Many people are stuck in a loop when it comes to investing. They go around and around looking at different models and end up never making a decision to choose something.
The timid investor evaluates one model after another until they end up where they started! This circular pattern ends up draining the investor of any confidence!
“Where should I invest?” Becomes a liability when asked too often. Funds end up sitting in a low-interest account making next to nothing for fear of not making enough!
Think of Money Like a Parked Car in Your Drive.
If left too long, the tires go flat. That makes it difficult to go anywhere. Soon enough it starts to rust. Then the interior and rubber rots.
Un-invested funds are the same thing as a parked rusting car.
Inflation is devaluing your cash reserve. That which you have worked hard to acquire is quickly eroding over time.
Are your concerned about high fees eating into your returns? Are you so risk-intolerant that your cash getting moldy with no return from sitting in the bank?
Do you keep waiting for that perfect deal with an unbelievable rate of return? Just how much is all that waiting and sifting through deals costing you?
It may be helpful to review your needs and wants when it comes to investing.
This will help you determine your risk tolerance.
Consider this illustration and think about what is important to you.
Number these points in the order of importance that meets your current and future needs.
Return On Investment
What is safe and secure with a respectable/acceptable return on investment? Most people know that the best return comes with the most risk.
Time
What is your time frame for investing? Are you looking for long term placement, or something more immediate? How far out are you from retirement? Do you anticipate any other need for your funds?
Risk
The least risk usually offers no return. This is often the savings account at a bank which offers next to nothing for using your money!
The most risky can offer very high returns. Some people made a lot of money in the Stock Market. Others lost everything. Some are out just because they no longer trust it.
Many people have lost money in bad investments. There is no one model that can be called all good or all bad.
Effort
Some people like a hands-on approach to building wealth.
Many have looked to real estate and become landlords only to discover the 4 T’s—toilets, tenants, trash, and termites. Some try working as rehabbers but either can’t find good deals now that competition is fierce and the margins have gotten so thin. This has become more than a full-time job and the risk reward is just not there.
A few become hard money lenders where it is possible to make a 10% or more rate of return. It is a great rate of return, however, there is a lot of churn. This means getting a high return for 6 months, then when the loan is paid off, your funds just stagnate with no return until you find your next borrower. It can be a constant effort to find the next borrower who is reliable and a good risk. Without a steady stream of successful transactions, the return rate falls dramatically by the end of a year.
Other people prefer to leave the effort to someone else. They have an individual or firm do the investing for them. This usually comes with hefty fees.
Maybe it’s time to reset your thinking.
Many investors do not feel comfortable with the current real estate market. They are concerned about a market turn similar to 2007.
After all, how many times have people seen the stock market drop only to invest again. And in what, exactly?
There are real estate investment models that reap rich rewards with a minimal effort and little risk.
There are options!
-Jim Rohn
Above all, believe in yourself and believe that you will achieve your goal!
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Sources:
Lynda at Sonoran Sun | Private Equity Investments
Further Reading:
Knowledge is power and updated knowledge is the most powerful of all.
It takes discipline, but living within one’s means is key to accumulating wealth. Being financially responsible in the present is a good way to ensure a comfortable future.
These steps are good places to start a more conscious and directed route to achieving your financial freedom. Read, reflect and take what will work for you.
It takes discipline, but living within one’s means is key to accumulating wealth. Being financially responsible in the present is a good way to ensure a comfortable future.
These steps are good places to start a more conscious and directed route to achieving your financial freedom. Read, reflect and take what will work for you.
Bottom line is that there is no blanket strategy. Each person must evaluate their own circumstances, needs, and desires. Get the help you need to achieve financial freedom.
If you don't design your own life plan, chances are you'll fall into someone else's plan. And guess what they have planned for you? Not much.
-Jim Rohn
Above all, believe in yourself and believe that you will achieve your goal!
_________________________________________
Sources:
Lynda at Sonoran Sun | Private Equity Investments
Further Reading:
