The Key to Successful Investing? Your Mindset
This post may contain links from our sponsors. We provide you with accurate, reliable information. Learn more about how we make money and select our advertising partners.
Every few years, hundreds of athletes gather for the greatest show of human ability on Earth: the Olympics.
And every time, athletes set new world records. It seems impossible that after all these years people would still be setting records. You’d think that at some point, the human body would just max out. But in 2016, 27 new world records (and 91 Olympic records) were set, from pole vaulting to sprinting to the shot put.
How does this happen? How do the athletes not only muster the determination to reach the Olympics, but then set an all-time world record?
Yes, it comes from advanced training methods, but mainly it comes from the shifting of mindset.
New goals are set and what's possible expands. Actions are then taken to meet and surpass goals.
The world of real estate investing is no different. We may not be competing in sports, but if you want to succeed in reaching your financial goals, your mindset is no less important.
Investing can be tricky waters to navigate, but with the right mindset, you’ll be able to achieve your goals and make the life you’ve always wanted–for both yourself and the people you love.
Get Over the Fear of Failure
There’s a common saying you’ve probably heard many times:
Failure is not an option.
It’s an admirable idea, but when it comes to personal growth, we know how important “failure” is. After all, we learn most from our mistakes (I know I’ve made my share).
For many of us, though, the idea of making a mistake–of failing–and losing money is enough to keep us stuck.
I definitely understand this fear. It took me a while to get over that fear and make my first investment. But even now, I consider the time I spent waiting, planning for every possible contingency, essentially in paralysis by analysis, as time wasted. I’ve made mistakes that have cost a bit of money, sure, but I still think my biggest mistake was waiting so long to get started.
It’s important to realize that even if you take a step into the unknown and make a mistake, that’s still a step forward. It’s far better to be moving toward your goals than to be stuck, like I was.
So while failure may not be an option, mistakes will happen. That’s okay. Don’t let the fear of failure keep you from your goals–and reaching your ideal life.
Be Specific About Your Desired Outcome
What is your ideal life? Take a moment to envision it. Are you retired, sitting on a beach in a tropical paradise? Are you with your family, free to travel when and where you want without being concerned for money?
Maybe you’re still working, but on your terms, not relying on your job’s income for your living.
Whatever your ideal life is, it’s crucial to have a concrete image of it in your mind. Write it down if you can.
This is the life you can have, and it may come sooner than you think.
If you’ve read this far, then you’ve likely realized how effective real estate investing can be in helping you reach financial freedom. We’ll talk more about that, but for now, it’s important to know why you want financial freedom.
I’ve talked about this before, but it bears repeating.
It’s easy to think, “well, I’ll just get started and see where it takes me.” While even getting started is a major accomplishment, this approach will either take a very, very long time, or worse: fizzle out.
If you take some time to set concrete, actionable goals, you’ll find that not only will you accomplish those goals faster, you’ll have a developed roadmap that will guide you along the way.
How do you set actionable goals? Make sure they’re S.M.A.R.T. While I go into these more in depth here, the idea is easily summed up with this acronym:
S – Specific
M – Measurable
A – Achievable
R – Realistic
T – Time-Bound
Actually I've had my own shift when it comes to teaching the SMART method of making goals. I now challenge people to take “REALISTIC” goals and dramatically upsize them. I'll talk about what that looks like in a future post, but don't limit yourself by selling small goals.
Not only is it important that the goal is clear, you also need to know when you’ve reached it, that you can actually accomplish it, and it needs to have a deadline.
If you set your goals along this format, you’ll have everything you need to make it happen. This leads right into my next step.
It may seem obvious, but in reality, many would-be investors never get past this step. All the goal-setting and learning in the world won’t do you any good if you never take action.
On one hand, I completely understand how intimidating it can be to make that first investment; there’s always a certain level of risk involved.
But while no one wants to lose money, not taking that first step leads to a much greater cost.
The Cost of Inaction
One of the single greatest motivators for me is simply thinking about where my life will be if I don’t take action. If I never made that first $5,000 investment, for example, I often consider where my life would be now.
Would I have ever achieved financial freedom? More likely, I’d still be stuck in the valley of indecision, trading time for money and hoping for a different outcome.
The truth is, every decision you make is a step taken either forward or backward. When it comes to reaching your ideal life, there is no middle ground. If you don’t step forward to your goals, then you’re not standing still. You’re stepping backward.
Think about some of the decisions you've made that have drastically changed your life for the better. Maybe you decided to apply to a certain school, residency, or job that you didn't think you could get into it.
Maybe you decided to make an investment or learn about something that was normally uncomfortable for you but it set you on a different path.
Now think about what your life would be like if you did nothing instead.
This is the true cost of inaction.
The good news is that right now, you can decide to move forward. It doesn’t have to be a major step. Even reading a book on investing is a step forward. The key is that once you reach the next step, always take action.
How Will You Get There?
By now, hopefully you’ve taken some time to set and visualize your goals, and you’re ready to go. The question is . . . now what?
The next steps you take are important ones, because they’ll shape the path you take for the next few years.
I wrote an article on just this subject, but in summary, it’s vitally important to educate yourself. Learn what your options are and what interests you. Once you’ve found a deal or a platform, perform the due diligence. Then, all you have to do is make the investment.
The key is that in order to go through all of these steps with less stress and to ultimately achieve your goals sooner, you have to get your mindset right.
If you’d like to share your journey with like-minded people and get actionable step-by-step learning, be sure to check out our upcoming course: Passive Real Estate Academy. We’ll be covering the next steps in great detail, and you’ll gain all the tools you need to invest confidently.
Enrollment opens again next month, so don’t wait! Join the waitlist here.
Disclaimer: The topic presented in this article is provided as general information and for educational purposes. It is not a substitute for professional advice. Accordingly, before taking action, consult with your team of professionals.