You’ve learned the fundamentals of REITs in Part 1 and how to evaluate different sectors in Part 2. But knowledge without action won’t generate a single dollar of passive income.
This final part bridges that gap. We’ll walk through exactly how to build a REIT portfolio from scratch, manage it effectively, and avoid the common mistakes that can derail your income strategy.
Step 1: Determine Your REIT Allocation
Before buying your first REIT unit, decide how much of your total portfolio should be allocated to this asset class.
Conservative approach (5-15%): For investors who want REIT exposure as a small income supplement to a diversified portfolio.
Moderate approach (15-25%): For those seeking meaningful income generation while maintaining broad diversification.
Income-focused approach (25-40%): For investors prioritizing steady cash flow, often those approaching or in retirement.
Important principle: REITs shouldn’t be your entire portfolio. They’re one asset class within a diversified investment strategy.
Step 2: The Importance of Diversification
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