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Smart Real Estate Investing For Retirees

By Elizabeth R. Elstien

Retirees still need to make money, whether to live on during retirement, save for emergencies or to pass on to family. For those with the resources, real estate may be a good investment for the latter years. Here, I'll look at why real estate investing makes sense for retirees along with some sound investment tips.

For those with only stocks, diversifying the investment portfolio with the addition of real estate makes it stronger. It also leaves something to pass on to family. Some investment options include multifamily housing; buying, remodeling and selling homes (flipping) and commercial-office or retail.

Considerations

There are different considerations when purchasing investment property during retirement. A wrong investment for a retiree is financially devastating, potentially pulling from other crucial investments. A wrong investment at 30-years old, while still disastrous, leaves years for recovery. Age and health also factor in, as retirees may not have the stamina to put into a time-consuming investment, such as a large multifamily property.

Time Frame

When researching an investment property, consider the time frame for liquidity and financial recovery. Retirees will want an investment that pays off in the short- rather than the long- term. Waiting too long to recoup costs is not advantageous when retired.

Investment Tips for Retirees

As retirees have different needs than younger investors, here are some tips to ensure a successful investment.

  • have a solid real estate investing plan before you search for properties
  • purchase only liquid investments, ones where the expenses are recouped in little time
  • consult with a real estate investment expert if you lack property investment experience
  • look for a low-risk investment property
  • consider 2- to 3-unit multifamily purchases where you, as the owner, live in one unit to lower down payment cost and save on taxes
  • partner with another investor for larger purchases to split initial cash outlay
  • be patient, as it takes a little time to see the benefits of the investment
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About The Author

Elizabeth R. Elstien has worked in real estate for over 15 years as a real estate...

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