If you have never invested in property before – either your own residence or an investment property, it may seem overwhelming and out of your league. Combine the goal of owning property with the mentality of wanting the end result NOW, means you are likely to be overwhelmed.
In property with pretty much most things, you need to work your way towards the end goal, you can’t just take a giant leap and go from where you are today to the end result.
You may dream of owning 10 investment properties where you make $500 profit per week on each of them. Or you may dream of supplementing your retirement fund by earning $1000 per week from your investments. But they will remain a dream if you don’t take action.
So, how are you planning on getting there? When do you see this end result happening?
If you are like most of us, you want it now and you have no idea how to actually achieve it. Well, the secret is having a five year plan. Not a 10-year or 20-year plan.
Focusing on five years means you have to work hard towards the goal, but you can see the end. A 10-year or 20-year plan means you can’t see the finish line and the chances are you will become different person in that time, and your goals are likely to change.
So rather than aiming for ‘passive income of $250,000’ without a real deadline, think about the five-year mark. What would be a bit of a stretch for you but a goal that would really make a difference and keep you motivated in working towards that ultimate prize?
If you started today and looked five years down the track would you be satisfied earning a passive income of $50,000 per year? Or would $75,000 tick the box? Maybe something else entirely?
Once you have the right goal that would motivate you but not overly intimidate you, what do you do from here?
If you are new to investing you get some help – a property mentor who will work with you on devising the right plan on earning that $50,000.
You might find that they advise you to buy two small units and reduce your debt over the five years. At the end of that time you could sell the units or use the equity to buy more property to expand your empire.
You might purchase five small units, pay down your debt with every spare dollar you have, and then at the end of the five years sell off three of the units. This will hopefully pay off all the remaining debt, leaving you with passive income free and clear.
It may mean selling the home you own and purchasing investment properties. This option could mean that in five years the rental income that you earned, combined with the property equity, allows you to purchase your own property, while keeping your investments.
Everyone is different and has different goals, but the key is to not look too far in the future otherwise you will become overwhelmed. So commit to five years.
Work hard, keep focused and your investing dreams will come to fruition.