Real Estate Investment Trust | Is REITs a Dependable Retirement Income for Physicians Instead of ETF? It is truly said by the businessman-cum-philanthropist Mr. John D. Rockefeller that land can make a fortune for all the American citizens. However, if you look through the perspective of a physician, the REITs investment, or Real Estate Investment Trusts and ETF stocks or Exchange Traded Funds stocks both will offer you lucrative ways to earn passive income in the post-retirement period.
There is also the REIT ETF available in the market. You as a physician-investor can enjoy both the REIT or Real Estate Investment Trust and ETF in one go.
In this article, the intention is to let you choose what you think will be your ideal retirement income, REIT, or ETF?
In the debate between ETF and REIT, we should start with the ETF. The ETF stocks include a variety of assets such as stocks, bonds, real estate, and commodities.
Though some people cannot make the difference between an ETF and a mutual fund but remember both are not the same. If you take the example of an ETF, the ETF is in trade-business throughout the trading day but a mutual fund is evaluated on the net asset value at the end of the trading day.
Usually, the term ‘throughout’ and ‘at the end of the day’ makes the difference between an ETF or Exchange-traded fund and a mutual fund.
Now, come to the primary point. There is a group of financial veterans who prefer ETF over Real Estate Investment Trust for the physicians. According to them, with an ETF you can customize your investment as per your risk-taking capability. This customize technique is not always possible with REITs.
That is why, the quantity of liquidity is comparably high on an ETF; barring public-listed REIT, you cannot always get that much liquidity in a non-listed Real Estate Investment Trust.
With the positive points, you can find some negative things in ETFs too. Sometimes, you may feel ETFs are too rigid and need to be a little bit more diversified. Apart from it, earning a dividend from ETFs is not always an easy task.
First of all, you need to find solid and stable companies that have the capability of paying dividends regularly at least quarterly.
With the positive points, you need to remember these negative points too that are attached to the ETF.
Hope you have understood about ETF. Now, take a look at how effective REIT is as a retirement income for physicians. Real Estate Investment Trust usually own or finance real estate that is usually income generated properties.
Remember, not everything is good about REITs investment. You should take care of 3 matters that you may consider negative about REIT.
A. Not all REITs provide you a high-yielding 90% dividend
The majority of Real Estate Investment Trusts who are going to provide you a high-yielding 90% dividend are usually public-listed. There is less chance of getting a high-yielding dividend with private-listed REITs or the non-listed REITs.
B. Growth and liquidity cannot always match upto your expectations
In REIT, sometimes it is 2 different worlds altogether. One is public-listed REITs to invest in and the other is non-listed and private-listed REITs.
With public-listed REITs to invest in, you can expect to get high growth and liquidity in the form of high-dividends.
But for private-Real Estate Investment Trust, do not expect to get such benefits and advantages all the time.
C. The tax rate is pretty higher
Another serious allegation over REIT is that it falls in the higher tax bracket if you are going to compare it with stock-dividends, ETF stocks, and other assets.
These are the 3 negative points you should analyze before going to invest in REITs.
If you are interested in REIT for your retirement savings then you must look after your debts too. Debts are your other barrier for retirement-purpose savings.
So, likewise you may take experts’ help to get valuable information related to REITs to invest in; there are also consultant firms available in the market to help you to solve your loan problem like the pdl.
The debt consultant firms can help you with valuable tips on how to solve your pdl loan problem with more than 300% interest rates. As you have read earlier, debts are never good for your retirement savings. Along with the expert firm, you can self-help with a settlement loan calculator on your pdl debts.
Think from the core of your heart. As a physician you may get more advantage with REIT as no other asset will give you such a high-yielding 90% dividend.
The statistics are also in favor of REIT stocks. REIT data says 87 million Americans own REIT stocks. So, the balance is slightly bent over REITs investment than on ETF stocks.
Now the choice is yours.
Author Bio: Catherine Burke is a financial writer for online payday loan consolidation. She provides information on successful cash loans and payday loan consolidation to help people get over a difficult patch. She lives in Kansas and has earned a frame in the matter of payday loans.
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