When sticking to your goals get difficult.

25 Replies

Yesterday I went house shopping with my brother. He just got a new job and is moving to town. The house he chose was one of the nicest houses I have ever seen. By contrast I live in a trailer park with my friend who drives me nuts most of the time. The master bath in the house my brother chose is larger than my bedroom and his closet is the size of my kitchen. While my brother makes at least $30k/yr more than I do I could actually afford to buy this house. 

I am tempted to buy myself a nice house so I can live in comfort but I when decided to invest in real estate more than a year ago I wrote myself a why statement. I thought sharing it today would help keep me motivated on my path to financial independence and maybe it will help some of you who are starting out.

I grew up very poor. As a child there were times that my mother didn't eat so that I would have enough.  People like to say money doesn't buy happiness. Its obvious to me that those people have never truly been broke. I wasn't very old when I knew I wanted to live a different life than my parents lived.

I was a late bloomer. I didn't start my career until I was 35 years old. It didn't take long for me to figure out that if I were to retire comfortably the way I wanted I would either have to work into my 70's or I would need another source of income. After reading I don't know how many books on investing and financial independence I decided real estate was the answer.

My life's goal is to retire while I am young enough to appreciate my retirement. I want to live in a nice house on some land ideally with a place I can go fishing. I want goats and chickens that will provide fresh eggs, meat and milk. To sustain this I want 6 figures of passive income.

To achieve this I will buy rental properties. I've started out with one house which cashflows over $3000 a year. At this rate I will need over 30 houses to meet my goals. I am in the process of buying my second but have hit a road block. One of the sellers died last week meaning we cannot close until either probate is over or a judge approves the sale of the house. At my current income I can afford to buy 1 house per year. 30 years is too long so I will either need to find houses with better cash flow or I will need to find another source of income to buy these houses.

@Tom R. I hear you it is a long road one at a time. Why not step up to a 10-12-15 unit building? The economies of all your tenants under one roof are amazing. I am having a hard time bringing myself to look at anything less than six, it just does not offer the cash flow I want. It is not the number of houses-it is the number of doors that will get you to your goal.  All the best!

@Tom R. Great to hear your story. Please find local real estate meetups that are run by folks that are not pitching the same old products but rather focus on providing education and networking. Focus on getting educated first and then put a plan into action and take only calculated risks. If in the Bay Area, happy to meet with you and talk real estate. See if you can make it to this event:

https://www.meetup.com/Bay-Area-Multifamily-Moguls/

@Tom R. I look at the return on the total investment with an emphasis on cash flow-the rest is inedible. Measures (ConC etc) in isolation are misleading and too easily manipulated. Cash flow in California is tough at best-I lived south of San Francisco for 30 years. If it does not work in your area stick with what does. All the best!

@Tom R. Real estate is a “get rich slow” scheme.

Slow and steady wins the race.

I did not buy my personal residence until I had 25 units. Let your rentals pay for your big beautiful house. Your brother will have to work until he’s 65 to pay for that house. A little delayed gratification will go a long way. 

@Tom R. When your 80 years old and looking back on your life, what do you think you'll regret more? Not buying the nice house at 40? Or not following your dream of financial independence and retiring on your terms? The fear of regret is the fire that keeps me going when it seems like the goal is too far away.

Right now you can only buy 1 house a year but in 2 or 3 years you can buy a couple houses a year or more. You'll increase in speed as you get better managing your properties, setting rent rates, finding deals and learning the systems. 

In 5 years I went from 0 rentals to 12 units and I'm going to be entering the market for a 10-12 unit building in the next 30~ days. 

As for the title of your discussion "When sticking to your goals get difficult" I'm here to tell you, there's ALWAYS challenges. 

A few challenges I faced

  • not being able to buy the first building until I could afford the mortgage without the incoming rent
  • breaking even on my first building for almost a full year
  • learning how to deal with problem tenants
  • evictions
  • finding contractors
  • not being able to buy my second building until I had enough in reserves for all the bills for 3 months
  • not being able to house hack my third building 
  • (my favorite) agreeing to buy the third building, having JUST enough for the 25% down, closing costs, etc and then at the same exact time getting a $25k tax bill from the previous year. (I got the building and paid the tax bill on time, lots of top ramen) 

My point being is that you'll always have problems sticking to your goals. There's always going to be roadblocks. You just need to make sure they're the right problems to have. 

Reading suggestions

  • Rich dad poor dad
  • The Millionaire next door
  • The richest man in Babylon 
  • The 10x Rule
  • Extreme Ownership <<<<<<Can't recommend this one enough 

I find it hard to believe a SFR will cash-flow better than multi-family. I've just never experienced a market where that's the case.

I think you should look at a duplex, triplex, or fourplex. You could have a much nicer place to live for yourself while stepping up your game as a Landlord/Investor.

My upbringing wasn't too far off from yours. Money doesn't buy happiness, but it does pay for comfort and eliminate stress. I don't have anything to add to the above responses, there's some great advice above. Don't give up- buying a nice house now is exactly what will MAKE you work until you're 70. If this were easy, these boards would be empty and everyone would be loaded. It's not that it's all that difficult to be a successful investor, the reality is that is take patience and sacrifice that most people just don't have- they want a nice house, car, boat, whatever NOW. Most of my friends have all of that stuff, and they work 65 hours a week for it, and will until they die. I drive a 10 year old car, and my couch is almost 20 years old and I get to walk my six year old son to school every day. Who do you think will have regrets on their deathbed?

Change your goals to align with the process rather than the result.  Goal = "go to the gym five days a week" rather than "loose 20 pounds".  High achievers always move the goal line out anyway; so, tying your happiness to the end result rather than daily action can result in unhappiness along the way.

Regarding real estate investing, add value...it speeds up the wealth building process.

I can relate to this post, I have a similar story. i'm early in my investing career and I learned the best is to continue to network in your area and get creative with the financing. think outside the box I do what others in your area are not. Think of out of state investing as I plan on buying an apt building of at least 15 units by 2019. Set goals and take daily action to reach them. surround yourself with like minded individuals daily for you can stay on track. We can do this, it will get easier and once you have a nice rental portfolio your brother will ask for tips on how you are financially free.

Originally posted by @Mike Dymski :

Change your goals to align with the process rather than the result.  Goal = "go to the gym five days a week" rather than "loose 20 pounds".  High achievers always move the goal line out anyway; so, tying your happiness to the end result rather than daily action can result in unhappiness along the way.

Regarding real estate investing, add value...it speeds up the wealth building process.

 in the For What ever its worth category.. to me real estate is life.. its a life style.. there is no retirement.. not sure why folks get so worried about retirement.. you get your stable of whatever kind of real estate you want  sFR multi commercial  Notes  short term lending .. fix and flip  value add  MHP  storage spec building etc etc.. and you nurse them along and work with them until you pass through the pearly gates.. why retire even if you retire with rentals your still involved in some manner.. if I looked at real estate that way I retired at 18 when I started selling the stuff it was and is not a JOB to me its a lifestyle.. Personally I would be bored to death without the excitement of doing deals every week..    Collaborating with others in the industry  and the ups and downs of the economy and deals makes it interesting along the way.. and then you can stop and smell the roses along the way also.. don't want to sacrifice everything as you never know when your number gets called.. Balance along the route is nice..  we live in the Jet age and to not partake in that to me personally is a big miss in many's life experience's..  But that's the way I see it Others like the original poster.. its the hobby farm Goats chickens and fishing.. I get that too I love to fly fish .. but I could not do it every day.. just like I could not play golf every day.  :)

Originally posted by @Jay Hinrichs :
Originally posted by @Mike Dymski:

Change your goals to align with the process rather than the result.  Goal = "go to the gym five days a week" rather than "loose 20 pounds".  High achievers always move the goal line out anyway; so, tying your happiness to the end result rather than daily action can result in unhappiness along the way.

Regarding real estate investing, add value...it speeds up the wealth building process.

 in the For What ever its worth category.. to me real estate is life.. its a life style.. there is no retirement.. not sure why folks get so worried about retirement.. you get your stable of whatever kind of real estate you want  sFR multi commercial  Notes  short term lending .. fix and flip  value add  MHP  storage spec building etc etc.. and you nurse them along and work with them until you pass through the pearly gates.. why retire even if you retire with rentals your still involved in some manner.. if I looked at real estate that way I retired at 18 when I started selling the stuff it was and is not a JOB to me its a lifestyle.. Personally I would be bored to death without the excitement of doing deals every week..    Collaborating with others in the industry  and the ups and downs of the economy and deals makes it interesting along the way.. and then you can stop and smell the roses along the way also.. don't want to sacrifice everything as you never know when your number gets called.. Balance along the route is nice..  we live in the Jet age and to not partake in that to me personally is a big miss in many's life experience's..  But that's the way I see it Others like the original poster.. its the hobby farm Goats chickens and fishing.. I get that too I love to fly fish .. but I could not do it every day.. just like I could not play golf every day.  :)

Most people don't do what they love. They just do what other people around them do. It takes effort to unplug from the matrix.

Most people seeking financial independence do not retire. They just have time to do more of what they love...some actually work more rather than less (but it's no longer "work").

Originally posted by @Mike Dymski :
Originally posted by @Jay Hinrichs:
Originally posted by @Mike Dymski:

Change your goals to align with the process rather than the result.  Goal = "go to the gym five days a week" rather than "loose 20 pounds".  High achievers always move the goal line out anyway; so, tying your happiness to the end result rather than daily action can result in unhappiness along the way.

Regarding real estate investing, add value...it speeds up the wealth building process.

 in the For What ever its worth category.. to me real estate is life.. its a life style.. there is no retirement.. not sure why folks get so worried about retirement.. you get your stable of whatever kind of real estate you want  sFR multi commercial  Notes  short term lending .. fix and flip  value add  MHP  storage spec building etc etc.. and you nurse them along and work with them until you pass through the pearly gates.. why retire even if you retire with rentals your still involved in some manner.. if I looked at real estate that way I retired at 18 when I started selling the stuff it was and is not a JOB to me its a lifestyle.. Personally I would be bored to death without the excitement of doing deals every week..    Collaborating with others in the industry  and the ups and downs of the economy and deals makes it interesting along the way.. and then you can stop and smell the roses along the way also.. don't want to sacrifice everything as you never know when your number gets called.. Balance along the route is nice..  we live in the Jet age and to not partake in that to me personally is a big miss in many's life experience's..  But that's the way I see it Others like the original poster.. its the hobby farm Goats chickens and fishing.. I get that too I love to fly fish .. but I could not do it every day.. just like I could not play golf every day.  :)

Most people don't do what they love. They just do what other people around them do. It takes effort to unplug from the matrix.

Most people seeking financial independence do not retire. They just have time to do more of what they love...some actually work more rather than less (but it's no longer "work").

I wish I could write as eloquently as you do.. you summed it up in two sentences took me two paragraphs..  LOL.. There is just so much to real estate so many avenues..  And your right its rare VERY rare that I don't work Every day of the year except thanksgiving and Christmas day.. something is always happening..   case in point.. the very best weeks to buy court house steps on the west coast is the week of thanks giving and week of Christmas..  the sales still go.. but the competition  is not there,  its the holidays :)  I digress... 

I had a job that I loved. I dabbled in real estate.

I retired from that job. My new job is "retired". I still dabble in real estate.

Find a job you love and have a hobby in which to dabble. Maybe that job is real estate and your hobby is repairing bicycles. Maybe you really love repairing bicycles and you are interested in real estate. My point is make your main income something you love to do. Make your hobby something you have an interest in. 

Hope this doesn't sound too much like babble.

Thanks for sharing! It is always good to be reminded of the why. I am in a similar situation, renting a bedroom in a co workers condo. Often times my lady and I get frustrated living hear but it has allowed us to build the capital to start investing in real estate. On the down days we have to just revisit the why and keep pushing forward. Your "why" will probably not change much, but your "how" and "timeline" likely will.

Originally posted by @Anthony R. :

Right now you can only buy 1 house a year but in 2 or 3 years you can buy a couple houses a year or more. You'll increase in speed as you get better managing your properties, setting rent rates, finding deals and learning the systems. 

In 5 years I went from 0 rentals to 12 units and I'm going to be entering the market for a 10-12 unit building in the next 30~ days. 

As for the title of your discussion "When sticking to your goals get difficult" I'm here to tell you, there's ALWAYS challenges. 

A few challenges I faced

  • not being able to buy the first building until I could afford the mortgage without the incoming rent
  • breaking even on my first building for almost a full year
  • learning how to deal with problem tenants
  • evictions
  • finding contractors
  • not being able to buy my second building until I had enough in reserves for all the bills for 3 months
  • not being able to house hack my third building 
  • (my favorite) agreeing to buy the third building, having JUST enough for the 25% down, closing costs, etc and then at the same exact time getting a $25k tax bill from the previous year. (I got the building and paid the tax bill on time, lots of top ramen) 

My point being is that you'll always have problems sticking to your goals. There's always going to be roadblocks. You just need to make sure they're the right problems to have. 

Reading suggestions

  • Rich dad poor dad
  • The Millionaire next door
  • The richest man in Babylon 
  • The 10x Rule
  • Extreme Ownership <<<<<<Can't recommend this one enough 
Thank you for posting this !I needed to hear it today

@Tom R. Hang in there and maintain discipline. Why worry about what other people are doing? You know you're on the right path. Just take it one day at a time and slowly inch towards your goal. You're very close!

Originally posted by @Mike Dymski :
Originally posted by @Jay Hinrichs:
Originally posted by @Mike Dymski:

Change your goals to align with the process rather than the result.  Goal = "go to the gym five days a week" rather than "loose 20 pounds".  High achievers always move the goal line out anyway; so, tying your happiness to the end result rather than daily action can result in unhappiness along the way.

Regarding real estate investing, add value...it speeds up the wealth building process.

 in the For What ever its worth category.. to me real estate is life.. its a life style.. there is no retirement.. not sure why folks get so worried about retirement.. you get your stable of whatever kind of real estate you want  sFR multi commercial  Notes  short term lending .. fix and flip  value add  MHP  storage spec building etc etc.. and you nurse them along and work with them until you pass through the pearly gates.. why retire even if you retire with rentals your still involved in some manner.. if I looked at real estate that way I retired at 18 when I started selling the stuff it was and is not a JOB to me its a lifestyle.. Personally I would be bored to death without the excitement of doing deals every week..    Collaborating with others in the industry  and the ups and downs of the economy and deals makes it interesting along the way.. and then you can stop and smell the roses along the way also.. don't want to sacrifice everything as you never know when your number gets called.. Balance along the route is nice..  we live in the Jet age and to not partake in that to me personally is a big miss in many's life experience's..  But that's the way I see it Others like the original poster.. its the hobby farm Goats chickens and fishing.. I get that too I love to fly fish .. but I could not do it every day.. just like I could not play golf every day.  :)

Most people don't do what they love. They just do what other people around them do. It takes effort to unplug from the matrix.

Most people seeking financial independence do not retire. They just have time to do more of what they love...some actually work more rather than less (but it's no longer "work").

I like my job but there are plenty of things I would rather be doing. Hobbies like Trout fishing, model making, and traveling don't pay much. 

You should definitely look into multifamily investing. It can be intimidating but there are lots of advantages and can provide much more cash flow, which is what you are looking for. Additionally, you should be using OPM to fund most, if not all of your investments. 

@Tom R. This seems to be something I think about often. I was brought up on both ends of the spectrum. My mother always struggling through her own actions, always struggling to make ends meet. Then I had a father who was a hard working successful middle class man. Me and my brother were tossed back and forth. So I know first hand that true happiness is something we get from within. Having money may make things easier, but both parents had there share of tough tImes. There is a book called “Mans search for meaning”, I suggest you read it. It’s pretty deep and will put a lot into perspective. Finding your purpose in life is the true blessing I thInk. Real estate is a good vehicle for that because there are so many avenues to choose from. One person can give out mortgages to that first time home buyer, while the other rents out low income housing to families who struggle. Both providing a service for others. But it’s not the only one.
@Tom R. What helps me stay focused on the long-term plan is writing down my goals every morning. EVERY morning. And then figuring out a few things I can do that day to move the ball down the court. Also my suggestion to you would be to write down what your goals are, then cross those out and think bigger! I believe in going after impossible goals because like Michelangelo said: the great danger for most of us is not that we aim too high and we miss it, it’s that we aim too low and we reach it.

I guess its about focusing on today, rather than the future. One step at a time.

There are ways to speed the process, like adding value as someone mentioned, buying in only rising/appreciating markets, buy and sell down, bring capital in the door and move to other opportunities/appreciating markets. 

Persistence is key..... that's enough of my rant I guess

Marisa

I think your doing great to be able to get the first one done is the best part. The time is now where you can push forward and be determine, dedicated, and motivated for the ultimate goal to finally be completed.