How does real estate fit into your retirement portfolio? When looking at retirement, people look at stocks, real estate, social security, pensions, and other forms of income. They will be actively working and earning an income.
Some people enjoy owning tangible property; it’s something they can physically have. It can be any actual item with value, including rental units hosting tenants. Case being, for those who like physical assets, real estate is an excellent option.
You can generate passive income in retirement with real estate since living costs continue to go up. Your tenants are paying you rent, and those rents also go up. If someone has an excellent tenant, they might decide to keep rent stable. They may not want to increase prices too much, but over time gradually, it will grow.
Living off social security is near impossible if you’re in a state where the cost of living is high. Social Security isn’t enough to cover monthly expenses. However, if you own a property where tenants are paying rent, you’ve created a passive income source to support your retirement.
I have met many people that say, “I have this property. I want to sell it and take off to Mexico.” You have the option of selling off your property entirely; it doesn’t have to be where you continue to manage the property.
When you have real estate as part of your rental properties, it would be beneficial to have a solid property management team. It’s a personal choice if you’d like to manage and maintain that property yourself actively or for a fee, pass that to somebody who’s an expert.
Getting a team together may be worth looking into, as it allows you to enjoy your retirement. Figure out for yourself if it’s worth that percentage fee; however, having a team takes that responsibility away from you in return.
Having a property manager, especially if you’re in retirement, can effectively mitigate the stress of owning rental property. Some people are fearful of getting into real estate because of the stress of managing tenants and maintenance.
Suppose you can get a solid team together with a property manager who knows what they’re doing. In that case, you won’t have to get involved with evictions or maintenance issues. Instead, they’ll be responsible for that task.
Equally as important to have on your team are accountants and CPAs. They’ll be knowledgeable on the tax code in your state and be able to advise you on how to use your money effectively. Along with attorneys to assist in avoiding litigation or to help you proceed with litigation if that is what would be needed.
Before you move and sell that property and go to Mexico, make sure that you have spoken with your legal team and received their advice. Selling a property could cause a significant taxable event, so make sure you’re protecting yourself the best you can.
Additionally, when owning real estate in other states, having a team that understands the law and tax code in that specific state will prove to be crucial. Many different scenarios could play out in which having that legal advice is vital.
Mike’s 2￠: Selling Without A Realtor
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