As I was making my breakfast this week, I heard a commercial on the radio about a guru coming to Philadelphia to teach people how to flip properties in two hours with no money down. During this two-hour seminar, he was also going to teach how to buy rental property with no money down as well.
All of this in just two hours!?
I just listened to this commercial and smiled, thinking, “I wish these topics could be taught in two hours — but there’s simply no way to do this! To even promise this is completely ridiculous.”
As I have learned over 10 years of investing, this business takes a lot of knowledge, education, and continuous improvement. It also takes sacrifice—and that is one topic most of these gurus don’t include in their 2-hour seminars. They just paint the picture that real estate investing is easy and that once you set up all your systems, you can just go to the beach, sip cocktails, and collect your rent checks.
I hate to be the bearer of bad news, but it just doesn’t work that way. Real estate investing is more of a marathon than a sprint. You don’t start receiving checks overnight. It comes with a lot of sacrifice and delayed gratification. Although there is sacrifice involved, real estate investing can help you achieve a lifestyle that gives you freedom of time and money. However, new investors need to know that this takes sacrifice.
Before we get into the common areas of sacrifice, I want to discuss briefly the word “sacrifice.” Sometimes this word does not have the most positive feelings associated with it. I really like how Merriam-Webster defines it:
An act of giving up something that you want to keep especially in order to get or do something else.
Let’s face it—most people invest in real estate to create a bigger vision for themselves, their families, and their lives. They don’t invest in real estate to stay small. So, in order to gain something larger in your life, you will have to make different choices, sacrifice areas of your life, and do what most people choose not to do!
So, let’s get to the list of areas that you will have to consider sacrificing in order to move to a larger vision for yourself.
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1. Leisure Activities
This one probably does not come to any surprise, but yes, your free time will be affected (especially at the beginning). Real estate investing is like starting your own business. I don’t know many successful entrepreneurs who watched 20 hours of TV in a week AND simultaneously started a multi-million dollar business.
Many things in our world are unlimited—money, resources, solutions, etc. The one limited resource is time. We all get the same amount of time to use as we choose. So how do you spend your time? Whether you want to grow your real estate business will be a question you will have to contemplate and assess. I am not saying the sacrifice is working 100 hours a week and not doing anything but work on your real estate business. I don’t think that is healthy or smart. If you do this, you will have no relationships. However, you have to be super careful and mindful of how you spend your time and make smart time decisions so that you can grow your business and achieve the goals you set out to achieve.
2. Control Over Time
You will also have to sacrifice what I call “time control.” In a typical 9-5 job, you have time control. You know when you have to be at work. You know how much time you have for breaks, lunch, vacation, etc. You get paid for your time.
In the world of real estate investing and entrepreneurship, you do not get paid for your time; you get paid for results instead. These are very different worlds, to say the least. There are many people who quit their jobs and become very frustrated because this business is not “time controlled.” To be successful in this business, you have to be flexible with your time, get rid of the 9:00a.m.-5:00 p.m. mentality, and do whatever it takes to get a project to completion (no matter what).
Money, money, money. Many people invest in real estate to create money freedom for themselves. And yes, real estate investing can get you there. However, you will need to sacrifice how you spend your money along the way. Back in 2005, in the same month my husband Matt and I got married, we decided the best thing for our real estate investing business would be for Matt to quit his safe, secure job. We bought a house and lived below our means in order to make this happen.
Fast forward to today. Yes, we go on vacation, go out to dinner, and enjoy life. However, we also choose to use our money differently than many other people we know who are not real estate investors. We invest our money and other people’s money in real estate. Sacrificing your money will mean that you make different decisions and choices with how to spend your money. We do spend money on fun things, but we don’t go crazy. We never have.
With this particular sacrifice, it is helpful to know exactly how you manage and deal with money. If you have a partner, you need to know their relationship to money as well. We attended a great personal growth weekend called The Millionaire Mind Intensive. We learned that my husband is more of a spender, and I am a saver. This distinction has helped us tremendously over the years when we have differing opinions on how to spend or save our money. Bottom line—in order to get what you want to get in your real estate investing efforts, you will need to make different decisions with how to both generate and use your money. It is all about where you want to go and what you want to create.
This is another big sacrifice that most real estate investors will have to let go of as they grow their real estate investing business. Security and freedom are two very different things. It is hard to get both of these at the same time. We made a conscious decision many years ago to let go of security to gain freedom.
However, this is a tough one for many, many people. I talk to a lot of real estate investors, and the successful ones always seem to value freedom over security. Now, that does not mean you won’t have any security or develop security as you grow your business. Yes, we have more security now than we did when we started our business. We have children now (and one on the way), so some security is important to us, but freedom has always been more important to us. You need to determine what you value more—security or freedom. Typically, people sacrifice one for the other.
This was probably the biggest sacrifice we made early on. When we left our jobs, we both were making good money. When my husband left his corporate job, he had a company car, company expense account, high salary, and was on track to get promoted within the year. However, none of that motivated us. We wanted to create a life of freedom and independence. We valued this more than the salary.
Yes, when you have a job, your income is more predictable. However, what we have found since we have been self-employed for many years is that there is more upside potential when you run your business and create your own destiny. You are in charge, and you are responsible for your success or failure. Something I suggest to many people looking to quit their job to invest full-time is to get a very detailed sense of your expenses. What do you really need to live on? This is important to analyze and assess before you leave behind that salary.
I hope this list was helpful to you as you continue on your path of real estate investing. Sacrifice is not necessarily negative. Sacrifice can lead to a bigger and grander vision of your future.
It is all about choices.
It is all about what is important to you.
And most of all, it is all about the reason you are doing all of this.
If you are not absolutely clear on this, then don’t even get started. But if you do get clear on all of this—your “why,” your goals, what is important to you—then go for it. Keep this in front of you when you come across those challenges, keep going, and don’t ever, ever quit. In time, you will be grateful for all the sacrifices and step into that grander vision.
What are some other sacrifice’s that I might have missed?
I would love to get some chatter going! Thanks for reading and happy investing.