5 min read
Do you earn a large income? Chances are that you have more investing opportunities than the average person, and you might be overlooking many of them! In this article, we’ll discuss some of the top investment options for high-income earners, their pros and cons, and the many benefits of diversifying beyond the stock market!
Summary:
- Many high-income earners max out retirement accounts and fund brokerage accounts, but are unaware of niche benefits of opportunities like real estate investing.
- High-income earners can diversify their portfolios and reduce their overall tax burden through various real estate investments.
- Turnkey rentals, syndications, REITs, and private lending are a few of the real estate investing opportunities that can help fund your retirement.
Got High Income?
If you’re a CEO, business owner, executive, doctor, lawyer, or other high-paid professional, you’ve most likely got a good problem: too much disposable income. If you earn $170,000 or more per year, you’re in the top 10% income earners.
You may already be maxing out your retirement accounts and want to go beyond regular brokerage investing. What’s more, many high-income earners may want to start transitioning out of their high-stress profession, and the following high-income investment strategies can help bridge the gap!
1. Turnkey Real Estate
Turnkey rentals are new builds or recently renovated properties that can give you the cash flow, appreciation, and tax benefits of regular rentals without the stress of being a landlord. Because these properties usually have management and tenants in place, you don’t have to devote hours to them each week.
Rent to Retirement is one of the top-rated turnkey companies in the nation. We currently have turnkey rental properties for sale in some of the best cash flow and appreciation markets!
Why It’s for High-Income Earners
If you want the benefits of owning real estate without pouring hours and hours into real estate each week, turnkey is the way to go! These properties offer the following:
- Tax Benefits: The more you make, the more you owe in taxes, which is why you need tax-advantaged investments to offset your high taxable income. Turnkey rentals give you depreciation deductions, allowing you to shelter much of your earned rental income.
- Passive Income: High-income earners work long hours as is and need investments that won’t add more to their plate.
- Retirement-Ready: Turnkey properties not only benefit you right now but can become a sizable amount of your retirement portfolio.
- Diversification: You can invest in some of the country’s best places to buy rental property with turnkey real estate that produces cash flow, long-term appreciation, or both!
2. Real Estate Syndications
A syndication is where multiple investors pool their money together to purchase a property. Many of these opportunities are limited to high-income earners, as you often need to be an accredited investor to participate. (An accredited investor earns at least $200,000 a year or $300,000 if married, or they have a total net worth of at least $1,000,000, excluding their primary residence.)
Note: Syndications can be risky, so investors must do their due diligence on the general partners and the deal itself before investing.
Why It’s for High-Income Earners
High-income earners are more often accredited investors, and syndications require a significant amount of capital that the average person doesn’t have. Beyond that, these investments provide:
- Completely Passive Income: In a syndication, the property is usually managed by the general partner (also called the “sponsor” or “operator”), while limited partners simply share in the profits.
- Higher (Potential) Returns: Many high earners want their money to work harder for them. While the stock market has delivered 10% average returns over the last 60 years, syndications can provide 15% - 20% annualized returns.
- Tax Benefits: Like turnkey rentals, syndications can provide some depreciation, helping you offset gains.
3. REITs (Real Estate Investment Trusts)
A REIT is a company that owns and operates real estate. As the investor, you buy shares of the company (like stocks), and as the company grows, so does your investment. Plus, you’ll receive regular dividends!
Why It’s for High-Income Earners
If you’re already investing in stocks through your retirement and brokerage accounts, you’ll find that investing in REITs is similar. These investments also provide the following:
- Industry Diversification: There are REITs for residential, commercial, and industrial real estate across many different industries, so it’s easy to diversify.
- Completely Passive Income: Like stocks, REITs give you entirely passive income. You don’t own or manage the properties—the companies do!
- Tax-Advantaged Dividends: You can buy REITs in your retirement accounts, which allows them to be tax advantaged.
Want to invest in cash-flowing, tax-advantaged, passively-managed real estate?
4. Private Lending
Private lending is when you loan your own money to another person or company—often a real estate investor for a house flip or another short-term project. Like with any bank loan, you receive regular payments with interest until the balance has been paid in full. Before lending money, you should do serious due diligence on both the deal and the investor. A lien should also be placed by the lender on the property for collateral in case the project goes south.
Why It’s for High-Income Earners
Private lending is one of the best investment strategies for high-income earners since they often have large amounts of capital to deploy. Many prefer this investing strategy due to the following:
- Strong Returns: Private lending can make the lender 12%+ annualized returns (with mortgage points!).
- Completely Passive Income: With private lending, the investor is doing all of the work. You’re just getting the check!
- Fixed Income: Some investors may want the steady return of a check hitting their account every month or quarter.
- Short Return Window: Many private lenders only lend for 6-12 months, since this is how long a project may take. The faster you recycle your capital, the higher your return can be.
Going Beyond Traditional Retirement Investing
The above high-income investment strategies are all real estate-related, and this is because many high-income earners are unaware of the numerous investment options that exist outside of regular stocks and ETFs. Real estate gives you benefits unmatched by most stock and retirement account investments, making it a powerful tool to help fuel early (or traditional) retirement.
Use Retirement Accounts to Buy Real Estate
Do you have a large sum of money you want to keep in tax-advantaged retirement accounts? With a self-directed individual retirement account (SDIRA), you can invest these funds in various alternative assets—including real estate!
Just keep in mind that if you’re buying a rental property, the IRA will technically be the owner of the property, and any property-related income and expenses must flow through the account.
Got High Income? Let’s Get You a Better Return
As a high-income earner, you have a serious advantage when it comes to building long-term wealth. Rather than pouring all of your savings into an after-tax brokerage account, you can make your money work much harder for you and diversify your portfolio by investing in real estate. Plus, you’ll get tax benefits that you can’t get with most other investments!
Investment Options for High-Income Earners FAQs
What Are the Best Investments for High-Income Earners?
Most high-income earners aren’t looking to take on another “job.” Thankfully, many real estate investment strategies deliver passive income and can help top earners diversify beyond the stock market, which they’re likely already investing in with retirement and after-tax brokerage accounts!
What is the Best Way to Invest $300,000 for Income?
There is no universal “best” way to invest $300,000 for income, as this largely depends on your lifestyle, investing goals, and risk tolerance. Some of the best investment options include turnkey rental properties, syndications, REITs, and private lending opportunities!
Does a Roth IRA Make Sense for High-Income Earners?
A Roth IRA is a great retirement strategy for many, but in 2025, your modified adjusted gross income (MAGI) must be below $165,000 (or $246,000 if filing jointly) to contribute to a Roth IRA in some capacity. If you’re above the income limits, you can bypass them by using the backdoor or mega backdoor Roth strategy.