Valuable Tip of the Week

 You may have been told that Real Estate is a good investment.  Let's take a closer look.  Let's assume that you buy a piece of property for $300,000 and make a $100,000 down payment, pay $6,000 a year in property taxes, $6,000 a year in maintenance and $12,000 a year in interest payments.  You then sell the property in 2 years for $360,000 net minus $200,000 loan minus $148,000 of expenses (includes paying yourself back for the down payment) equals to a $12,000 profit, which is the same as a 6% return on your $100,000 per year that you may be able to get without the aggravation.  The point is that Real Estate can be a good investment but it may not be for everybody.  Maybe you should consider a REIT (Real Estate Investment Trust) instead?

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Please keep in mind that REITs are not suitable for all investors and are subject to certain risks including; potential absence of a public market for the security, limited transferability, lack of liquidity, and the possibility that there could be substantial delay before distributions are made.  Before investing in a REIT, you should carefully read its prospectus for a detailed discussion of the risks and suitability standards in your state.

 
Please be advised that this document is not intended as legal or tax advice. Accordingly, any tax information provided in this document is not intended or written to be used, and cannot be used, by any taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. The tax information was written to support the promotion or marketing of the transaction(s) or matter(s) addressed and you should seek advice based on your particular circumstances from an independent tax advisor.
 



SRF Wealth Management or its associates do not provide legal or tax advice.