As you may know I like to make the beta reading of my book open sourced so the community that will be using them can actually gain the information and request changes or additional information to be added as the book is being written.
This post is One Chapter of my coming book, “GET THE DEAL”. Which the idea has it’s origins from the live training with the same name that I have taught to thousands of real estate investors all across the country and have had time to refine the information to answer the questions most asked at those trainings. Without further ado I want to encourage you to read this chapter and leave your suggestions in the comments below!
Setting Your Goals
“If you really want to do something, you’ll find a way. If you don’t, you’ll find an excuse.”
– Jim Rohn
I put a lot of thought into the quotes used at the beginning of each chapter and this chapter is no different. This chapter on setting goals is discussing the most important aspect in real estate. Because I have a habit of listening to Jim Rohn everyday when I first wake up I decided to give him this pivotal chapter. I had the hardest time, because so many of my favorite quotes are focused on the importance of goals and having vision to move towards them.
My first real estate investment goal was to acquire 2 rental properties in 2 years, but it was only a part of my then larger goal of having 4 multi-families which I believed was all I would really need to reach financial freedom. As I moved toward this goal of financial freedom there were plenty of opportunities for me to give up, but that vision of financial freedom kept driving me forward even in the darkest of hours.
I can still remember the feeling like it was yesterday. I had just received the text and I knew she meant it because she had been asking for months now, “I am serious, I want a divorce. No there is nothing you can do about it, I just don’t want to be with you”. I was crushed. I remember walking across the drop-clothe covered floor of my second vacant apartment. I was in the middle of renovating it for a tenant that I hoped would exist when it was done.
Finding my way out of the kitchen over to the living room where my tools were strewn across the apartment for the different projects I was working on. I finally sat down on the covered paint bucket, dried my tears and felt the deepest emptiness I have ever felt. I had convinced myself that everything I was doing was for my relationship, and here I was completely empty, jobless, alone, and for a brief moment I considered that there was no point in living anymore. I had put everything into this dream and it just came crashing down on me.
The next thought was of my brother and my father who I knew would be crushed if I did something so selfish by just giving up. Seconds passed, minutes, an eternity. To this day, I don’t know how long I sat there feeling empty, but slowly my body started moving again. My legs moving by themselves like a machine. I started moving back across the half renovated apartment, feeling like a soul-less creature barely breathing. I was looking for something, anything to keep me here, to give me purpose again.
As I reached the counter I placed both my hands on the sink and looked out the window. Maybe the answer was out there. I could see the other buildings that I wanted to buy. The ones I had put offers in on and suddenly I KNEW they were already mine. Just as suddenly as that awareness came to me it was followed by the most clear understanding that I would be an influential landlord in this city one day and that when I reach financial freedom I was going to teach people how to stop money from ruling their lives.
I had seen money as the most important object in my life and had been willing to sacrifice anything to understand it. When the reality of what I had given up in order to reach this goal hit me, I became aware that there was a better way. A way that didn’t have to be so difficult or require so much pain. All of these thoughts flashed into my brain and were gone as quickly as they came, but the memory was there just out of sight.
The reason I tell this story is to let you know that even your best laid plans can fall apart and sometimes the goals you set are not the healthiest ones for you or the people you care about. I want you to be very clear with yourself as you continue through this book. What do you really want to accomplish and WHY it is so important for you.
That day in the apartment I caught a glimpse of my true “why” and it gave me the fuel I needed to find myself again in that moment and every day since. Over the years since that day I have spent hundreds of hours in deep contemplation of my why and how to better work towards it. Keeping myself and my companies in line with our vision for creating more wealth for real estate investors and maintaining a strong focus on creating more time for them and the people closest to them is at the core of everything we do.
The greatest companies in the world focus on having a strong why for themselves, their partners and the people they serve. Your investment success will suffer or thrive depending on how strong your “why” is. Let’s dive deeper into how you can discover your “Why” with a little case study on a company with arguably the best “why”.
What Real Estate Investors Can Learn From Apple’s “Why” Driven Philosophy
Simon Sinek makes the strong case that the vast majority of businesses, and people for that matter get things backwards. Namely, they start with WHAT and end with WHY, assuming they ever get that far in the first place.
In his book, “Start with Why”, he describes how a company should operate within what he calls the “the golden circle,” which starts as a circle with 3 smaller circles with each titled What, How and Why.
WHAT: Every single company and organization on the planet knows WHAT they do. This is true no matter how big or small, no matter what industry. They are easily able to describe the products or services a company sells or the job function they have within that system. WHATs are easy to identify.
HOW: Some companies and people know HOW they do WHAT they do. Every sales person is trained to know their, “unique selling proposition”. HOWs are often given to explain how something is different or better. Not as obvious as WHATs, many think these are the differentiating or motivating factors in a decision. It would be false to assume that’s all that is required. There is one missing detail which is WHY.
WHY: Very few people or companies can clearly articulate WHY they do WHAT they do. “When I say WHY, I don’t mean to make money because that’s the result. By WHY I mean what is your purpose, cause or belief? WHY does your company exist? WHY do you get out of bed every morning? And WHY should anyone care.” (Simon Sinek)
This sounds in many ways like the mission statements that have become so popular of late. But while this may come off as more mindless corporate mumbo-jumbo, answering this question is critically important. And no, just writing some mission statement down and putting it away in your desk never to reference again doesn’t count.
Jim Collins echoes this same sentiment in his book, “Built to Last” when he notes that, “Profitability is a necessary condition for existence and a means to a more important ends, but it is not the end in itself for many visionary companies. Profit is like oxygen, food, water, and blood for the body; they are not the point of life, but without them, there is no life.” It shouldn’t come as much of a surprise that Collins finds the companies that believe this and act on this belief perform the best over the long run.
With this in mind, let’s return to Simon Sinek’s argument to “start with why,” and he finds the best example of this mindset in the on-again, off-again biggest company in the world, Apple. Sinek notes a normal computer company’s ad might go like this, “We make great computers. They’re beautifully designed, simple to use and user-friendly. Wanna buy one?”
It’s a very WHAT driven message. On the other hand, Apple’s message starts with the WHY behind the company, “Everything we do, we believe in challenging the status quo. We believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use and user-friendly. And we happen to make great computers. Wanna buy one?” For an example of this, just think back to their 1984 Super Bowl ad that took on Big Brother.
Apple’s WHY sets the tone that allows Apple to both design innovative products over and over again and also to demand such loyalty from their devoted followers (and also charge a premium for said loyalty).
On the other hand, Sinek describes Wal-Mart, which he believes lost its WHY after its founder Sam Walton died, “In the post-Sam era, Wal-Mart slowly started to confuse WHY it existed which was to serve people. With HOW it did business, which was to offer low prices. They traded the inspiring cause of serving people for a manipulation. They forgot Walton’s WHY and their driving motivation became all about ‘cheap’ The company once renowned for how it treated employees and customers has been scandal-ridden for nearly a decade.”
Wal-Mart is still a huge and profitable company, but even in that department, the company is becoming a bit sluggish. I like these examples because I worked for Wal*Mart for 3 years which covered both the time Sam Walton was alive and I left the company shortly after his passing. Also my business partner Ron Boling is a big fan of all products Apple and which is often a point of contention for us during our weekly “Power Meeting” where we focus on our WHY and the direction our companies are moving in.
Why Focusing on “What” Can Lead to Mediocrity
The point for everyone in business and real estate investors in particular is that getting caught in the WHAT of business can become a feedback loop of mediocrity. It can also tempt you to cut corners.
Our mission for our investment company is to “Build 100 Millionaires who will commit to building another 100 Millionaires.” Our goal company-wide is to “build a 10,000 unit Real Estate Investment Trust to help successful real estate investors fast-track their retirement”. We just happen to provide training for real estate investors and clean and safe housing to good quality tenants who always pay their rent on time and love where they live”.
We expect a lot from ourselves, and therefore, we expect a lot from the people we work with. It holds us accountable and keeps everyone moving in the right direction.
As far as the business goes, I would be the first to admit that our WHY could use some more specificity, but I’m not simply settling for something like “I buy houses” and you shouldn’t either. Yes, we do buy houses, and that’s just the WHAT. When we see an apartment building or a large portfolio, we always look at it first and ask the question will this help us build 100 Millionaires? In most cases if the numbers work then the answer is yes, because our property managers and contractors will be increasing their income. Our income will rise helping us market to more investors. We may learn a new strategy or make new connections that we can share with our investors and we may be able to bring on new partners who can join in the bounty of our harvest.
I should note this is also why we focus on both a buy and hold strategy for the long term growth as well as including flip rehabs, teaching wholesaling and transacting as real estate agents in the communities we operate in. I strongly believe this is the best path to building 100 Millionaires who will build their businesses around the concept of building their own 100 Millionaires with all of us eventually retiring our portfolios into a 10,000 unit REIT that provides clean and safe housing to good quality tenants who always pay their rent on time and love where they live.
Now that you have an understand of how important a strong WHY and Vision is for your company, lets talk about the power of visualization and a popular tool in the success arena is the vision board.
The Power of Vision Boards
While I was researching other real estate investors experience with the power of vision boards. I stumbled across a post by one of my good friends Mitchell Jaworski a Rental Property Investor from Boynton Beach, FL who is also a major player in real estate and an active coach in our Real Estate Alchemist community. I’ve copied his post verbatim posted over 5 years ago:
“I’m sure everyone has experienced this; you are preparing to move and comes across items and belongings you have not looked at in quite some time. Many make you reminisce, but every once in a while one provides a “light bulb” moment.
If anyone has read the book “The Answer” you are familiar with a Vision Board. Basically, it’s putting up pictures of your goals somewhere you will see it daily.
For all of 2013 I had three pictures printed out on a piece of paper and taped on the wall next to my computer where I sat every day. The picture was to my right and was in my periphery. So even if I wasn’t looking directly at it I still saw it, realizing it or not.
One of the pictures was a 2/2 condo with a garage in a nearby neighborhood. I wanted a property with those parameters. The goal was never for that specific community, it was more an example.
In early 2014 I moved into a townhome that I’ve since turned into a rental property. The printout was filed away at that time – I have not seen it since. Until today……and that’s when the light bulb went off!
I mentioned in a previous post that I’m closing on property next week. It’s a 2/2 condo with a garage and it’s in the exact community as the one on my vision board. It’s looks exactly the same, color and all (there are 3 different color schemes in the community). Literally the only difference, its on the next street.
That freaked me out!
When I first starting looking a few months ago, this type of unit was not in my current day criteria. Somehow I ended up gravitating to this deal though and got more creative and negotiated more aggressively on this then I normally do – I guess now I know why
The numbers work and I’m getting everything I want in a living space.
I had totally forgotten about the picture of this condo. Well, at least that’s what I thought!
That’s the power of a vision board, really cool (and a little scary)”
You can learn more about Mitch on his to his website: www.scaredycatguide.com which is home to his “Scaredy Cat Investment Calculator” which many of our investors use to evaluate their deals to make sure the numbers work.
My first experience with a vision board was just a screenshot of google maps sky view of block I wanted to own one day that I kept over my desk. 5 years later I owned 6 of those houses, was living in another 1 and had sold 3 others in the same block to my clients. It’s pretty crazy what the power of intention can create. When I tell this story I always laugh and say, “I should have set my sights higher and zoomed out on that screenshot.”
I like to use Pinterest to gather the images I want for a new vision board and later print those images to put in prominent places throughout my house and office spaces. I currently have 14 white boards in my house and many of them act as growing and changing vision boards.
Keys to Clarity
The number one reason most people don’t have what they want, is because they don’t know what they want! Clarity of purpose and vision is the key component to gaining everything you desire in your life and business. If you are looking for more CLARITY towards your goals, whether they be real estate related, business, personal or health. You have to accept that every goal has an effect on each part of your life. The steps to Clarity in your real estate business are:
1. Know your WHY
2. Decide Your Location
3. Choose 1 Strategy
4. Your Strategy and Location will decide your Property Type
5. Build a List of people who currently own the types of properties you desire
6. Meet those People and exchange Money for the desired property
Gaining clarity through guided meditation is one of the most effective ways I have found to start myself moving in the right direction of my goals.
I have traveled the country and studied under a series of spiritual guides and coaches. Tying these experiences with my understanding of Hypnosis and Nuero-Linguistic Programing I have created a 15 minute session that can be found in the university section of GualterAmarelo.com During this guided meditation the things that are most important to you will become more clear as well as the path to attaining them.
The power of clarity means that you will be able to let go of things that no longer support your goals and begin to attract the things that are truly important to you.
I look forward to going on this journey together and to helping you find the abundance that is already yours. Nameste
Guided Meditation For Clarity
Before we start this exercise please make sure that if you are not reading this out loud to anyone who is driving or doing something that needs their attention. I trust you are in a quiet place either alone or where you can focus all of your energy on this powerful exercise.
Again, this is important. Make sure that you are in a quiet place where you can focus and will not be interrupted.
Focusing on your breathing now, take a deep breath in All the way in Hold it at the top and then release it all the way out. Very good. Focus on the sound of your breath. Focus on feeling completely calm completely comfortable.
Now that you are in a more calm and pleasant state, lets just imagine that you are in a room with 3 doors. Each door represents one of the main sectors of your life. These are Health, Wealth and Relationships.
As you walk towards the door of your ideal health and walk in, you see your perfect body just the way you’ve always dreamed. The way it was when you were used at your perfect fitness or the shape you desire to be at. Feeling great just thinking about how awesome your body is with high energy and how flexible your joints are.
You see a mirror and the mirror shows your body in his perfect form exactly the way it was always meant to be. The perfect shape, perfect health, you flex your legs and notice you can jump higher than you’ve ever jumped. Now notice you’re flexible beyond what you’ve ever been. You feel absolute energy and you know you’ve consumed the right foods, you slept the right amount and you’ve exercised correctly so this is the body you deserve 100% healthy.
Take a moment to write down how your body, looks, how it feels, and the positive things people say about your perfect health.
Now lets imagine the next door is relationships. You’ve got a great body now so it’s time to go and put that to work smiling shaking hands high fiving people giving those hugs to the people you care about most.
Think about your favorite people or your favorite person, even if they are not in your life yet. You can envision those relationships. Notice the things are said as well, the feelings that are shared as well as the memories created together. In this room you are surrounded with the most supportive and thoughtful people who are always happy to see you. You know that just by existing and being yourself their lives are better because you are here.
Take a moment to write down how your relationships look, how it feels when you are with the people you enjoy, and the positive things they say when you are together.
As you open the door to your money room inside of course is all the money, the cars, vacations, homes and of course the people you love are there with you. They are proud to know you because the only way you choose to attract money is to add value people’s lives and you’re adding value to the people you care about the most. The only way to really enjoy money is to be in great health so you can go on adventures and experience things with people you care about.
As you continue to move through your money room you look at your bank account and you notice there’s money constantly coming into your accounts and the numbers keep rising as deposits are made from your rental properties and businesses. The thought crosses your mind, “of course my accounts are growing, I’ve had so much value to so many peoples lives and their lives are improved substantially”.
Now you are looking at your retirement accounts and notice that your is substantial because you invest in strong companies that are improving the world. There is so much money flowing in each month in the form of dividends and profits from your investments.
You open another page on your computer and you notice your real estate is being managed well and all of your tenants are paying on time. For a moment you remember that you have always made sure that your buildings are in good clean and safe working condition so you residents are thankful for the home your company provides them. You portfolio is managed of course by someone else who cares very deeply about the mission of your company to provide quality housing to quality tenants.
Take a moment to write down the material possessions you have, the amount in your bank accounts, stock portfolio, rental properties and the passive income coming in every day, week, month, year from your many investments. Write down how it feels when you are with the people you enjoy, and the confidence you have knowing that you are a person of significant wealth.
After this exercise, take a moment. Feeling completely abundant, full of gratitude and completely happy. I want you to visualize those three main pieces that you pulled out from each room: your health, your relationships and your money. Think of the most important one from each category and focus on it for a second. This is yours. You brought it into your life because you deserve it and you desire it. Focus on it very clearly and if you want to write something down feel free to grab some paper and leave yourself a note. You may want to take two to three minutes to write something down or text somebody who you care about and tell them you are thankful for them.
I have become known for doing this exercise live at events and over the years it has become one of the many reasons investors keep coming back to our events. It provides a way for you to get more clarity on your goals as your life changes and you progress on your journey.
This guided meditation is designed as a way to walk through your mind to identify what is truly important to you, without distractions. It is so import to take a step back in life for a moment and say OK this is important. What if I took all the other things away and I just looked at these particular sections of my life. Asking yourself, “what do I really want”, because clarity equals power.
I hope you were able to gain some clarity from this exercise and are ready to continue moving forward through this book with a clear mind and are at least open to the idea of a better life that is possible for you to create. Let’s set some goals!
We’re chasing all these distractions every day that everybody thinks are important and we believe that they are important to us, except in moments of true clarity you realize, “oh wow, I can’t believe I’ve been missing this in my life”.
Five Goal-Setting Tips For Real Estate Investing Success
As a real estate investor, it’s easy to succumb to the “shiny object syndrome”. By focusing on the latest and greatest deal, without seeing how this shiny object fits into your long-term goals. Because much of my early exposure to goals came from my experience in the corporate world I strongly suggest that real estate investors use the “SMART” goal system to plan out your fast-track to retirement.
In the SMART system, goals must be specific, measurable, attainable, reasonable and timed. Using the SMART technique can help you narrow your focus and get the most out of your real estate investments.
Goals Must Be Specific
The term real estate investing covers a wide range of investing styles (fix and flip, wholesale, turn-key investing) and real estate types (single-family, multi-family, commercial). Creating specific goals can help an investor stay on course among the many options available. Here are some specific ways to go about real estate goal-setting:
Non-specific goal: “I want to make money investing in real estate.” This goal provides no direction about how or where money will be made.
Specific goal: “I want to purchase 1 rental property for the next 5 years that will generate enough cash flow to replace my current annual income.” This goal is specific, and it provides a timeline of when it will be achieved.
Goals Must Be Measurable
It goes without saying that everyone wants to make money on an investment. Investors don’t invest to lose money. A measurable goal is something that can be quantified, like a specific number of properties that will be purchased or the return on investment that an investor expects.
Unmeasurable goal: “I want to be the top real estate investor in my area.” This goal is unmeasurable because it doesn’t really mean anything. A top investor could be the one who closes the most deals or the one who has the most monthly income.
Measurable goal: “I want to purchase 5 investment properties with a 8% or higher annual rate of return on investment.” While this may seem so simple, that is the beauty of a measurable goal. When an investor sets their goals, they can easily check to see if they are on track or not. Setting a goal that can’t be measured does more harm than good.
Goals Must Be Attainable
Ambition is every real estate investor’s friend. It’s the trait that drives an entrepreneur to be successful. That being said, real estate investors need to remember to keep their goals within reach.
Unattainable goal: “I want to make $100,000 on my first real estate deal.” While it is possible to make $100,000 on a real estate transaction, it’s not always attainable depending on your money blueprint, connections and especially for a first-time investor. Factors like market demand or properties available can impact this goal. Focusing simply on “the big number” should not be the only part of real estate goal-setting.
Attainable goal: “I want to secure a property with positive cash flow of $100 per unit, per month with potential for 10% value-add appreciation or equity on purchase.” This is an attainable goal because an investor can control where they buy and the price they pay.
Goals Must Be Realistic
Goals can hurt an investor when they aren’t realistic. Unrealistic goals are a lot like unattainable goals. However, an unrealistic goal goes beyond “out of reach” and into “impossible” territory.
Unrealistic goal: “I want to manage all my rental properties and fix-and-flips to cut down on costs, all while working a full-time day job.” No matter how motivated a real estate investor is, they can’t add more hours to the day. This goal of attempting to build a real estate investing business with no outside support just isn’t realistic.
Realistic goal: “I want to maximize my profits through partnering with the best team of real estate agents, lenders, attorneys, property managers and contractors.” It is still possible to achieve positive cash flow while working with a team of professionals. If the numbers add up, an investor can still realize positive cash flow while outsourcing the day-to-day work to the right team.
When taking part in real estate goal-setting, a reasonable investor must take inventory of their resources and set goals that correspond to the time and money you have on hand while stretching to what you know you can increase to within your current network of resources.
Goals Must Be Timed
Many real estate investors work for themselves, so setting a time for accomplishing your goals is critical. By setting timed check-ins, you can ensure you are meeting your goals.
Untimed goal: “I want to call as many leads as possible.” This goal isn’t timed because there is no end date. Ask yourself these questions: Is this a daily goal, a weekly goal, a lifetime goal? In addition to not being timed, this goal is also unmeasurable.
Timed goal: “By the end of the month I want to call 200 leads.” This goal gets points for being both timed and measurable. Setting a monthly quota for leads is an excellent way to parcel out all the work that goes along with investing in real estate.
Timed goals are especially important for when you are working with teams. They add structure to the dynamic world of real estate investing. You have jumped into real estate investing with the long-term goal of financial stability and independence. Timed goals offer a roadmap to achieve this worthy goal.
Taking the time for real estate goal-setting can feel tedious, but it is crucial to being successful. The process of goal-setting is only the first step for a real estate investor to begin making headway. Once goals are set, you need to develop a strategy to accomplish your goals. You will build on from here with the next steps in creating a strategy to keep your investment goals on track. The Fast-Track to your Retirement!
Continue on to the next chapter and make sure to leave a comment!