Can stupid people successfully invest in Real Estate?

15 Replies

I'm an older blue collar working lady.  Never went to college and really bad at math.  Been working in retail supermarkets since age 16.  I just moved to a small town in Missouri.  I'm currently unemployed, but I've been applying ever since I got here and have had 2 job offers from supermarkets in town.  I turned them both down and I can't believe it.  I am not a lazy person, in fact my previous employer of 15 years "spoke to me" frequently about staying after hours.  I did it because I wanted the job done right and didn't mind doing it, even though I wasn't getting paid and I was off the clock.  Since I moved, I've been listening to RE investment podcasts (Bigger Pockets and others) pretty much non-stop.  I've tried driving for dollars and checking out, zillow, etc. for my area.  There are literally tons of cheap properties in this town.  Many are within walking distance of my home.  Here's the thing.  I'm not the smartest person when it comes to legal matters/documents.  I had to have our RE agent explain line by line the docu sign forms when we sold our old home and bought our new house.  I literally thought that if I did one thing wrong during the process (first time I ever sold or bought a house) they would take everything I own and put me in jail.  My goal is to make enough money to live on so that I don't have to work for the rest of my life in a job that I hate.  Something changed in me when I moved here.  I could not bear the thought of slowly dying at another lousy job.  So this is my question Bigger Pockets community:  Can stupid people like me successfully invest in RE?  I have saved money during the 40+years of my work life and do not splurge on anything.  I've never used a credit card in my life and I've never taken out a loan.  I thought this was a good thing, until I learned that no credit history is a bad thing.  It just never made sense to me to spend money that wasn't mine for stuff that I couldn't afford.  After reading "Rich Dad, Poor Dad" I learned to consider thinking another way.  So, it's either RE investing or going to truck driver training school at 50+ because I hear they can make pretty good money.  I want to learn RE investing, but I just don't know if I'm smart enough to do it.  I really need a mentor to help me with this, but I don't know of any where I live.  I could really do with some advice and guidance if it's out there please.  Thanks to anyone reading this.  I'm sorry it was so long.

Hi Ms. Buzzetta,

Based on what you wrote in your post, I don't find you a stupid person at all.  By you investing your time educating yourself on Bigger pockets and RE podcasts, reading Rich Dad, Poor Dad, and to never have any debt, I think you are very smart with all of that and way ahead of many people.  All you have to do is get educated in regarding real estate investing.  You just need time, and experience.  I recommend you continue what you are doing, and also practice analyzing real estate deals, look for opportunities and grow your network.  As I tell people, the hardest thing (in my experience) is finding attractive investment opportunities.  But once you find one, it is easy to get the money to acquire it.  

Regarding understanding the paperwork . . . several years ago I moved to Hawaii and got my real estate license.  This is after I'd been licensed twice in Washington once in California.  I even owned my own real estate sales company.  But despite my experience, I was somewhat overwhelmed by the paperwork they use in Hawaii.  I'm over 2 years in as a full time agent here and still ask my broker for help at times.  So it will take you some time to get comfortable with the language in real estate contracts.  And until you are comfortable with all the paperwork, I highly recommend you have a trusted mentor, or you hire a quality real estate attorney, to advise you in order to protect your interests.  

Wish you luck 

Well, a couple of things:

1. If you think of yourself as a "stupid person" - assuming you're not talking about a real mental handicap - then you are going to have trouble in everything you do. I think there's a difference between being stupid and being ignorant. Ignorant means you just don't know. Stupid means you know and you do it anyway. You've made it 50 years + on this earth without pulling a Wile E. Coyote, so give yourself some credit.

2. It's difficult to do anything that has to do with investments if you are bad at math and don't have anyone to do the numbers for you. THAT SAID, there are a lot of people on this board that are more than happy to help with numbers if you post them up; there are BP calculators on here that you can use to run numbers on potential purchases. You don't necessarily have to have a local mentor.

3. You can always start with something small. Buy a duplex or a triplex that you can live in one side and rent out the other. There's nothing complicated about that and in many cases you can make enough to cover your mortgage, so you now have no out of pocket living expenses for housing, and you get to learn about running a rental up close where you can just walk next door and collect the rent if you want to go the simple route and find out what needs fixing the day it happens.

You're the only one who can decide if RE investing is right for you. 

Everyone can invest in real estate! That's the first thing I learned in The Millionaire Real Estate Investor by Gary Keller!

@C. Buzzetta  From the responses you have received so far, I hope you realize that you have clearly shown you are not a stupid person.  Very few things in life come to anyone completely naturally.  All things worth doing take time and effort.  Sounds like you have started on your journey of learning.  All you have to do is focus on getting slightly better / making small progress every day and you can achieve your goals.

I would suggest looking up local meetups in your area as this will allow you to network with other investors.  Building these relationships will allow you to see how others are doing things and learn.  There are a lot of resources available that will help you overcome any of the areas investing (math, lending, inspections. etc.) that are troubling for you.

Best of luck in all your investing.


No you don't have to have a college education or be good at math to go into real estate investing, but you do need to have some sort of income to buy a property and if you aren't good at math, hire a good property manager who is.

A good place to start is buying a duplex where you live in one half and you rent the other half.  This lets you buy a place with a lower down payment and if done right, cuts your living expenses to almost nothing.

I wouldn’t say it’s a choice between real estate and truck driving, you should do both, live frugally and pile up your truck driving money into down payments on houses.

My mother was a high school drop out, had 2 children as a teenager, was on welfare a lot of her life. Widowed at 47, she bought her first rental around age 49/50. By the time she retired in mid 60s she had 12 or 15 rentals or so.

You claim you are an 'older' lady and with your working history and trade skills if you was my mother I would recommend that you stay away from any type of investing. When it comes to finding a real estate broker or agent, you can find millions of them who will tell you that every house they have for sale is super great for you. It is nearly impossible to find a real estate agent who will do the research to find you a good investment property. Every property on the market is great for the sellers, seller's agents and your personal brokers.

There is an old saying, "Don't believe anything you hear and you limit what you believe to only 2% of what you actually see." 

The very most-important factor you have to consider before investing in real estate, the stock market, entering into a partnership, or starting a business is you need to be able to understand and calculate the risks because every type of investment has inherent risks and it is the risks that cause you to lose some or all of your money.

Not many people who invest in real estate lose money, but some do. Many people purchase the wrong properties and then can't afford repairs, vacancies and they don't have a clue regarding how to manage properties and don't have a clue regarding what to do when the tenant from hell destroys the property and does not pay rent for 6 to 9 months while you are paying the mortgage and an attorney.

If you a gambling woman with huge suitcases full of money then jump right in and take your chances not with real estate, but take your chances trying to find an honest and competent person who will guide you in the right direction like you are their mother. Slim chance!

Throughout my entire life, I heard stories from thousands of people who claimed they were making thousands, or millions of dollars. When I hear those stories I always think about Kenny Rogers, "Don't Do The Counting Til' The Dealings Done".

I never count someone else's money in my mind because so many people are so full of B.S. and they tell you they are getting rich, but they don't tell the truth and after time passes I find that most of these people's business ventures didn't pan out and these people made either very little money when compared to their effort, or they actually lost money.

Here is an example. I just made $50,000 on a house I flipped in 3 months. I purchases the house for $400,000, spend $50,000 for expenses and repairs and sole it for $500,000. The problem with people making most of the videos is they have ego problems and they don't tell the whole story. If you told me you made $50,000 flipping this house, or any other house, I would say you are full of b.s and you did not tell the whole story nor are you telling the truth because I can do the math in my head quicker that you can with a calculator and I know you left out a lot of your costs, did not include your 20% to 25% income tax and you probably did not even do the math, yourself.

It is not that everyone is dishonest. The problem is; it is difficult to find someone who will watch your back and by the time you realize you picked the wrong mentor you already invested and lost a portion of your hard-earned money and the only thing that was guaranteed before you invest your money based on another person's advice is that person will not refund your money.

I sort of have a hatred for people have the titles Financial Advisors, Investment Specialists and my biggest hatred is for Stock Brokers. These people have a lot of brass when it comes to risking Other People's Money and then when their clients lose money they have no conscience. In 1980, my CPA recommended that I invest $1 million in two K-Mart properties. I lost my entire $1 million. Do you think my CPA felt bad about my loss. 

In 2001, I had $650,000 invested with Dean Witter. My portfolio dropped to $350,000 when our great government broke up Microsoft. My broker kept changing (trading) my stocks and every time he made a trade he made a commission and still lined his pockets as my portfolio dropped to $250,000.

Who was this Dean Witter trader? He was my uncle's son and did trading for many members of my family. I guess you could say, "it was luck" when he got fired from Dean Witter (don't know why), but at least, he is not losing any more money for any of my family.

It takes a very special type person to risk their clients' money and still get paid when their clients lose money. About 25 years ago, a young woman asked me where she could invest $50,000. I referred her to my CPA's wife and she worked for New York Life. The NY agent sold my friend an A T & T annuity for $50,000 (if that is what you call it. Can't think.) About one week later, the $50,000 dropper to $35,000. Seven years later, the annuity was still worth $35,000. The agent told my friend she had to keep her money in the annuity 'long-term' to make money. Wow! She has to wait more than 7 years just to break even.

This is the kind of person I am and this is how every person should be if they are going to tell other people how and where to invest their money. I told my friend to close out her annuity and I paid her the $15,000 she lost just because I felt bad for being the person who gave her bad advice. Still, after 7 years, my friend still had only the $50,000 and lost out on the opportunity to make 3% to 5% for 7 years. So, she was still at a loss. At least, I am not most brokers or business advisors with no conscience.

Still think you want to trust others with your money? I call it writing blank checks. Just come on board with me, but be prepared to write some blank checks so we can make your business venture work. And...stay away from those investors who tell you that passive investing is safer and better. Passive investing is where you write checks and let someone else purchase properties and manage them for you. Always control your own money. When you do passive real estate investing you give someone else full control of your money.

Put another way. After you give a person (or company) your hard-earned money for passive investing you have to cross your fingers, hope the person is competent, honest and can give you the return (profit) promised. Unfortunately, you did not consider the risks and poop happens.

It takes a long time and hard work to earn money. It is super simple and quick to lose what took you a lifetime to earn.

I purposely avoid telling new investors that investing in real estate is easy and avoid telling investors they should give investing a shot when potential investors are asking questions that make it apparent that these people are not ready to risk their money. Not all money is good money. Many people get into real estate only because they want to earn more money, but a large percent of investors who make decent money hate the real estate business with a passion because they don't have all the qualifications they should have to be in the real estate business. Many landlords don't know how to maintain properties, don't know how to do the record keeping and they hate their tenants with a passion. Many investors make good money, but they are miserable.

There are several serious assets a person should have before they jump into real estate investing such as:

a) enough cash to handle the unexpected repairs, vacancies, tenants who don't pay rent and legal costs,

b) enough math skills and many other experiences about properties to understand whether or not the purchase of a property will result in a profit,

c) enough math skills to calculate your profit at the end of every year and this includes understanding enough math to calculate your profits from depreciation, rent income, rent increases, property appreciation and increased property value that results from rent increases e.g. using the Gross Multiplier.

d) the mental maturity and skills it takes to deal with tenants who, who destroy your property, don't pay their rent and then to deal with evictions and attorneys without getting stressed and going insane.

e) be knowledgeable about real estate rent laws and

f) ability to produce accurate bookkeeping records for banks annual audit and the IRS audits.

So, when many people ask if the real estate business is good to get into I don't think it is right to just tell people, "'Anyone Can Do It".

Just to clarify are you stupid or uneducated? There is a difference, because uneducated can be solved with education. Stupid implies you are slow to learn and make bad decisions. If you are actually stupid, then owning a business can be a big mistake. If you are just uneducated, the answer is get educated. Listen to podcasts, read books and start educating yourself. 

Truck drivers are in high demand right now and starting pay at some companies is over $60K. Starting pay is actually better than many college degree jobs. It is also lots of time on the road. That is a perfect opportunity to get an education on wheels, meaning listening to podcasts, real estate books and programs while you drive.

I know people say that anyone can do anything, but that just isn't true. We all have different strengths and weaknesses, so not every job or business suits everyone. One option is to start small. You can just rent out a room or two in your house and get experience. I would also caution you when you say properties are inexpensive in your city, because low cost properties often come with management intense tenants and more problems in general.

@C. Buzzetta

The first step is to believe in yourself. Sounds like you are getting there. You can do this, it isn’t rocket science.

The next step is education. Sounds like you are working on that. Keep at it. Rich Dad is a great start. So if BiggerPockets!

Sounds like you have a good work ethic also. That is the next thing you need. Every day put in the work and read something new. Even if it is only for a few minutes.

It will all fall into place. Don’t give up, just keep pushing forward! There is a huge community of people on this site that are willing to help!

I remember reading a study they did sometime back where they had monkeys throw darts at a dart board to pick stocks. The monkeys were able to out perform "professional" stock pickers with fancy degrees. So I guess anything is possible.

I don't "love" real estate. I see it as a means to an end. That end is making enough to pay utilities, living expenses and to get health insurance. I could easily live on $20,000 a year. I thank all of the Bigger Pockets respondents, who took the time to give me their advice. Especially those who did not sugar coat their answers. Could a BP investor perhaps shoot a video series of RE deals (house hacking, rentals, flips, etc.) from start to finish so that newbies like me can get a little taste of what it's like. I understand real life is not scripted, but at least people could actually see the basic mechanics of what a deal is like. Am I terrified of taking action? Hell yes! I'm not young or invincible anymore. Perhaps it is true that fortune favors the bold.