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128 Bit Encryption

As well as raising security levels for people using insecure locations such as Wi-Fi hotspots, the company hopes the anonymity offered by VPN encryption will also be a draw.

Disk Encryption

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Real Estate 101 for Babyboomers

With the early Baby Boomer generation now reaching the age of retirement, many are unsure exactly how to use their investments in real estate, stocks and bonds to their advantage. Most people, in a perfect world would like to have enough money to do what they want to do, within reason, enjoy themselves, and leave something to their kids after they leave us. Of course, this sounds easy, but once you try and embark on a task like this, most people soon find that it is no easy task.

The goal of this site is to provide some information and ideas about how to use real estate as an investment vehicle to provide income, shelter income from taxes and help grow principal. Please note that the information found on this site is just that, information. Please consult with your real estate or tax professional before making any decisions regarding your investment portfolio.

Why Real Estate

There are two schools of thought out there. One says pay off your mortgage as soon as you can and you have made it. The other says, keep a mortgage as it keeps your cash available (provided you spend responsibly) and shelters income, even in your retirement years. What most people don't consider is that they will be paying taxes on their retirement income. The government never stops putting their hand out...no matter how old you are. So, it makes sense to consider not only your income, but the income tax ramifications of retirement and your investments.

Real estate is a great investment vehicle for long-term investors and provides advantages that no other investment vehicle does. First, a mortgage loan is the only tax deductable debt type available to consumers today. Second, over the long-term, real estate has provided steady appreciation on par or exceeding inflationary levels, keeping investment dollars safe and letting them grow (tax deferred in some cases). Third, most real estate investments are relatively liquid. Buy smart and there will always be a market for the property you buy when it comes time to sell it. Many expenses associated with real estate ownership are also tax deductable or provide you with a benefit on your taxes when it is time to sell. Of course, you can live in most real estate and that is a good thing.

What Types of Real Estate to Buy?

Of course, most people really don't know much about real estate. I was shocked to find out that my wife did not even know how to get a mortgage loan...even though she had one when I met her. While you don't have to be an expert educating yourself about the basics of real estate ownership and financing are critical to help you make sound financial decisions and not get ripped off. Education is really powerful and we should all make an effort to continually educate ourselves throughout our lifetimes.

Now that I am off my soap box, let's talk about the different types of real estate investment out there today. First, there is residential real estate. For the most part, this comprises single-family homes and multi-family homes with two to four units. Why? Well, it really has to do with the mortgage markets and Fannie Mae and Freddie Mac. But, that is outside of the scope of this discussion. Suffice it to say that the most attractive real estate financing is typically available on this property type to the average investor. The second type is commercial real estate. Commercial real estate is also categorized based on the type of real estate loans that are available. Commercial or small business banks typically make up the bread and butter of the financing of commercial real estate. There are many sophisticated loan products available to big-time commercial property owners (office buildings, large developments, high-end retail, etc), but, most of the properties have their loans done by small banks. Property types can be anything from office space, retail buildings, industrial properties, and multi-family properties with 5 or more units. Lastly, we have vacant land. Land is typically not a great investment vehicle when it comes to real estate investing. The reason is pretty simple. Most land takes a very long time to appreciate. While you are waiting around for appreciation, you are paying taxes and most land typically never generates any income. Let's leave that one for the developers and farmers.

Secure Property Types

Some property types are considered safer than others. With any property type, it is always a good idea to buy near a job source or metropolitan area. The reasoning is simple, jobs pay people and people need money to make mortgage payments or rent. If you buy a property in the middle of nowhere, once your tenant leaves (and they will leave at some point), you may have a very difficult time replacing them...feeding the property in the interim. For the reisdential properties, single family homes are probably the toughest to make any money with unless the market is undergoing a major expansion...rare. Multi-family properties typically can "cash flow" and pay all of the expenses, debt service (loan payments), and even put a little change in the kitty. This is a great way to go with residential property. On the commercial side, NNN properties (Triple Net Leased) are traditionally the safe haven of retirees and investors who want no management hassle. With a triple net leased property, the tenant(s) is(are) responsible to pay for all of the expenses on the property, including taxes. The check the owner receives each month on a true triple net leased property is all for them. One of the real advantages real estate investors have today is the myriad of loan products available to them. Years ago, commercial real estate loans were very expensive, even for the strongest and experienced borrowers. But, today, there are very low cost NNN loans available to borrowers with good credit. Commercial loans are however much more expensive to close with commercial MAI appraisals costing a small fortune and are required by most lenders. Also, there is typically less leverage (lower loan to value) available to commercial borrowers...but, this is changing. Many commercial lenders are now offering 30 year amortization schedules, interest only payments and no pre-payment penalties on many loan products. This can be a real benefit and give investors the ability to use less of their capital, more flexibility in their investment and lower their overall monthly "nut".

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