Going for Gold in 2012

Posted on 11. Dec, 2011 by in General

In the early stages of investing it is way too easy to get overwhelmed with the various strategies out there. You decide to specialise in one area and then a bright shiny penny catches your eye and makes you question your original decision.

Is this normal? Absolutely!  It happens all the time, especially when you see investors doing it well, they make it look easy -but  often they have gone through exactly what you are going through now.

Winging it just doesn’t cut it in the real estate game. You need a clear set of goals, a path to follow so you don’t get caught up with all the what-if’s. The bottom line is if you don’t know where you are going, it is far too easy to make bad decisions based on emotions rather than sticking to the unemotional fundamentals.

So why not take a little time out today or this week and make a plan.  We’ve just finishing off a very detailed business vision for the next 2 years – it’s taken roughly 4 attempts but we are finally getting closer to our goals.  It’s not easy but the clarity will certainly help keep us on track.

Goal setting can help you to avoid making decisions based on fear, greed and hope (these are the three most destructive emotions in real estate). You can look at every potential real estate purchase or sale, check it against your goals and your plan, and make your decision based on whether it moves you closer or further away from your goals.  This simple exercise eventually teaches you to keep your emotions at bay – a critical skill for the successful real estate investor.

Emotions do not play a part in real estate investing, solid economic fundamentals do.
If you focus on the fundamentals and goal planning, you can go ahead and ignore the media! It doesn’t matter if everyone else is terrified, hopeful or filled with greed. You have a plan and are working towards that plan. You will look for specific deals with criteria from your plan, and if something meets your criteria you will buy or sell, no matter what the headline says is happening.

Your Five Year Plan – Goal Setting

This is a good technique which is easy to use. Sit down right now and write down:

  • Where you want to be financially in five years   (be specific, for example do you want to be earning $100,000/year in your job, own two properties that are giving you $500/month in positive income, and have $20,000  saved for retirement)?

 

  • What can you do in the next 12 months to achieve each of the above items   (once again, be specific and try and make the items measurable)?

 

  • What can you do in the next six months to move towards your 12 month goals?

 

  • What must you achieve this month to move towards your 6 and 12 month goals?

 

Take some time out of your busy schedule today, grab a cup of coffee and find a quiet place to think (yes, I know how difficult this is!). Try answering these questions and if they feel right, put them in writing.  If they don’t feel right, keep at it until they do.  Trust in yourself, you ultimately know what path you want to take, you just got to cut through the BS to find what really works for you and floats your boat.  Review these goals regularly. A monthly review is a good habit to get into when you are first starting out and then move onto a quarterly review once you are on target.  Find what works for you, and stick with it.

Have a great week.

Jane

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