Buying a rental property is one of the more common ways to generate passive income. A good rental property will produce enough income each month to cover its expenses with room to spare.

However, rental properties have their pitfalls. The income isn't truly passive because you often need to actively manage the property, including finding the right one, securing a tenant, and then dealing with maintenance and other issues.

Meanwhile, they can be costly, with a high initial investment and the occasional unexpected large expense. Because of that, most people are better off forgetting about buying a rental property.

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Source Fool.com