How real estate investing is building a portfolio for financial independence

financialexpress.com:

As the world ventures into the post-pandemic epoch, the notion of financial independence is gathering momentum among individuals. This independence refers to having sufficient income to cover living expenses without being actively employed. While the avenues towards achieving this coveted status are diverse, real estate investing emerges as a potent contender.

The charm of real estate investing lies in its tangible nature. Unlike stocks or bonds, real estate is a physical asset that individuals can use, modify, and derive value from, creating a sense of security and control.

Asset appreciation is a principal benefit that comes with real estate investing. Over a period, the value of real estate tends to climb, despite the market’s ebbs and flows, thus enhancing an individual’s net worth. Moreover, in thriving markets, the appreciation can significantly surpass the initial investment, creating a lucrative avenue for wealth accumulation.

Also Read: Decoded: Loan-to-Value Ratio and Its Impact on Home Loan

Rental income is another robust stream that aids individuals on their journey towards financial independence. A consistent rental income can cover living expenses, allowing individuals to explore other pursuits without financial anxiety. Moreover, real estate properties often witness a rise in rental income over time, aligning well with or outpacing inflation rates.

Diversification is a mantra in the realm of financial planning. By allocating resources in real estate, individuals can achieve a balanced portfolio, which is essential for mitigating risks and navigating economic volatilities. Real estate often demonstrates a lower correlation with other investment classes, making it a stalwart for diversification.

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