How to Become a Millionaire and the Secret To Achieving Goals By John R. Burley One thing I do at the beginning of every year is sit down and review my progress for the last year, five years, and the last decade. It’s something I do to keep myself on track. Without beating myself up, I review the lessons I have learned. I look at all the things I have done right and the things that needed to be corrected. I do this so that I can focus on what I need to concentrate on for the upcoming year(s). I know there is always room for improvement. I just want to make sure that what I spend time improving is the most critical to what I want out of life. I’m probably like you in that I don’t want to get to the end of my life and regret that I haven’t tried some things that I wanted to try or that I haven’t achieved some goals that were certainly within my grasp to achieve. Again, I just want to make sure that I am staying on track with my vision for life. This inner motivation to achieve even transfers into my daily life. I have a big secret that allows me to make money NOW everyday. Let me share it with you. At the beginning of each day that I work, I ask myself one simple question: What is the one thing that I can do today that would make me the most money, NOW? It seems simple, even common sense, but you would be surprised by the number of people who spend the vast majority of their time set aside for investing on the little activities that make them no money at all. Asking and answering this question honestly puts me in the frame of mind to focus on the things that will push me forward on the path toward fulfilling my vision of the best life possible. After asking myself this simple question, I then do that one thing first, before anything else. It occurred to me several years ago that I could put this power to work on a big scale as well as helping me get the most out of my days. With that in mind, lets look at how this question along with a little goal setting can make you a million dollars (or more) over the next 5 years through active and deliberate real estate investing. The Power of Goal Setting And A Million Dollars in Five Years Walk through this little exercise with me. I think you will quickly see that setting some achievable and realistic goals can go along way toward helping you realize your real estate investing dreams. First, let’s make a 5 year financial goal of acquiring one million dollars that actively produces income. After that, let’s take a moment to break down that goal into what would need to be accomplished year by year in order to achieve it. But, don’t just break that goal down as $200,000 per year. Why? Because that is not realistic. The principle of lag dictates that in achieving this goal you would start at less per year and end up at more per year. The reason is simple. As you improve, learn, and continue to invest your ability
(and resources) in order to do more deals, then your capacity to make more profit will naturally improve. Let me show you what I mean. So your 5-year goal of One Million Dollars actively producing income would look more like this. 5-Year One Million Dollars Goal 2006 - $ 50,000 - Acquire 2 properties each with equity of $25,000 2007 - $100,000 - Acquire 4 properties each with equity of $25,000 2008 - $200,000 – Acquire 8 properties each with equity of $25,000 2009 - $400,000 – Acquire 16 properties each with equity of $25,000 2010 - $600,000 – Acquire 24 properties each with equity of $25,000 Total - $1,350,000 – 54 Properties Actively Producing Income That’s a doable goal, isn’t it? It’s something that you as an active investor could realistically pursue and achieve! And before you know it your net worth would be well over a million dollars. How exciting is that! But let me show you how to make achieving this goal even easier. Watch this! The Secret to Achieving Goals In order to achieve goals with any regularity, the secret is to base the goal on activity rather than the result. Here’s what I mean. If you had to submit 25 Written Offers to acquire one property then your primary goal for the first year would not be to buy 2 houses with equity of $25,000 each. Rather your goal would be to make 50 Written Offers, knowing that the Principle of Lag will bring you the result. By focusing on the activity I find it much easier to deal with rejected written offers. Here is what I do. I do the numbers. I think of my goal (task, objective) in this way: 50 written offers = $50,000, thus each written offer is worth $1,000. That’s right, think of each written offer as being worth $1,000, whether they accept it or reject it. By focusing on the fact that each written offer takes you one step closer to an accepted offer it will be much easier to keep going. I’m not kidding. This really works. I have been doing this since my early teens. First with golf (., if I hit 300 balls, played 18 holes, and didn’t go to bed until I made 50 4-foot putts in a row my ability would improve until the point where I
could win), then with sales at age 17 (50 door-to-door cold calls, led to 4 demonstrations, 2 would be mini-demos to unqualified buyers, 2 would be full demos to qualified buyers, 1 would buy). Thus by learning to focus on the activity required I was able to first become a scratch golfer (who won tournaments) and then later a top producing sales person. All I had to do was focus on the numbers (activity) and the money would come (Lag). Focus On The Activity! I have done this with fantastic results for years, and it works. Focus on the little activity that takes you towards your goal. So, with that new perspective, let’s now look at your 5 – Year Goal of having One Million Dollars Actively Producing Income: 2006 – 50 Written Offers 2007 – 100 Written Offers 2008 – 200 Written Offers 2009 – 400 Written Offers 2010 – 600 Written Offers Total – 1,350 Written Offers - $1,350,000 –54 Properties Actively Producing Income Remember to focus on the activity. Figure out what you have to do (the most important things) to get where you want to go. Then get started. Don’t try to make 100 real estate deals your first year out. Make one, then another, then another. Many of the most successful real estate investors I know started out with just a few deals per year in their early years. Then the Principal of Lag kicked in and their fortunes were made. So get started. Write down your goals NOW. Figure out the activity required. Focus on the most important thing each day. Then I’ll see you at the beach, the golf course, or my favorite fishing hole! Go get ‘em! Good Investing, John Burley
Ask John The investment home I just purchased as a Cash Flow property needs a lot of fix-up. How much fix-up do I need to do in order to remarket this property? I get this question all of the time. New investors purchase homes that need new carpet, paint, tile, or wallpaper, and then they stress out about repairs and usually end up sinking way too much money into their investment properties. There are a few rules that I typically follow when determining how much repair work I need to do to an investment property before I remarket it. Let me share those rules with you quickly. Rule #1 – Remember that this property is not going to be your primary residence. Many investors go crazy with the repairs when they begin to view the investment property through the eyes of an occupant and not an investor. When an investor approaches a property with an eye to doing repairs that would make the house comfortable for them to occupy, they usually end up spending too much money on repairs. Remember, an investment property is simply that – an investment property, which is simply a tool to make money. An investment property is not going to be YOUR primary residence. Rule #2 – Remember that every dollar you spend in repairs is a dollar from your own pocket. As a general rule, repair dollars seldom increase the value of a property for as much as they cost. For example, a typical swimming pool in the city in which I live costs the consumer $35, to install but only typically increases the value of the property by $17,. With this in mind, before you sink a bunch of money into repairs, be aware that every dollar you spend is a dollar out of your pocket. Rule #3 – Remember to see repair needs as remarketing opportunities. When it comes to investment properties, I like to brag about my weaknesses. This actually helps me remarket the property. For instance, if a house needs a new roof, I will remarket it as a “Roofer’s Special”, drop the price a little (not as much as the cost of a new roof) and put it out there on the market. Inevitably a
professional roofer will by the house from me and do the repairs himself. I do the same with properties that need new carpet. I call them “Carpet Layer’s Specials”. The same principle applies. Someone who works for a carpet company and can get their hands on remnants will usually pick up the property from me. Repair needs are really remarketing opportunities. See them as such. When making repairs on your investment properties, there are some things that must be done. Your state will have “landlord/tenant” types of laws that dictate required repairs. So make these repairs and be done with it. I talk to so many successful investors who regret having spent so much money in repairs when they started out. Follow these simple rules and any necessary repairs shouldn’t be much of a burden at all!
