What is your standard of determining goals?

Question

Hello everyone my name is Miles Smith, I'm about to be 18 and am going to be an real estate investor. My question is how do you guys determine goals? I am trying to get my goals and time frames set up and want to see how other people have done it themselves. I am deeply in love with cars, and so I was looking to see if making goals on a standard of cars rather then dollars or monthly income is an advisable way to set up goals. For example I want a 2016 Ford Mustang GT350, I was going to do my goal by saying in 2 years I will be able to purchase my Mustang and afford it purely from rental income. As I get more and more profitable rentals, and cars were purchased they would change to hopefully progressively more and more expensive vehicles. Would you recommend this as a strategy or would traditional dollars be more advisable? For example, in 2 years I will make $1,500 a month in rental income. Thanks for the advice ahead of time!

Fasil Khan · Answer

I recently read 10x by Grant Cardone, who says 10x all your goals and write them twice a day, once in the am and once at night, which equates to 722 times a year and I am sure you will hit all your goals. He also has a show for 18-32 years old called young hustler I would suggest following him if I knew about him at your age who knows what my goals would be. This man has a real estate portfolio of 350 million plus 3 companies and aim for the sky, I am sure you will be successfu!

Bettye Chambers · Answer

Miles Smith I understand. Kudos to you. At the age of 18, I was not even in the same mind frame as you. That being said, your motivation for investing in RE is to support your passion. As you grow older & wiser, your priorities in life will change.

Tom V. · Answer

The first goal is to acknowledge that a simple monetary pur,hase will not make you happy. A different goal might be to find something you like doing, then figure out how to make money doing it. Then help someone else do it. Life is a long time. Whatever car you buy this year will not be cool in 5 years. Try to figure out what it is you want to do.

Matthew A Rodriguez · Answer

Invest:to put (money) to use, by purchase or expenditure, in something offering potential profitable returns, as interest,income, or appreciation in value.Believe me, I do recognize the desire to acquire things that I am passionate about. I don't fault you for that. It's a poor model to pair any capital gains or cash flow into things that will cost you money. Not a sustainable business model. The best, most well known, and richest investor in the world knew the meaning of this. Warren Buffet named his first jet "the Indefensible." In his mind at the time, he realized that owning a jet like the other CEOs was more of a waste of money than anything. It wasn't until he had an actual need for one that he changed the name to "the indispensable." He used it as a vehicle to aid him in making more money. Set your goals higher and implement that GT350 later on down the road.

Nicole Jones · Answer

@Miles SmithI totally hear @Matthew A Rodriguez, sounds like something I would say... but no judgement. I'm sure a lot of RE investors are guilty of using their profits to indulge in many depreciating "whatevers" About your goal, for me it seems a bit confusing but I see what you're getting at. If it was me I may keep my investing goals separate from my purchasing goals. One goal I have right now, just to keep moving ahead, is to make a commitment to purchase 2 properties a year with a certain cash flow (I use a few different types of formulas and calculators to come as close as possible to guaranteeing the number I'm looking for). That's my moderate investing goal. About the cars, (again, if it were me) I might use it as a reward system. Once I have such and such dollar amount saved, I will purchase such and such car, not to exceed such and such amount. I have had the same car for almost 10 years and I fee like the coolest girl ever because I haven't had a payment for the last 8 years. When I need a car I'll probably splurge and buy something nicer, but something that is a few years old just to buy at a better value. Brand new cars have way over-inflated pricing. You might as well throw a briefcase with a few thousand dollars out the window as you drive off the lot. But I'm sure you've heard all of this before. As I'm sure applies with all investors, I would rather use the majority of my nest egg for re-investment but like you said it's your passion so... don't feel guilty for it. Good luck on future investing!

Rocky V. · Answer

STOP thinking like a poor boy. There will always be new flashy cars that you must resist the temptation to purchase. @Matthew A Rodriguez is correct that you are funding depreciating assets with appreciating ones which is a huge red flag. I had to resist the temptation for many years of seeing my friends and neighbors all driving the newest/shiniest car. I always thought to myself that I could purchase another rental for the same monthly payment of a car and have now accumulated enough rentals to live well. Just last year I finally purchased two new vehicles but I have enough in reserves to write a check for both. Best of Luck!

Matthew A Rodriguez · Answer

So your goal is to invest in appreciating assets to parlay in depreciating liabilities?

Bettye Chambers · Answer

Miles Smith I understand. Kudos to you. At the age of 18, I was not even in the same mind frame as you. That being said, your motivation for investing in RE is to support your passion. As you grow older & wiser, your priorities in life will change. Right now, learn as much as you can and as your priorities change, you'll be okay.

Nicole Jones · Answer

@Matthew A Rodriguez it sho is :)

Nicole Jones · Answer

@Miles Smith I totally hear ya. It's a valid statement. I guess it may just be a balance. Because someone might say... are you really an investor, if you're not "investing" I say whatever strategy works for you to keep you motivated.