We’ve all heard the term “strategic plan,” but many of us don’t think it applies. Let me be the first to tell you that it does! Whether you have a goal to create a $35 million real estate portfolio or want to buy one single family home every year until you retire, you need to have a strategic plan.
I am not recommending anything crazy to put one together—just one hour! Because if your life is anything like mine—your kids are running around, screaming their heads off, and spilling milk on your income statement—that is perfectly OK!
Fine, this one-hour plan might actually take you six hours (or even three days). But it is important that you do it! I promise you this time will be well spent, and you will get a return on your investment.
To me, all plans should be strategic. What’s that mean exactly?
The Oxford Dictionary defines strategy as “a plan of action or policy designed to achieve a major or overall aim.”
The keywords are plan, achieve, and aim. You need a plan that helps you achieve what you are aiming for. If you don’t have a plan, or your plan does not lead to your aim, what exactly are you doing?
If you’re feeling behind or overwhelmed, stop it right now! Pencil in some time, and let’s get your strategic plan down on paper.
How to Put Together a Strategic Plan in 60 Minutes
Step 1: Take 20 minutes to figure out exactly where you are right now.
Let’s start with a basic income statement and balance sheet. Robert Kiyosaki calls this a personal financial statement and believes that this is the key to building wealth.
Since Robert’s net worth is somewhere in the $80 million range, most of us could probably benefit from doing what he says and emulating what he does. Just saying.
For your income statement, take the time to delineate every bit of income you earn, and write it at the top of a piece of paper. Under that, write all your expenses. Subtract your expenses from your income to get your cash flow.
You can do this using monthly or annual income and expenses, just ensure you are consistent. This will show you how much you are able to save each month.
If you are spending more than you’re making, it’s time to get real honest with yourself and start living within your means!
Next, let’s work on our balance sheet. Draw a T on a piece of paper and list your assets on the left side and your liabilities on the right.
Jot down every single thing you own and everything you have in your bank account, along with the numbers associated with each. The more detailed you can get, the better.
Subtract your liabilities from your assets, and you will have your net worth.
Be really honest here. You need to figure out exactly where you are in order to plan where you want to go.
Step 2: Take the next 20 minutes to visualize and imagine what you want your life to look like.
Write down words that come to mind: luxury cars, international vacations, complete time freedom. Whatever it is, write it down, clip some pictures, print out some images, get it all out there. And make sure that it is very clear in your mind. Creative visualization can have a powerful impact!
It might not be as clear as you like, but the more you work toward it, the more clear and tangible it will become!
Step 3: Take the next 10 minutes to plan your goals.
You want to start with your 10-year plan or perhaps even further out than that. Ask yourself what you’re aiming to achieve.
What do you want your real estate portfolio to be valued at? How much income do you want to be bringing in? Once you have an idea of the specific goals that will allow you to get to the life you want, you can put a plan in place.
Take these 10-year goals and plan backward. Complete a five-year plan and a one-year plan. Make sure that they’re all embedded and feed into the next plan.
For example, if you are aiming for a $50 million real estate portfolio in 10 years, you might plan to have a portfolio valued at $25 million in five years and $1 million by the end of this year.
Goal setting is critical to the success of your strategic plan, so take it seriously!
Step 4: Take the last 10 minutes to come up with strategic steps that will help you accomplish your goals this year.
Plan incremental stages to reach your goals. For example, if your No. 1 goal is to get out of consumer debt and you have a $12,000 credit card balance, you need to pay off $1,000 of that debt every month.
At this point, you have a solid strategic plan. I recommend that you print this out and put it on your fridge, bathroom mirror, center console of your car, and wall of your office. Put it everywhere and anywhere, so you are always reminded of what you are working toward.
You’re Not Done Yet!
This process needs to be repeated regularly. You should go back and look at these goals over and over and over again. Reassess, reevaluate, and re-plan—especially as you achieve your goals.
And if you end up crushing all your annual goals by September, don’t just quit and relax until the end of the year. You need to set new goals, feed off of that momentum, and accomplish even more.
What are your goals this year?
Write them below to hold yourself accountable!