Also, this article is not going to discuss land trusts, which some of you may have just stumbled upon. A land trust is not an entity. Although it is frequently used in conjunction with entities, it is merely a paper device used to shield property ownership from the public.
When I first got going, the recurring wisdom was that an investor should use a C corp for cash deals. By cash deals, I mean anything that throws off cash quickly. It might be a wholesale flip, retail assignment, rehab and retail, option, etc.
I personally put together four more real estate deals last week... not to mention the deals that I helped my coaching clients put together. This business gets addictive when you get the system set up. It is a lot of fun seeing deals come together with very little effort.
Not sticking to your plan. The market has been up and down in recent years and this makes people very emotional with their investments and jittery about short-term losses, says Saar. The result for some has been to 'cash out' of poorly performing mutual funds. "If you established a proper, diversified plan when you invested, it is important to stick to it even through the dips in the market," says Saar. "The market may get bumpy but because the RRSP is a long-term investment, you should ride out these bumps. The plan accounts for fluctuations but should still reach its goal in the long run." Investors who contribute regularly to their plan are less impacted by swings in the market and can benefit from an investment strategy called dollar cost averaging.