What gets you out of the bed each day? Do you have goals and plans, both short and long term, or is the fact that you will be out on the streets if you don’t make next months rent or mortgage payment what motivates you? I say this to prove a point. Some people are pleasure motivated and some people are pain motivated.
I think it’s important to find out which you are. If you are pain motivated I suggest that you find something to get excited about. Even if your goal is not for you but for a family member it can still motivate you.
Setting goals are very simple. It can be done by anyone. Are you ready? Here’s what you have to do to set a goal…. Decide what you want and write it down. That’s it!
Just the fact that you wrote it down increases you chances of obtaining your goal. The other thing you need to do is set a deadline for achieving your goal. A goal without a deadline is just a conversation. This is worth repeating. A goal without a deadline is just a conversation. You also need to consider balance in your life when goal setting.
You should have different types of goals. You need financial, physical, personal development, family and spiritual goals. Can you see that if you set goals in all of these areas then you will also have balance in your life?
Once you have your goals set then you need to determine the activities required to achieve your goals. Just remember, do not confuse activity with productivity. You must produce to achieve your goals.
Let’s talk about applying this to your real estate investing. You need to set your investing goals to include cash, cash flow, and equity. Each time you purchase a home you need to run the numbers to add up these three items for the property. How much cash can you get out in the refinance, what will the cash flow be and how much will your net worth increase after you purchase the property? You could even use a spread sheet to keep track.
I also want you to keep track of your return on the equity in your property. If you have $20,000 equity in a property and your cash flow is break even, what is your return on equity? Zero! This is one that you should sell and invest the equity somewhere else to get a return on your money.
The last thing I want to do is give you some questions to ask yourself before you set your goals.
- Am I reading the books that will take me where I want to be?
- Who am I around and what are they doing to me?
- Do I have a coach or mentor that I can call on?
- How do I feel physically?
- If I get what I want will I be happy with what I have?
All of these questions sound simple but you need to ask them to yourself. After all, you don’t want to work your entire career climbing the ladder only to realize it’s leaning against the wrong tree.