Investing: The First Step Is The Steepest

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When starting out on your investment journey, one of the critical stages involves setting the foundations. In fact one of the most common questions I receive from clients is . . . OK, you've convinced me that property investing is the way to build serious wealth. So where do I start?

Step 1 is (unfortunately) the most commonly ignored phase in the property investment process. What is Step 1 you ask - it's establishing a plan.

If you don't know where you're going then any road will get you there (as they say)! The moral to this story is that you must set goals and have an investment plan, unlike me when I first started . . . investing based on 'spur of the moment' decisions. It cost me many thousands of dollars BUT more importantly it taught me some very expensive lessons, lessons I have never forgotten. This is a good example of failing to plan.

The 'silver lining' on this cloud was that I was able to use the capital losses to offset future capital gains thereby reducing my future tax liability, although there are much more effective ways to legitimately minimise tax.

Imagine meeting up with yourself in 15, 20 or 25 years. How would you like to see yourself? How would you like relatives, friends and business colleagues to see you? This process requires that you think about and start with your destination in mind and seriously consider how you would like to be remembered.

Once you are able to clearly visualise that, you are much more likely to be able to describe how you would like to live. Answers to these questions should be reflected in your values and your values must be written.

This process should include:

- Establishing your goal(s) - be specific: you've likely heard about S.M.A.R.T. goals (ie they should be Specific; Measurable; Achievable; Realistic and Time Bound) - Preparing a budget

- personal cash flow and balance sheet: you'll be amazed at just how much money you waste. In fact many of my clients find that the money they can save, allows them to purchase either their first OR another investment property

- Designing an action plan. Include all specific actions required to achieve your goal(s): yes, this is a painstaking task BUT one that's well worthwhile. What you are doing here is breaking down your goal(s) into 'bight-sized' chunks

- Persist - most folks give up . . . don't be one of them: many folks give up just because they are faced with a challenge - that's the reason approximately 95 percent of people end up dead or dead broke

- Find a mentor - someone who has already done what you want to do . . . this will fast track your success. As I always say: you will pay for your education one way or another, either learning through very costly mistakes OR paying for your knowledge!

My philosophy is always to find someone who has the knowledge and experience and pay them to teach me. It's much quicker and far less expensive. In fact it's an investment in yourself and that's extremely important.

About the Author:
Garry Macdonald is a Real Estate Buyers Agent and helps his clients build multi-million dollar property investment portfolios in a low risk environment that enable them to retire in less than 7 to 10 years. Want to learn more?
Claim Garry's popular Free Report The 7 Most Costly Mistakes Property Investors Make & How To Avoid Them guaranteed to explode your net worth, available at: =>
http://www.yourrealestatebuyersagent.com



Article Originally Published On: http://www.articlesnatch.com


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