From Short Notes to Long-Term Wealth: Diversify Your Portfolio with Real Estate

Do you want to build wealth through real estate? Short notes are passive real estate investments that can help diversify your portfolio and expedite your long-term goals. In this article, we’ll discuss short note investing and how it works, why it’s the perfect complement to turnkey rentals, and the role it plays in building long-term wealth. Keep reading to learn more!

Key Takeaways:

• Short notes are alternative investments that allow you to fund residential and commercial real estate projects and earn a return.

• With Connect Invest, you can buy a fraction of a portfolio of collateral-backed real estate loans with as little as $500.

• Connect Invest’s short notes have terms of 6 to 24 months and deliver annualized returns of 7.5%-9%.

• Short notes can provide additional cash flow, help with funding rental property down payments, diversify your portfolio, and mitigate risk.

The Importance of a Diversified Portfolio

Diversification is a strategy investors use to lower their risk and protect their portfolio against market volatility.

There are several ways to diversify your portfolio. You can diversify across markets by investing in the stock market and real estate, for example. You can also diversify your investments within the same market.

In real estate, using two complementary investing strategies, like short notes and Rent to Retirement’s turnkey properties, not only mitigates your portfolio risk but also helps you reach your long-term wealth-building goals. One investment gives you 100% passive, consistent monthly income, and the other gives you an appreciating asset that you can hold for the long haul.

The main benefits of a diversified portfolio include:

Less Volatility

Putting all your eggs in one basket makes you especially susceptible to market fluctuations. Spreading out your investments across different asset classes and investment types lowers your overall risk. If one market or asset fluctuates, it has a smaller impact on your portfolio. This allows you to recover from losses much faster and remain on track for your long-term financial goals.

More Consistent Returns

If you have a diversified portfolio, downswings are offset by upswings and vice versa. This means you’re likely to see smaller fluctuations within your portfolio, making it easier to forecast where your portfolio might stand 10, 20, or 50 years from now!

Short Term Real Estate Investing with Short Notes

Short notes are alternative real estate investments that are used to fund residential and commercial real estate projects. As the investor, you buy fractional shares of real estate securities and are paid back each month with interest—giving you a completely passive cash flow stream!

With Connect Invest, anyone can invest in short notes with as little as $500. You don’t need to be an accredited investor. The company offers three different investments, with terms ranging from 6 to 24 months and annualized returns of up to 9%.

These investments are already relatively liquid, given their short terms and defined exit dates. However, Connect Invest also gives eligible investors the option to withdraw their funds before maturity. Better yet, the platform has no account fees or hidden charges!

How It Works

Short note investing is seamless through Connect Invest. Follow these simple steps to get started:

1. Create your Connect Invest account and verify your identity.
2. Link your bank account and transfer funds to your wallet ($500 minimum).
3. Choose the portfolio(s) you want to invest in.

From there, you’ll be able to track your portfolio’s performance and receive monthly interest payments!

Why Short Notes?

Why should you choose these high-yield investments over other investing strategies? Consider the following benefits:

Predictable Income

A short note is one of the best short-term investments and a reliable way to earn passive income from real estate. You receive the same monthly interest payment for your entire term, giving you another reliable income stream.

Fixed-Rate Returns

Connect Invest’s short notes deliver fixed-rate returns of 7.5%, 8%, and 9%, depending on which investment you choose. That’s far higher than what bonds or high-yield savings accounts pay!

Low Market Volatility

Connect Invest’s portfolios are highly diversified, funding residential and commercial developers across over 55 cities and 14 states.

In the unlikely event that one borrower defaults, it only affects that property and has minimal impact on the portfolio (and no impact on your returns!). Additionally, since these are first-position, collateral-backed loans, Connect Invest’s loan originator is the first to recover funds.

Invest in short notes today with Connect Invest!

Building Long-Term Wealth with Rental Properties

Short-term investments give you immediate cash flow, but they don’t build long-term wealth on their own. Long-term investments, like rental properties, give investors three major benefits:

Cash Flow

Like short-term investments, rental properties can generate monthly cash flow—the money left over after all expenses are paid (including the mortgage).

Tax Benefits

By purchasing rental property, you’ll be able to claim depreciation, operating expenses, mortgage interest, and other tax deductions on your return.

Appreciation

Appreciation is the number one way investors build long-term wealth through real estate. When a property’s value increases, the investor can realize the gain by selling the property or tap into the equity to help grow their portfolio!

Why Short Notes and Rental Properties Work Together

Short notes offer several benefits that complement a rental property investing strategy:

Steady Income for Down Payments

You often need a 15%-25% down payment when buying rental property, but short notes require significantly less capital to get started. Connect Invest has a minimum investment requirement of just $500! These investments provide steady monthly income—income that you can set aside for your next rental property down payment.

Reduced Financial Pressure

Rental properties give you long-term appreciation and monthly rental income, but an unforeseen repair or expense could eat into your monthly cash flow. This is where short notes come in. You can use the short note’s predictable cash flow to help cover property-related expenses as they arise.

Risk Mitigation

Owning rental properties can help you build wealth through immediate cash flow and long-term appreciation, but they are riskier than some other real estate investments. You can mitigate some of this risk with a stable, passive investment like short notes. These investments deliver predictable monthly payments and fixed-rate returns!

Diversification

A rental property is a single piece of real estate. If something goes wrong with that property, the entire investment is affected. A short note funds a large portfolio of residential and commercial projects across several dozen cities!

Why Is It Important to Set Short-Term and Long-Term Wealth Goals?

Short-term and long-term investments go hand in hand and are both necessary for building long-term wealth.

Low-risk, short-term investments—like short notes—give you immediate returns and have quick turnarounds. While you don’t get the traditional benefits of owning property, you can use these short-term returns to bolster your slightly riskier, long-term investments—like rental properties—while you wait for them to mature.

Start Building Wealth by Pairing Short Notes with Turnkey Rentals!

Do you own (or want to own) turnkey rentals? Short notes could diversify your real estate portfolio, help you cover property expenses, or fund your next investment property down payment. Create your Connect Invest account today and make your money work harder for you!