Planner Rich Arzaga has a complex relationship with real estate. Under the right circumstances - if a client has the right properties, the right cash flow and the right diversification - the CFP loves it. "Directly held real estate investment is definitely the forgotten asset class in the financial planning world," he says.

But those circumstances aren't always right, he points out. Just take Arzaga's own luxury home in San Ramon, Calif., which the founder and CEO of Cornerstone Wealth Management bought in 2005 for $1.8 million. Today it has a fair market value of $1.6 million - and carries what Arzaga calls the "negative cost structure" of home ownership.

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