re: $25,000 to invest. Where to put it?

My goal is to have 30k in dividend income a year by the time I retire. I'm only 24, but my income won't go very high most likely.

Iraqi dinar

I"d research the following if I were you:

COTY
GME
CRM
CNC
VOL
BEAV

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I've considered that, I'm not too keen on the idea of being a landlord. I'll look into it

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you do not have to be a landlord. You can use a property manager and still have great PCF. It does not have to be local either. Depends on the market you want to invest in. Many cities are different. Look up the top 10 cities in the US to own rental property. That will get you started if you are in a bad market where you live or if it is tough to get PCF.

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Not OT responses please. No hookers and blow. Give me a few stocks.

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I would tell you that, seriously, most research suggests that you should invest in yourself, i.e. experiences. If you have put off vacations for a while, that would be a good use for perhaps as much as $3k to $4k of this money.

However, as to your point, have you read any of TheBigFella's research on Visa? I would just buy 100 shares of that, if I were in your position.

While you usually can't go wrong with large-cap dividend payers, a case can be made that the last few years of extremely low interest rates have made them a pricey acquisition. Personally, I'd look elsewhere.

Try VXF, the Vanguard Extended Market ETF. Indexes against virtually all US regularly traded stocks EXCEPT those in the S&P 500. I'm of the opinion that if this rally is going to continue, it will do so on the backs of the small-caps and/or growth oriented companies. Here is the Vanguard link. LINK

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You do not have the potential for large gains, short and mid term like small and mid caps, BUT, taking the risk down to such a level that, in time, you get those gains at the end.
Am I making any sense?

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No, not really.

It's not the same return if you have to wait longer.

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I've wondered that. The property manager will do literally everything, to where you don't even have to live in the same state?

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yup....and contrary to popular belief.............

killer cash flow!

No different than a job, you have to go where the money is and where the best deals are.

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Fat Bastard, I didn't want to start another thread to ask this, but in your opinion in real estate is it better to go after big dollar deals or is it better at the bottom?

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On the theory side, you go with the axiom - you make your money in real estate when you buy, rather than sell. What that means is - if you can get the property at a discount, because the property or neighborhood is distressed or the seller is motivated, etc., that's the decision that makes you money. The closer you pay to market value, the longer it will take to recoup your investment, even if it was a quality purchase that rises in value. Also, the closer you pay to market value, strongly implies the less rehabilitation you have to do.

Now, why is this important when we're talking about rentals? Well, all other things being the same, your rental rates will track very closely to the appraised value of the property.

Now, having said that, there are pros and cons of each approach. The shotgun gives you a big buffer against fluctuations in demand for real estate. However, all of those transactions cost about the same, so you if go 4 or 10 instead of 1, you're increasing the cost of doing business.

On the other hand, if somebody can afford to rent a $500k house, they can definitely afford to buy. You will have far, far more potential renters in properties say, under $75k in most markets (in the Southeast, outside of speciality markets), than you will above $250k. Low income renters have a reputation for being a headache (especially when the rent is due), but high end renters are also very particular and can generate a high rate of complaints, etc.

Ideally a handful of mid-to-high tenants would allow you to focus on other things. The more total units (regardless of value), the more you will have to work them, even with a property manager handling day-to-day stuff.

If you want the truth? In Louisiana, trailer parks are a better way to go, from a pure profit margin. Once it is set up, pretty much zilch maintenance (a little grass cutting/weed eating), and if they don't pay, you just haul their trailer out. While the average joe may have trouble coming up with $450 or $500 - everybody can pony up $75 or $100 to keep their trailer lot.