How to Build a Strong and Better Investment Mindset; The 20/80 Rule

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Building a Strong and Better Investment Mindset

I am coaching and consulting a Millennial to purchase his first investment in real estate property; his name is Alex.

If you have been listening to my podcast show, you may have listened to an episode titled; On the Move with Alex.

If you are a millennial or interested in purchasing your first investment in real estate, listen to this podcast episode.

On the Move with Alex; The Journey to Investment Real Estate

Coaching and consulting folks to purchase their first investment real estate property are very satisfying when “Mission Accomplished.”  

I have coached several couples to purchase an investment property, and when they receive their first rent cheque, the celebration begins.

Working with Alex; set the stage to realize I had As Alex and I work through getting him closer to purchasing and renting his first investment real estate property, a duplicable strategy to share with others.

I asked Alex to explain what he found as an essential element of the process and system we were using to get him started.

Alex said, “Rick, that’s easy; it is how you have helped me with my mindset.”

Alex went on to say; mindset is the first thing anyone wants to get started in purchasing and renting their first investment property needs.

What is mindset? According to Wikipedia, Mindset is:

In decision theory and general systems theory, a mindset is a set of assumptions, methods, or notations held by one or more people or groups. A mindset can also be seen as an incident of a person’s worldview or philosophy of life.

What is your mindset?  Do you have the mindset to be a first-time investment real estate investor?

Review your mindset and how this impacts you as a first-time real estate investor.
As this person overlooks the skyline of real estate, you must realize this skyline does not get built unless someone purchases the land, makes the properties, and finds tenants to occupy the buildings. It Can Be Done.
A small percentage of folks in North America own investment real estate as part of their financial portfolio; between 4% and 8% of North Americans own real estate.
The Pareto principle states that, for many events, roughly 80% of the effects come from 20% of the causes.
In my world of investment real estate I refer to the Harris Principle which states 20% of your funds effects 80% of the return on real estate investment.  This principle requires you to change your mindset regarding investment real estate.
Let’s ask you the following question.
Why Are You Risking All of Your Money?
When it comes to investing, most people put up 100% of the investment to earn a return on their money.   Old Age Security, Mutual Funds, Stocks, Bonds, and many other assets; the government or wealth management companies want you to fund 100% of the investment and then promise you some return.
During the financial crisis of 2008, most folks lost a ton of value in their investments.   The performance of people’s investments was slow to recover, but we have seen a long and healthy bull market; unfortunately, over the last several days, we saw much of the gains for 2018 disappear.
The markets are not for the faith of heart. The lack of control and volatility in the markets creates the bigger question is there a better way?
How do I get you to shift your mindset when it comes to investing and stop the madness of putting your entire financial future; 100% in the hands of others?
The answer is simple: I need to introduce you to an old friend, one with whom most of us have had a relationship all of our adult lives. Who?
The Banks; They are Your Friends
Using a conventional mortgage in North America requires you to put up 20% of the purchase price of the investment property, and the lending institution will provide you with the 80% remaining balance.
You heard me correctly; you put up 20% of the investment funds and the lending institution puts up the balance. The incredible thing about this is that when you pay off the 80%, you own the property, and the financial lending institution does not have an equity stake in your property. So if you purchase a property for $100,000, invest $20,000 as your investment stake, and borrowed $80,000, and over the 25 or 30-year amortization, you paid off the mortgage; the entire house value is yours.
The Tenant’s Gift
Use this process to purchase your first investment real estate property and rent this property; the tenant over the 25 to 30 years of you owning the property makes your mortgage payment and pays off your entire mortgage; sweet! 

Are You Ready to Build a Strong and Better Investment Mindset?

Ask Yourself the Following 4 Foundational Questions:

  1. Where is Your Investment Mindset Now?
  2. Are You Ready to Take on the Mindset of a First Time Investment Real Estate Investor?
  3. Can you now see a different method of building your financial foundation using the 20/80 investment real estate rule?
  4. What does your investment life’s skyline look like?

 

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About the author, W. Rick

Dynamic entrepreneur and sales management strategist; with over 20 years of experience in his field. Rick has achieved multimillion-dollar sales growth while providing award-winning sales leadership and coaching in highly competitive markets.

An active real estate investor since 2002, Rick has developed his purchasing strategies and processes specializing in vacation and recreational properties, single-family homes and condo rentals.

In 2005, Rick re-financed his first rental property to fund the purchase of more positive cash flowing rental properties.

Rick sits on the Board of Directors for several condominium associations and is an active President and Treasurer. Sitting on these boards has given him a wealth of experience and insight into working with property management companies.

Rick has partnered with several joint venture associates and is committed to creating a positive investing experience for his associates by finding the properties, developing the investment, securing the financing and executing a proven positive cash flow system.

Why should you choose Rick as your Online Vault to Investment Real Estate Success Advisor?

An outstanding mentor and coach, Rick will work with you to build your investment real estate business starting from the foundation. From guiding you through the market research and critical drivers, building your team of trades, realtors, and lenders to attracting the investment real estate properties right for your portfolio and the joint venture partners to help you grow.

Through direction and training, Rick will help you develop your investment real estate goals and be a catalyst for you to purchase your first investment real estate property so you can build a strong financial foundation unlocking sustainable wealth and a living legacy for you and many generations to come.

Thank you for taking the only asset that gives us so much through life, but we can never get back our time.

Please join Rick on living his mantra:

” Prosperity for all aspects of your life forever.” W. Rick Harris

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