Can I make Investment Income?
Have you recently wondered about the ways to make investment income?
We know you have, and we have great news! Investment options are increasing in our market. Thanks to advanced technology and new government regulations, alternative investments are gaining ground for investors. As history shows us, we must not put all our eggs in one basket, especially when it comes to investments. That is why options are increasing for those looking to gain investment income from different investment opportunities.
“Diversifying your investment portfolio continues to prove itself as the smarter way to invest.”
What is investment income?
If you are wondering about investment income, you must understand what it is about. It is the income that you gain from different sources such as dividends, interest payments, capital gains, and any income made through different investment vehicles. It refers to the financial gains above the initial cost of investment. For example, the interest that you accumulate in a regular savings account is part of your income. The base for this income comes from the money that you deposit into your savings account. Thereafter, the interest you make on these deposits is known as investment income.
From your Savings Account to Residential and Commercial Investments
It was simple, and almost a no-brainer decision to open your savings account when you did. It was a smart idea and your bank account manager was right when he made the suggestion. As you can see on your bank statements, every month you make a little extra cash on the amounts you deposit into this account. Although little, every penny counts.
Nonetheless, if you want to take your investment income a few steps further, there are options available. Some of these are dividend stocks, peer-to-peer lending, index funds, and real estate.
How can I get investment income from real estate?
When it comes to long-term returns, real estate is still the preferred choice among investors and their advisers. Besides providing a sense of security for investors, Real Estate also provides 3 different ways to gain investment income:
1. Rental Properties
This option is great for those who own properties and are approved to rent them. On the downside, you usually need a 20% down payment of the rental property value when you purchase it. Thereafter, your mission is to find great renters to take care of your property and to pay for it as well. Owners see their rental property as a steady source of monthly investment income which in the long-term continues to gain value in the market.
It’s important to note that when you start renting your property yourself, you have the full responsibility for everything that could happen to the property. Some people back away from this option because of all the involvement required to manage a rental property. Companies such as Cedar Crest, from Denver, Colorado, are some of the new alternatives you have since they do not have realtor fees and they work with you in the terms you need.
2. Real Estate Investment trust, or REITs
These are another passive investment income source for those who are not interested in dealing first-hand with managing a property. It has many advantages. One of which is that they pay out 90% of their taxable income as dividends to investors. Nonetheless, dividends are subject to taxes as ordinary income. Depending on tax brackets, this condition affects some investors more than others. Consequently, some investors take this route with extreme precaution and care.
3. Real Estate Crowdfunding
These investments are as good as they get. They present a happy medium option for investors. With real estate crowdfunding, investors have the option to choose from equity or debt investments, and in some cases a good combination of them both. One of the advantages is that the investors get the tax advantage of direct ownership, includes depreciation deductions and investors don’t have the direct responsibility for the property (for more information, click here to learn about all the advantages in real estate crowdfunding).
Passive investment income sources have been and continue to be one of the most reliable ways to make passive income making your life easier in many ways. Once you set up your passive income sources, the possibilities are endless.
If you are looking for a company, you can trust with your investment income click here to gain exclusive access to pre-vetted investment options for you to start making investment income with higher returns.