may be surprised at just how fast your money will grow. While it is a long-term investment, in time you will be pleased with the returns.

Once you're ready to learn more about REITs it's time to do your research. This begins on is a website that specializes in REITs. They are not only an information source, but also an investing real estate broker. That means they are the pros in this arena and can not only help you learn more about these types of investments, but also offer you the tools and research you need to make wise purchases and even let you make those purchases online.

There is no time like the present to begin your retirement fund. REITs are wise long-term investments that can help your fund see the money it needs when you get to retirement age.

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