I know that a college education isn't exactly necessary to get started in REI, but I am currently on my way to getting my degree and figure I should go for something that would help my endeavors in real estate. I haven't started any core curriculum classes yet and was wondering if anyone had advice on which degree would be best.
Business? Entrepreneurship? Finance?
A college degree is not necessary to invest in real estate but it can certainly help. The college degree can help you get a job which will fund your first few properties.
Finance is a good choice because a lot of being successful real estate in being able to see opportunities. To identify an opportunity you are going to have too crunch numbers and analyze things from a financial perspective.
It really depends what you are trying to do in real estate. A degree in finance may help you crunch numbers for a buy and hold or a sales background may prepare you for wholesaling.
While they may not be applied 100% to Real Estate, I would recommend the following fields: Accounting, Psychology, Engineering or Law
Accounting is generally a little more rigorous than Finance, Economics could be another option if you are interested in that.
Psychology would be a good degree to help with the marketing/sales aspects of Real Estate.
Engineering would help with some of the home improvement areas. Also both Engineering and Real Estate involve a lot of problem solving. Another advantage of Engineering is it usually leads to a good paying entry level job, so you will have more income to invest in Real Estate.
In terms of Law, I doubt getting a JD would be productive - unless you want to be a Real Estate lawyer. However having the ability to understand contracts well is very important.
Whatever course of study you chose, I would look for courses require a decent amount of writing. I also would take a course or two that will give you some computer skills, you don't have to be a programmer, but having the ability to do the easy stuff yourself is a good idea. Also Math skills are good even if it isn't your favorite subject.
@Chris Parker personally I like a degree to fall back on. I have a nursing degree yet haven't worked in the field for nearly 10 years now since I started doing real estate investing full time - Plan A. But, it's a good one for a Plan B if a Plan B is ever needed.
I think you can learn the process of investing without a specific degree.
Whatever you choose to do good luck in your endeavors!
@Chris Parker I echo a lot of the thoughts above.
One of the amazing things about real estate is that there are so many unique and different skills that will help you do well. Like @Jesse T. mentioned there are so many majors that can help.
Good luck with whatever you choose, and please keep us posted on your progress!
I'd encourage you to choose a major that meets three criteria:
1. Course work you will enjoy,
2. Course work that is relevant to RE if this is your goal,
3. Course work that will offer easily accessible fall back job opportunities. Ex. My gut says a bs/ba in accounting, marketing, or finance will have more entry level positions available than psychology. Remember w-2 income can definitely help!
Most of all, focus on #1. Good luck and enjoy.
I agree with @Greg Baker it's very important to wake up in the morning excited about going to work because you love your job
I'm in the same position, currently going to school but hoping real estate will be my career. I'm currently in a real estate finance program, but I'm thinking of switching to accounting. Like it was mentioned above, solid w-2 income is usually where the investing starts from.
Thanks for all of the great advice and insight guys.
@Greg Baker I was thinking the same thing about accounting, marketing, or finance. There's a course at a university nearby that has a pretty comprehensive degree called Business Enterprise and Essential Management Skills that I think would be useful toward both RE and an entry level W-2 job. I'm currently in the Air Force and will be for then next five years so I luckily have that income for that time period. Planning for the future though.
Any thoughts on RE management certification courses? The school I'm with now, AMU, has one available and may have good information. Then again so does BP.
Depending on the niche of investing you want to get into, I would suggest a Business/Marketing degree as a solid foundation.
When I began to understand the nature of investing, especially wholesaling, I realized that I'm being tasked with finding buyers & sellers, not selling homes. I happened to major in marketing and can recall multiple projects where we did ACTUAL direct marketing campaigns for local businesses - I use those lessons today in my own DM.
Most investors start off raising capital via wholesaling BTW. And it's a lot of fun.
Not to mention that Marketing is essentially a social science spin off into the business world (consumer behavior, pricing strategy, professional selling, etc). I'd rather learn about what influences buying behavior than what makes Pavlov's dogs salivate.
As part of a any business major, you will have sufficient exposure to things like accounting, finance, management, etc as part of your core curriculum. By the time you get through 4+ years of a standard University education, you should be well rounded enough to get the job done. What they don't teach in college is hustle, so you'd have to find that yourself :)
As far as an accounting or engineering degree (previous suggestions), I completely and respectfully disagree. Those hyper-specialized functions are best left to people who work FOR you - I'd rather pay my accountant to navigate the IRS requirements on my S-Corps any day of the week.
Think of yourself as the man with the vision, or the conductor of an orchestra - you need to spend your time wheeling and dealing. Best of luck.
Looking back I think my undergrad course work in finance and accounting has been very useful for me as broker/owner, investor, and dealing with my clients. I think an undergraduate degree with a concentration in finance is a good choice whether you pursue a career investing in real estate or wall street.
If you don't have the funds or the time to get a 4 year degree , I would highly recommend taking the CCIM curriculum or atleast CI 101 Financial Analysis even though you don't sit for the 6 hour exam. You will learn how create a discount cash flow analysis, calculate NPV, IRR, Operating Expense ratio, Profitability Index etc. CCIM designation is considered to be the MBA equivalent among commercial real estate professionals. Most real estate designations I consider to be mickey mouse letters you put on your business card. however the CCIM designation is one RE designation I have high regards for.
CCIM 4 core classes
Originally posted by @Mark Moore :
Think of yourself as the man with the vision, or the conductor of an orchestra - you need to spend your time wheeling and dealing. Best of luck.
I think that is very sound advice and pretty much what I'm looking for. I somewhat have the vision, I just want the degree that will help make that vision a reality. Great advice and I think, as @Brandon Turner would say, very Tweetable!
@James Park While I do have the time and money for college, I wasn't aware of the opportunity with CCIM you referenced in your post. I will definitely be adding it to my education plans on top of everything else. Thank you for the suggestion as well as taking the time to link to the classes. Much appreciated!
Totally agree with James, others too, real estate falls under the finance umbrella. To obtain a more specific education, the CCIM will be the better way than generalist degree, take it after obtaining a finance degree and it will be much easier.
I had to grin with Jesse's comment of accounting being more difficult than finance, having both I disagree. I taught them as well, accounting is rather mechanical until you get past basic accounting, then becomes more subject within accepted practices. Finance requires accounting and then branches out to other aspects of commerce, banking, business finance, economics, insurance, investments and real estate. Finance is more conceptual in application, much like law, but is in the shadow of a law degree.
Yes, the best degree for real estate would be a law degree, but you won't earn that in 4 years.
Any degree program can be made difficult, the thing to do is find those who have taken courses and ask them about the course but more importantly ask about the instructors!
Here's what I suggest :
Accounting 101 & 102
Psychology 101 & 102
Personal Finance/ Principles of Insurance
Psychology 101 & 102
Principles of Real Estate
Statistics 101& 102
Economics 101 & 102
Managerial Accounting / Financial Analysis
Sociology / Entrepreneurship
Just realized, I don't know what electives might be offered.
The way I listed those follow prerequisite knowledge, also don't take accounting at the same time you take economics, there are conflicting concepts that mess with some minds. Don't take personal finance and insurance at the same time, they overlap, same with psychology and sociology.
Any of the 101 102 classes can be taken first, except as together as mentioned.
You need statistics before managerial accounting, financial analysis and entrepreneurship.
Two more classes in accounting should give you an accounting degree, like tax accounting, governmental and non-profit accounting.
Money and Banking is an elective for finance and a good insight to consumer and business banking. You may have a finance degree at this point.
What you don't need is (or want is) a business generalist degree!
Look at the upcoming jobs predicted. RE may be a goal today, but you may find yourself doing almost anything and something you enjoy, so look for marketable degrees.
IT is big, before my time, squeeze computer sciences in, it's the way all business is done.
If you are entrepreneurial these business classes are need IMO. Industries are picking up more liberal arts degrees, music, history, political science and they are teaching the company way as to financial products. Banking, insurance, investing is people oriented, the technical side can be taught. RE is a social business as well.
Military satellite schools are a great way to pick up credits, but select a school for the degree and ensure credits will be accepted from other schools, all will have limits. You can look for the better instructors that way, night classes are good too. Reason I mention this is because I had a business management instructor that was a part timer who managed a gas company, he was very weak in accounting aspects, but hey, an "A" is an "A" LOL. :)
Stay away from college!!!
One of the many reasons I got into Real Estate is to hopefully help get out of the debt created by obtaining a college education. IMO there are so many resources and opportunities in Real Estate that pursuing a degree of somesort pertaining to it, would be unnecessary. Anything beyond the courses that can be obtained at any local real estate school is a waste of valuable time better spent elsewhere. Unlike other fields, real estate is a level playing field in which the most knowledgeable, not necessarily the most educated, can rise to the top! Done.
Keep in mind your return on investment. I have a college education in Computer Science which allowed me to generate some seed capital by working for a software company. While I don't use that skill set exactly in my real estate business, it does provide me the ability to develop web sites and software for our business which is a key component.
Having a degree is more than just the technical skills that come with it. It can teach you how to focus and meet deadlines which is important in any business.
That being said, knowing how to manage a budget in a spreadsheet is the core of what you need to be able to do to be successful in real estate transactions which I don't think requires a degree.
There is of course the marketing component, lots of legal water to navigate, and if you scale your business finance will certainly allow you to create more creative ways to get deals done and manage larger projects with creative financial instruments. So I would probably pick a finance degree as the most relevant because it will help you scale and grow the business to more than a handful of deals per year. The other skills can be hired out. Finance can too, but understanding the financing will give you a lot more power in your transactions.
@Bill Gulley My goal is to pick a degree that will both help my RE endeavors as well as help obtain a career to feed the RE machine. Six months ago I would have never considered a career in finance, but that's what happens when you find your passion. I was reading nolo.com's Every Landlord's Tax Deduction Guide last week and couldn't put it down. It took me turning 30 to finally find my passion, but I guess some people never find theirs. Thanks for the advice!
As usual, I'm impressed with Bill's post. Good stuff.
My degree was 20 years ago, bit it's in finance and serves as a pretty good base for what we do. Certainly a big part of making money is learning how it works...
I'm reminded of a student asking Roberto Guizuetta what he should study when he spoke at our school and his answer was "at the end of the day, you have to learn all of it". I've got WAY more hours in money in my RE education from seminars and such than I do in college coursework. Some of what makes sense will depend on what you use it for. Keep in mind college generally teaches you how to work for other people, nobody in this business will ask you what your major was or what school you went to, that's for the corporate folks.
I have a degree in Finance and Accounting with a Masters in Finance. It has serve me VERY well. Being able to understand the tax, mortgage and the other language in this business has been an amazing asset. It has even let me work in the industry as management. Allowing me to learn by "playing" with someone else money!
@Chris Parker I don't think I'll have too much to contribute that hasn't already been covered...but I feel like I should definitely weigh in haha.
I'm in the Air Force as well and have one semester left (thankfully) in a 48 credit hour MBA with a concentration in entrepreneurship. Although I consider myself very lucky to have my education paid for by the military, if I could do it again I would choose something a bit less time consuming. I've been taking two classes every semester for the last 2.5 years, all while working full time, deploying half the year, and investing in real estate. Needless to say, it has been taxing lol
So to sum it all up....The courses that I found most beneficial to real estate were 'marketing', 'finance/accounting', and 'entrepreneurship'. However, do consider the amount of time the degree will take as well as what material you will cover. Had I done a 32 credit masters as opposed to 48, I could have saved about $2,000 and had a full extra year to dedicate towards real estate instead of homework.
Hope this helps. Best of luck Chris, and feel free to send me a message if there is anything I can do to help.
@Tyler Flagg MBA is a fantastic degree. I think you've made a wise decision. I haven't regretted it all, and like RE, opens up a lot of doors.
My MBA has been the best thing that ever happened to me. It was also the worst 13 month of my life. But the best $8,000 I ever spent. It got me my first job in real estate as an executive assistant, and I later go to apprentice through a full time salary under a brilliant senior business analyst. i know have a fantastic job teaching me commercial real estate under another fantastic mentor.
For $8,000 it has been the ticket that has made me thousands and hopefully some day millions while retiring early. That this has been the backbone that I built my empire on. Knowledge is power, that power isn't easy to get in any ways. Whether its street or book smart. Getting my undergraduate in 2.5 years or my masters in 13 months were amazing accomplishments, but weren't easy. My 13 month MBA was so not fun that my husband said the only way I am allowed to go back to school is if he is deployed and can just read "emails". That being said I am thankful I did it every day.
There are many ways to success. Figure out what works for you and go from there. No one way is going to fit everyone!
HANDS DOWN - x-ray tech!
Why? Shortest time in education, biggest payoff (salary) and great benefits.
In order to effectively invest in real estate you need
#1 capital/credit - good salary. x-ray/ultrasound/CT/MRI techs make between 50K to 120K per year! they are able to build good credit histories quickly. Very little student loan debt.
#2 Time - x-ray techs have flexible schedules (work more when young - make more money) then work less when you don't need to. Spend extra time building real estate.
#3 Very short time to a good salary. X-ray techs require handful of prerequisites with a junior college (Associate level degree) and then followed by 2 years in tech school.
Most x-ray/ultrasound/CT/MRI techs who are veterans make around $45-$60/hr at my hospital. This is obviously not typical in the rest of the country, but regardless, techs make very good money.
I have been pretty happy with my education as far as real estate is involved. I received my undergraduate in accounting and finance (used that to have my own public accounting firm); took the required real estate courses to be real estate agent (but never wanted to be an agent, only understand the process) and then got my Master's in entrepreneurship to be more involved with creative approaches. All told, I think the accounting and finance degrees have been the key to my success.
Mind I ask what you ended up choosing?
Best of luck!
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