Why NY Retirees Should Consider Investment Real Estate
By: Barry E. Haimo, Esq.
January 27, 2022
You’re finally nearing your well-earned retirement and ready to enjoy it. Or perhaps you are already retired and taking advantage of life at a slower pace on your own terms.
But sometimes the fear of financial security still comes creeping into your mind: “Did I plan enough?” “Will I be secure with the funds I have?”
The truth is, it never hurts to have an extra stream of income no matter where you’re at in life. And a NY real estate investment could be the perfect passive way to pad out your nest egg or add to your portfolio of bonds, stocks, and alternative investments.
In addition to providing you with maximum buck for minimal management, a real estate investment can generate a stream of income that you can pass along to your loved ones as you plan your estate. At Haimo Law, our New York office is happy to help you with any questions you might have about buying or selling real estate – or, if you’re in Florida and would rather deal with someone local, we have relationships with people in the Sunshine State as well.
But how do you know which type of NY real estate investment is right for you? Let’s take a look at a few different types.
Which NY Real Estate Investment Option Is Right for You?
For retirees, a real estate investment that requires minimal hands-on effort and management responsibilities is ideal. That way you can reap the benefits financially, while still making the most of your retirement.
You also want to consider which option minimizes both risks and taxes.
Real estate investment trusts (or REITs) are publicly traded companies that own residential or commercial property. Think of them as the stocks and bonds of real estate investment.
Their income is paid to shareholders in the form of dividends, which means no real property management on your part.
The one downside? You have to pay capital gains tax when you sell, so it’s important to choose carefully.
Qualified Opportunity Zone Funds
The Tax Cuts and Jobs Act of 2017 created this type of private equity fund to boost real estate in struggling and underserved parts of the US. If you invest in real estate in one of these funds, you are reaping fiscal benefits and capital gains tax deferral while also helping areas in need.
But while that’s a win-win scenario, keep in mind that these funds often have set timelines for investment, meaning your assets can be locked in for up to a decade.
Third-Party Managed Investment
The goal in retirement real estate investment is to minimize the management aspects that often come with real estate holdings. That’s why a third-party managed investment can be a great choice.
While you would still have to be involved with the financials, a third-party management company can oversee the day-to-day of your property. No fixing washing machines and dealing with grouchy tenants.
The great benefit about rental properties is their surefire cash flow and tax deductions. Still, it is the most hands-on option here, so think long and hard before diving in.
We Can Help You to Plan Wisely
If NY real estate investment feels like the right fit for you, this list is only the beginning. Other popular investment options to consider include Delaware Statutory Trusts (DSTs), Tenants-In-Common Properties (TICs), and crowdfunding. Reach out to our New York office and let us help you find the right real estate option for you – get started by filling out this questionnaire for potential buyers.
Additionally, a crucial part of preparing for retirement and diversifying your portfolio is ensuring that all your hard-earned assets are protected and that you have planned for after you are gone. Haimo Law specializes in asset protection and estate planning, including creating a succession plan for how to handle your real assets. No matter what you’re dealing with, we can protect your family, assets, and business, so you can gain the peace of mind of knowing you’re prepared and in control.
Barry E. Haimo, Esq.
Strategic Planning With Purpose®
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