REITs and Real Estate Mutual Funds Investing – Reinvest by: Robert Shumake

If you are investing your money into stocks, bonds, real estate mutual funds or other commodities on the stock market, what do you do when those dividend checks come in? Some of those investment checks can be sizable if you have a good year or a lot of stock. Do you hold a party? Buy yourself something nice for having made wise investments? Why not put that money back to work for you.

One mistake many new investors make is not allowing their money to continue to grow by reinvesting. While those dividends may not seem like a lot up front, they can add up quickly and grow if you put them back into the system.

Consider this. If you were to put $100,000 into a REIT or real estate mutual fund to purchase 100 shares and it sent out a 10% dividend check that would be a check for $10,000 the first year. You could either spend that and be back at the base of $100,000 or put it back into the system and have $110,00 in investments. The same 10% dividend the next year will make you $10,000 if you didn't reinvest or $11,000 if you did (not to mention a 10% larger investment portfolio). As the years go by this will continue to add and compound and if allowed to grow you will be pleased to see what long-term results will mean for your financial situation.

In order to see this at work, you need to know where to put your money. As we mentioned in the example, real estate mutual funds and REITs are very wise places to invest. There are a couple of reasons for this.

First is the fact that real estate investing is based on a tangible item – real estate. While values in real estate can change from day to day the fact that it is a physical asset makes it a wise investment.

The other reason that people like real estate mutual funds and especially REITs is that over the long term they tend to have very strong and stable growth. While most investments can fluctuate wildly from year to year, many REITs have a track record of a 6-12% dividend paid out to shareholders annually.

This is especially the case in REITs. The reason for this is the way that REITS are structured. As part of the legal basis of REITs they must pay out a certain amount of their profits (90%) to their shareholders.

Knowing you need to reinvest your money is just part of the battle. The next part is selecting wise stocks to put your money into. For this there is no better way than to do than research.

Log onto a site like REITBuyer.com. REITBuyer.com is the first and only online brokerage that specializes in REITs and real estate mutual funds. The site not only is a place where you can buy REITs and real estate mutual funds and watch your portfolio, but also it has news, education and research that you will be able to use to decide which investments are wise ones for you.

About The Author

Robert Shumake's mission is to inform the public about mortgage fraud and real estate scams and to provide tips on how to avoid being a victim. "Sometimes people will commit identity theft to obtain a housing loan, sell someone else's house or take over someone else's property," says Shumake. "It is my goal to inform the public on how to protect themselves from being victims of this crime."

http://reitbuyer.com