I’m graduating from college this upcoming May. I’ve went to school because this is what we were “taught” to do. I’ve took many things I’ve learned from school but school is not for me. I want to invest in Real estate and begin to make passive income at a young age. Where should I begin? I’ve went to meetups, met a couple people but how should I actually begin?
1. Start with BiggerPockets Ultimate Beginners Guide (free). It will familiarize you with the basic terminology and benefits. Then you can read a more in-depth book like The Book On Rental Property Investing by Brandon Turner or The Unofficial Guide to Real Estate Investing by Spencer Strauss.
2. Get your finances in order. Get rid of debt, build a budget, and save. The idea that you can build wealth without putting any money into it is a recipe for disaster and the sales pitch of gurus trying to steal your money. A wise investor will not try to get rich quick with shortcuts. If you can't keep control your finances, you are highly unlikely to succeed in real estate investing. Check out my personal favorite, Set For Life by @Scott Trench , or The Total Money Makeover by Dave Ramsey.
3. As you read these books, watch the BiggerPockets podcasts. This will help clarify and reinforce what you are reading. You can hear real-world examples of how others have built their investment portfolio and (hopefully) learn to avoid their mistakes.
4. Now you need to figure out how to find deals and pay for them. Again, the BiggerPockets store has some books for this or you can learn by watching podcasts, reading blogs, and interacting on the forum. There is a handy search bar in the upper right that makes it easy to find previous discussions, blogs, podcasts, and other resources. BiggerPockets also has a calculator you can use to analyze deals and I highly recommend you start this as soon as possible, even if you are not ready to buy. If you consistently analyze properties, it will be much easier to recognize a good deal when it shows up.
5. Jump in! Far too many get stuck in the "paralysis by analysis" stage, thinking they just don't know enough to get started. The truth is, you could read 100 books and still not know enough because certain things need to be learned through trial-and-error. You don't need to know everything to get started; you just need a foundation to build on and the rest will come through experience and then refining your education.
You can build a basic understanding of investing in 3-6 months. How long it takes to be financially ready is different for everyone. Once you're ready, create a goal (e.g. "I will buy at least one single-family home, duplex, triplex, or fourplex before the end of 2019") and then do it. Real estate investing is a pretty forgiving world and the average person can still make money even with some pretty big mistakes.
1. Educate Yourself
2. Set a Goal
3. Find a RE Agent, Banker, and RE Lawyer
4. Buy your first deal
@Nathan G. Thank you I will definitely continue to educate myself and check out those books. I’m working on eliminating some debt and obtaining a substantial amount of money to begin to invest. Ive still got to get a grasp on how to find the RIGHT deal. Thanks again for the advice !
@Jon Reed Thanks, I’ve got the outline of what I need to begin, it’s the little things in between that has me stuck.
At this stage you should not dive into a deal just yet. You need to network and see what type of investing interests you the most. It's during this time you should get to know other like-minded individuals who also share your common interests in investing. While all this is going on, you will need to be working this way you have steady income coming in. This will also allow you to qualify for mortgages and/or credit which can be used to purchase properties.
@Steve Kontos This is definitely the goal right now. I've been trying to network with different individuals while searching for a career that'll get me substantial amount of income for after I graduate to help me obtain my REI goals.
@Cassi Justiz Huge thank you! I will certainly consider finding a job first. House hacking was something I wanted to start out doing once I begin my REI journey. This will allow me to hopefully not have to worry about the income eventually once I get started like you said. Thank you again
So just to add to that, you also want to be aware of your mindset and why you are doing what you are doing.
To get passive income at a young age is a good place to begin; however, that might change as you evolve in your journey.
Another important piece is also to really appreciate that it is a long term play and not a get rich quick scheme.
@Tyus Foster I would start by first figuring out what aspect of real estate you like the most.
If you know what kind of asset class you resonate with the most, you can try and go work with an already successful investor in your market and learn everything you need to know while getting paid.
That's what I did in wholesaling and it worked out great!
@Ola Dantis I agree, my overall mindset is to free my future. Future not really at the normal retirement age but I would like to allow my parents to retire and free up there time as well. Being that person in my family teaching other how to gain passive income. I know it’s a journey and not a get rich which scheme. I am willing to work, learn, do whatever it takes to obtain financial freedom. Thanks for the advice
@Jaren Barnes sounds like a good way to start actually but as far as working with them and getting paid, what actually would you be doing?
@Tyus Foster Yea great question! It all depends on what niche you're in.
If you want to be an apartment owner, starting out as a leasing agent for a commercial property management company might be a great start.
If you wanted to work as fix and flipper, maybe finding one - or better yet, a turn-key operation - could be a good start.
They'd have you hunt for deals, network, screen calls etc.
Does that make sense?
@Jaren Barnes makes sense, so basically approach them sell my pitch and ask if there is any way I could work with you to gain some more knowledge?
@Tyus Foster I would just go in with the heart to radically serve them and be super humble. Even if you're bringing them coffee, or scrubbing toilets in the office, whatever you can do to work for the person you want to be like in your life and career.
Tell them you'll doorknock if you have to, and if they have a need they'll find something for you to do.
@Jaren Barnes thanks I really appreciate it, I’ll get to it just don’t ever want to get abused by my will to work or learn by someone with something I want.
@Tyus Foster If I may be so bold - I know you don't know me from Adam, so definitely take this with a grain of salt - but I'd maybe challenge the "worry about being abused by your will to work."
I'm 28, so I'm not saying this as an old crotchety man, believe me!
My wife is from a former Soviet Union nation, and she really helped me see work in a different lens than how I did when I was a kid.
The ability to work hard is a gift - especially when it comes to working for someone super successful.
There are a lot of people in developing nations who would kill for the opportunities we have here in America.
In our generation, for some odd reason, we lead a lot with making sure our "rights" aren't violated, but neglect to see the full value of the opportunity in front of us.
I definitely encourage you to join up with people that have a similar moral compass as you do, but once you find good soil to plant in, I'd suggest you give everything you got to the opportunity before you- no holding back at all!
I did that at Simple Wholesaling - a wholesale company out of Indianapolis I used to work for.
I found my former boss and he hired me part-time at like $10 an hour.
Within a month, I was full time and within a year and a half, I was making more money than I ever had in my entire life!
@Brett Snodgrass gave me an inch and I got everything I could out of that opportunity but how I did it was I literally slaved away - working 6-7 days a week (even on Christmas), for close to three years.
Even though this is counter-intuitive, you get promoted in life the more you serve and promote others - at least that's how it's worked in my experience so far.
@Jaren Barnes thanks for the encouragement and allowing me to see it differently. My approach and will to work will be different now, thanks for everything. It was all good stuff !
@Tyus Foster awesome, my friend! I’m rooting for you!