"Eventually, even if you're only making a little in the beginning, you will watch your income climb over the years."
McLean, who owns three rental properties, spent $18,000 converting a workshop behind his house into a rental house.
It generated $1,000 in income each month, which paid the note on his entire property.
"It's an ideal way to supplement my income," he says.
Another big plus of income-producing properties is that the Internal Revenue Service lets you depreciate the building portion of your property (minus the land) over 27.5 years, which means much of your cash flow will be tax-deferred, Pietrowski says.
"You'll have to recapture that depreciation when you sell, but if you never sell it and you own the property when you die, all that depreciation goes away," she says. "Your heirs don't have to pay it."
Rental properties, however, also come with risks.
For starters, they're expensive.
Banks typically require a larger down payment and charge higher interest rates for rental property than they do for owner-occupied homes.
Real estate in general is also an illiquid asset.
Should you be forced to suddenly sell, you may find yourself in the midst of a down market and unable to unload your home for a reasonable price -- if at all.
At the same time, you may not find renters when you need them, which would force you to cover the mortgage yourself.
Walter Molony, spokesman for the National Association of Realtors, notes investors in income-producing property should keep at least six months' worth of reserves on hand in the event they fail to find a renter.