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Updated over 10 years ago, 08/12/2014
Your Goals - How Have They Evolved?
- How have they evolved?
- What are they now?
- Building my Knowledge Base -- Attending Local REI Clubs, Frequenting BP
- Building a solid track record and learning to raise capital.
- Contributing 35+% of my take home pay to REI, continue living simply, returning all RE proceeds to new deals. The excitement of the deal will have to be the payoff, maybe a nice dinner with partners to celebrate that, but I cannot lose sight of long term goals.
- Only completing deals where the sum is greater than the parts
- The deals must meet my criteria and be a win-win-win
- Tenants must win
- Community must win
- Potential Partners and I must win
- I'll begin small 4 unit MFR's and progressing to Larger MFR projects where I can force appreciation through rehab/renovation. I refuse to own and grey boxes! The spaces must be uniquely positioned in the market.
- I need approximately 278 Doors each cash flowing $150/month to accomplish this.
- I will need a team including several FTE's.
- The deals must meet my criteria and be a win-win-win
- Quitting the 8-5 corporate world once the opportunity cost of my REI Activities exceeds my salary.
I would like to hear about the goals everyone set, when they started out.
I'm having a hard time with the S.M.A.R.T. goal setting methodology. Particularly the "R" or reasonable part - I want to think BIG! which I know may seem unrealistic, but I also know if I don't aim high I sure as heck wont get there! What are everyone's thoughts on "Unreasonable" Goals? Any words of wisdom from those who have built large REI MFR businesses?
My Short Term Goal is to acquire (Two ) 4-plex's in 2016 with 25% down, that cash flow at least $150/unit/month, all accumulated cash flow will be reinvested.
My Current Long Term Goal is:
To have an Income from REI of $500,000 by 2025.
To Accomplish this I will be:
Back Story, I'm a single 27-year-old IT Manager, Minimal assets focused on debt pay down. Debt will be gone in 17 months, and I will begin investing 40% of my take home pay and 100% of my Annual Bonus.
I read once that Sam Walton was so certain about the fortune he was about to build that he met lawyers and accountants and setup all of his tax /estate planning before hand. I may do the same before I acquire my first property.
TL;DR I'm going to make $500,000/yr in 11 years, starting from $0 Have I lost my mind ?
Thank You All!
My goals are no longer about an number of units or an amount of money. They are now about my lifestyle.
The last line, you said you are going to make $500k in 11 years. Why $500K? What kind of lifestyle will that provide? Could you get the life you want with only $450K a year? Or is $500K an arbitrary number that you assume will make you happy when you reach it? Something to think about.
If this has made you think you might want to pick up the Book Lifeonaire by Steve Cook. It is a life changer.
Originally posted by @Ned Carey:
My goals are no longer about an number of units or an amount of money. They are now about my lifestyle.
The last line, you said you are going to make $500k in 11 years. Why $500K? What kind of lifestyle will that provide? Could you get the life you want with only $450K a year? Or is $500K an arbitrary number that you assume will make you happy when you reach it? Something to think about.
If this has made you think you might want to pick up the Book Lifeonaire by Steve Cook. It is a life changer.
Ned Thanks Good Point on lifestyle. I calculated my lifestyle number at 240k, based upon my "Ideal lifestyle budget" , I then doubled it and rounded up. I cant remember where I heard to double it but it seemed like good advice.
Like the lifestyle comment.
@Ned Carey makes a great point that I see on here a lot. I think figuring out what you actually want to accomplish is a better starting point than having a number of units or cash. I think my method has changed a lot more than my goals.
Originally posted by @Pete T.:
@Ned Carey makes a great point that I see on here a lot. I think figuring out what you actually want to accomplish is a better starting point than having a number of units or cash. I think my method has changed a lot more than my goals.
I share the lifestyle sentiment above, those numbers are about what the lifestyle they bring. I wanted to define it in dollars, instead of just saying what I want my life to look like. The number of units are to give me a rough approximation of what I need to do to get there.
Measurable goals are helpful. Qualitative goals are good, but can be harder to check off a list. We should use both kinds.
Originally posted by @Jon Klaus:
Measurable goals are helpful. Qualitative goals are good, but can be harder to check off a list. We should use both kinds.
Jon -- I like this approach best! I now find myself trying to quantify my qualitative goals... shucks.
Originally posted by @Account Closed:
Originally posted by @Jon Klaus:
Measurable goals are helpful. Qualitative goals are good, but can be harder to check off a list. We should use both kinds.
Jon -- I like this approach best! I now find myself trying to quantify my qualitative goals... shucks.
Start with WHY? It's a big question that requires a lot of soal searching.
I agree Jon, but I think you need to start off with the WHY to figure everything else out.
One of the things I love about bp is looking into the worldview of others I can relate to. There are very few people who will understand this process you are going through. I wish I had this resource when I started.
When I started in 2006 I set my goal at $5000 per month in net income as a passive real estate investor. Since then I have had to double that number. Now my goals are like @Ned Carey. You need numbers to make your goals measurable but it will be come less important as you start meeting them. My goal now is to provide for my family through my real estate investing and have freedom to set my own schedule and commitments. There is a dollar value attached to that and a number of rental units. It is important to know what you are working for. (It gets hard at times...)
I would not worry too much about the R. I have not met any of the original timelines I have set. I love the saying, "It doesn't hurt to land on the moon when you are shooting for the stars" or something like that. You will be amazed at what you do accomplish. I have had to review and revise my goals as time went on and I learned through experience what was actually possible.
I like your goals. Just as an FYI. Sam Walton's first venture failed , but he prevailed.
Onward an upward to you !
I have shot for the stars but feel I've landed on the mountain. I really have come a long ways but not nearly where I wanted to be at this time. I still have so much to learn, even though I've learned a lot more than I knew when I started. My goals have only changed in the way of larger goals on the financial side and delegating plans for operation side. These changes I am planning to accomplish through the growth, and the changes in operations will increase income potential even more. That's also where I get a little mixed up. Which should come first, and learning to delegate the things I do or keep working long hours to gain money for the fix and flips. We have been shifting more of the field work to our subs and it has helped considerably. I ended up helping a lot due to the distance of one of the properties we were working on. We now have that wrapped up and I'm back mostly in the office. We got so busy on the preservation side of our business that I feel the flipping side of it was put off. Now I am able to find time and interact on BP again, read and learn as much as I can. Also have time to pursue what I need for the property we want to flip. Good thing about the last few months is we made quite a bit of money to put towards the fix and flips.
When I first started, I had no goals. Back in 2009, I sort of approached real estate investing from an angle of "I doubt the real estate market will ever go into the crapper this deep again, so throwing some cash in it at its lowest point made sense." I have always tried to invest according to the principle:
"When everyone is greedy, be cautions; when everyone is cautious, be greedy!"
I follow the same principle when investing in the stock market as well. I am in the Detroit Metro area. At that time, things were very rough here. The loss in property values was tremendous and the market was over-saturated with cheap houses, REOs and desperate sellers. Seemed like the perfect time to throw some money at it as all calculations I made, pointed to the fact that short of some catastrophic chain of events like Detroit Metro becoming a ghost town, it was going to be hard to lose money. Not knowing squat about real estate investing, I bought my first SFR within walking distance of my home and figured I'd give landlording a try.
The rest is history - I kind of got hooked and have been searching for deals ever since. As for my goals... well I have a great a career which provides a nice lifestyle so I am having a hard time imagining walking away from that at this point in my life. However, if I was to articulate my objective related to my real estate investing, it would go something along the lines of "generate enough income to have the option to quit one day (if so I chose) and not have to change my lifestyle". I am not there yet nor am I actively pursuing this at the moment so I haven't even calculated what that means in terms of actual dollars.
My point is... having goals is great! I admire the fact that you are thinking about that, but sometimes great things happen by just taking a chance at something new.
Good luck to you!
