Ever heard of the book ‘Ready Fire, Aim? It’s a motivational book for entrepreneures based on the premise that you need to take action, intelligent action that is. Forget the business cards if they aren’t perfect, don’t worry about the website if it’s light on content, no need for that branding consultant, what you need is an action oriented approach to get business in the door, and then worry about improving the marketing. This is great advice for anyone starting a business, in fact if you are planning on starting a business you may want to read this book first! You cannot fear ‘failure’, notice how I put failure in quotes, because for most of us, failure is really a stepping stone, a means of learning from and bettering our situation. We are so insulated from failure; society, parents, friends all provide motivation for us to, not fail. We should look at ‘failure’ as a positive, motivating term.
How does this apply to real estate:
Reading this book made me remember my first investment property purchase and my co-workers husband Rick who was also very interested in buying a rental property, he just couldn’t pull the trigger. He would call me up and ask questions about real estate investing, which at the time I knew very little about. He was the analytical type who would spend his weekends touring rental properties, creating spreadsheets to analyze data (for when he would have data to analyze) and doing just about anything you would need to do to prepare to invest. For some reason though, he couldn’t get past being overly analytic, he didn’t have the capacity to rely on his gut feelings. Bless his heart, he was suck at ‘Aim’ in the book; Ready, Fire, Aim.
How I was different:
I am not trying to brag, or say I made the right decision, I was just different. I was naive, trusting, and optimistic. I’m sure I didn’t ask the right questions, and I’m sure I would do it differently now. But you know what, I did it, and you know what, it has turned out to be a wise investment. My property cash-flows upwards of $500 per month,
I have paid off my tenants have paid off nearly $40,000 in principal in 9 years, and on top of it all, I have saved thousands in taxes. It hasn’t been all peaches and cream though, as I have had some bad tenants, been sued, had thousands in maintenance issues, and a few heart stopping agonizing phone calls! But all in all, it has been a worthwhile investment, enough to make me want to buy my second investment property.
Rick has yet to buy his first investment property
Now, I am not busting on Rick, he is a great guy, I just know how passionate he was about investing when we talked back in 2005. To my knowledge he hasn’t pulled the real estate investing trigger yet, something is holding him back. He’s 55 years old, closing in on retirement and his job security is less than… well, secure. Back in 2005 he had a considerable down payment available, so he really could have made some headway with paying down his principal these last 9 years.
Remember ‘Forced Savings Account’!
Let’s face it, Americans are terrible savers! Many of us lack the self-discipline to pay ourselves first by doing things like; making monthly deposits into a savings account, an IRA or a 401k. If you have a month with above-average expenses, will you still contribute to your savings plan? In most cases your knee jerk reaction would be to pay yourself less, if at all, for that particular month. Human nature shows that when expenses go up, contributions go down. Real estate is a long term, Forced Savings Account with tax benefits. Wanna learn more about investing in real estate, read about it at thebiggerpocketspodcast.com. Don’t wake up ten years from now and regret, like Rick does, that you didn’t take advantage of when real estate was ‘affordable’.