Should You Add Real Estate to Your Retirement Portfolio?

Whether it is a physical property, such as an apartment building, or an investment in a real-estate investment trust or mutual fund, many financial-planning professionals say that income-producing real estate is an essential part of a well-performing retirement portfolio. However, while 75% of retirees have their money parked in bank accounts or CDs, just 12% own real estate other than their primary residence for investment, according to a survey conducted by the Transamerica Center for Retirement Studies between November 2020 and December 2020.

“In our research, we found that portfolios that have a mixture of stocks, bonds and real estate outperform other portfolios,” said Ken. H. Johnson, Ph.D., a real-estate economist at Florida Atlantic University. “You get a better risk/return profile from owning real estate.”