Do you believe in having a plan B

15 Replies

I believe that there is a small number of people who succeed in difficult things who indeed hold the belief that, "Having a Plan B means you believe you're going to fail with Plan A." There is something to be said for the quality of fire lit under your a$$ when operating without a Plan B.

I also concurrently believe that many people who do not allow for the possibility of failure in their lives are suffering from a cognitive dissonance and when they do fail, the failure breaks their minds and they rarely fully heal in the broken places.

I believe consistently successful people have a dark and secretive cynical part of themselves that knows when they're cheering themselves on in a limited way to complete a difficult task and when they're lying to themselves. They are therefore able to deploy a kind of limited schizophrenic mindset in their working lives to push themselves a fair bit past what others would consider normal limitations.

I believe autobiographies of success are not to be trusted. Nobody ever admits unforced to doing very bad things, and very bad things very often lie at the dark heart of many varieties of success. How many times have you heard a flag-waving loud-n-proud Murica-Murica chanter admit that this foundations of this country firmly rest on two of the greatest crimes against humanity in the history of the world, the genocide of the Native Americans and the African slave trade?

I take deep issue with the two stories that are usually used to discuss the philosophy you're talking about: Alexander the Great burned his boats after sailing up the Hellespont into Persia and Hernán Cortéz burned his ships after landing in Mexico. Both of these leaders did this to convince their followers to toe the line, not to convince themselves.

Survivorship bias is, as Wikipedia describes it, "The logical error of concentrating on the people or things that made it past some selection process and overlooking those that did not." There's an awful lot of survivorship bias in discussions about success.

I think it depends on what your idea of a plan B is and the situation.  If you are starting a small business then NO you don't want a plan B.  It's your business you go "All In".  I am willing to sleep out of my car to make this thing work. 

As it pertains to property investing. Your plan B is the investing part. Your plan A is your real life job and going through the rat race. Yes, I do believe in having a plan B in this case which fits pretty much all investors.  I am planning things because I know my A could fail in the future. 

Originally posted by @Jim K. :

I believe that there is a small number of people who succeed in difficult things who indeed hold the belief that, "Having a Plan B means you believe you're going to fail with Plan A." There is something to be said for the quality of fire lit under your a$$ when operating without a Plan B.

I also concurrently believe that many people who do not allow for the possibility of failure in their lives are suffering from a cognitive dissonance and when they do fail, the failure breaks their minds and they rarely fully heal in the broken places.

I believe consistently successful people have a dark and secretive cynical part of themselves that knows when they're cheering themselves on in a limited way to complete a difficult task and when they're lying to themselves. They are therefore able to deploy a kind of limited schizophrenic mindset in their working lives to push themselves a fair bit past what others would consider normal limitations.

I believe autobiographies of success are not to be trusted. Nobody ever admits unforced to doing very bad things, and very bad things very often lie at the dark heart of many varieties of success. How many times have you heard a flag-waving loud-n-proud Murica-Murica chanter admit that this foundations of this country firmly rest on two of the greatest crimes against humanity in the history of the world, the genocide of the Native Americans and the African slave trade?

I take deep issue with the two stories that are usually used to discuss the philosophy you're talking about: Alexander the Great burned his boats after sailing up the Hellespont into Persia and Hernán Cortéz burned his ships after landing in Mexico. Both of these leaders did this to convince their followers to toe the line, not to convince themselves.

Survivorship bias is, as Wikipedia describes it, "The logical error of concentrating on the people or things that made it past some selection process and overlooking those that did not." There's an awful lot of survivorship bias in discussions about success.

in real estate you need Plan B  then follow that up with Plan C  then follow that up with plan D...  if you don't and your going to own this stuff over decades each of those plans will come into play at some point.. real estate is not a linear line straight up.

I was on a Con call last week putting a large financing deal together on a 500 home project. half the call was about plan B and C if the original sales channel dried up.. 

When banks appraise development deals there are always plan A B C or values for each..  A is it goes the way I say its going to go.

B is we had a slow down and now the value is this.

C is all hell broke loose I failed and the bank has to sell it in bulk so you have a bulk value. 

People who take on very hard challenges have to try many plans before they reach success.  They "fail" their way towards success...it's skill development.  Many don't try...or they try and then quit when they hit a bump in the road.  We all do it.

Originally posted by @Mike Dymski :

People who take on very hard challenges often have parallel, duplicate, and alternative plans so they have all bases covered.

FYI...most people don't plan anything (other than a Friday night).

 very true...  

You always need a Plan B and C and maybe even D for everything you do. The reason is you can't control everything. There are things in life that will happen that are completely out of your control. Market crash, house burns down, a family member dies, your in a car crash, etc. You dont design back up plans so that you have a so so business/project if your original idea doesnt work. You design them to keep you afloat or to minimize losses in worst case scenarios. 

You dont want to get in a crash and be stuck in a hospital for 6 months and cant work on your reno and THEN say oh ****...I need to think of a Plan B! Not only is that too late to make it a Plan B (it will more than likely really be a Plan D or E when you compare the loses) it will be extremely more stressful of a situation than if you had plan for something like this in the beginning. 

For my current house I have under contract I have a 5 backup plans with cascading scenarios that get worse and worse. And even the worst one I still break even. Now this is probably overkill but my wife is not as risk adverse as I am so I needed to show her all the ways this could not go as planned and how we will be ok even if all hell breaks lose. 

I've had a LOT of Plan B's over the years. Many of them remain 'stealth' plans thus avoiding full disclosure to the wife, until after the recovery.

@Greg Raymond yes, in real life Plan A doesn’t always work out. Then what? Heard a saying that stuck with me over the years: “Blessed are the flexible for they shall not be broken.” In life, relationships and in RE investing flexibility is important.

@Greg Raymond This is a very broad question but a very good one. In my opinion when you have a Plan A, that is your ultimate strategy to achieve a goal. There are unexpected events in life and in business that may cause you to resort to a Plan B, but to me it’s not a totally different plan. It is a course of action to take in order to get back on track to execute Plan A.

@Greg Raymond

I live by that quote about burning boats.

But like the others said things change.  So I don’t go in with two plans or two goals but I do change strategy if needed.  

The other quote I love is .....

if we cannot find a way we will make a way. 

I look at it a bit differently. The first flip we did, which was our first move in rei,  I tried to plan for every possible outcome. We could sell it, rent it, move into it, etc. That was my preferred order. I didn't have tv at the time, didn't know about bigger pockets. I bought a book, and had been building houses for 15 years. All of that was plan A. To me, plan B is trading bitcoin. In football, each play is a plan, but there are different options, depending on what the defense gives you. I am a firm believer that you need to focus on a plan A, and then decide how to best play to your strengths. The part I struggle with, as I am persistent to a fault, is the line between persistence and beating your head against a wall. 

Originally posted by @Frank Wong :

I think it depends on what your idea of a plan B is and the situation.  If you are starting a small business then NO you don't want a plan B.  It's your business you go "All In".  I am willing to sleep out of my car to make this thing work. 

As it pertains to property investing. Your plan B is the investing part. Your plan A is your real life job and going through the rat race. Yes, I do believe in having a plan B in this case which fits pretty much all investors.  I am planning things because I know my A could fail in the future. 

Good post overall.  I've been making a steady 48-60k as a teacher for over a decade now, and it's not terrible money,but the ability to replace that in real estate is just too strong of a draw. 

And btw, sometimes the "rat race"  can eat you alive.  There aren't many easy jobs out there, but trying to teach 160 + students every year that don't care about anything in life but their cell phones and being disrespectful is ruthless.  No wonder the average career for a teacher is 6 or 7 years. 

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