Alternative Investments


Simple investment growth is not enough as you move from the accumulation phase to the distribution phase of your life. No matter how much you have saved away, during retirement, generating reliable income streams to provide you with the means to live on is the most immediately pressing goal. In that regard, alternative investments can be a part of your income solution.

Alternative investments typically have a low correlation with those of standard asset classes, which makes them suitable for portfolio diversification. In addition, Real Estate Investment Trusts (REITs) are required by law to maintain dividend payout ratios of at least 90%, making them a favorite for income-seeking investors. REITs can deduct these dividends and avoid most or all tax liabilities, though investors still pay income tax on the payouts they receive. Many REITs have dividend reinvestment plans (DRIPs), allowing returns to compound over time. However, REITs and other types of alternative investments are more complex than traditional investment vehicles; they often have higher fees associated with them and they're more volatile than traditional investments such as stocks, bonds and mutual funds. The majority are invested in illiquid investments, making them difficult to exit and price on a regular basis.

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Blackstone REIT (BREIT)

BREIT is a non-traded REIT focused on investing in primarily stabilized commercial real estate properties diversified by sector with a focus on providing current income to investors. BREIT's allocation model targets at least 80% to properties and up to 20% to real estate debt securities, cash and/or cash equivalents.

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