Most people are content with waking up at 7:00 in the morning, slaving away at work, getting home at 7:00 at night, watching a few hours of TV, going to sleep, and doing the whole thing over again the next day. It’s pretty depressing when you think about it!
But there are others who want more out of life. They want to be free from the “chains” of traditional employment. Many of these folks are rugged individualists who want to do their own thing and be left alone. While a certain amount of this attitude is admirable, and may even be an asset in real estate investing, if taken to the extreme, it can be a detriment.
You don’t need to be a social butterfly to succeed in real estate, but if living alone in a mountaintop yurt is your idea of bliss, you should probably open an Ameritrade account instead of delving into the world of property flipping. Simply put, real estate investing is a team sport.
Putting Together a Winning Team
You shouldn’t wait until you’re ready to make your first deal before you begin to look for the right players. First, you need a real estate attorney. Secondly, a tax advisor and a mortgage broker. Rounding out the team should be a title or escrow company, a contractor or handyman, and ideally, a partner or mentor.
Of all of these team members, a good attorney is perhaps the hardest to find. This is because most lawyers are skeptical of creative real estate transactions and don’t engage in real estate investing themselves. Before committing to an attorney, ask some of the following questions: Do you own any rental property? How many closings do you do in an average year? Can you tell me about some unusual transactions you’ve dealt with recently? How about foreclosures? Double closings? Land contracts? If you don’t like the answers you hear, by no means should you count on the attorney just because he has the letters “Esq.” after his name. Keep looking, or better yet, ask other investors for recommendations.
The same can be said for your tax advisor. These days, a monkey can prepare taxes – or at least a monkey with TurboTax software can – but good accountants are hard to find. A good accountant does more than crunch numbers – he or she uses aggressive planning strategies to avoid as much taxation as possible. Most of all, a good accountant knows the difference between tax avoidance and tax evasion. The difference? Up to 25 years in prison. While it’s important to be aggressive, it’s even more important that your avoidance strategies don’t stray into evasion territory, and a good CPA can make sure you stay on the right path.
While finding a quality attorney and tax advisor is vital, and the importance of the other members of your team is not to be discounted, the most important member of your team, if you’re lucky enough to find one, will be your mentor. While it would be nice to find a kind, grandfatherly veteran of the real estate world to take you under his wing, the more likely scenario is that you will need to earn your keep as an apprentice. Offer to work, unpaid, for the right mentor if you can find one. In doing so, you will be making an investment in yourself that will greatly outweigh the value of your formal education – and you won’t have a whole mess of student loans when you’re done, either!
Think and Grow Rich – Your Master Mind Group
I like to think of myself as a distinguished author and I wholeheartedly believe in the value of my books and articles. However, if you haven’t read Napoleon Hill’s Think and Grow Rich, stop reading this now, go to the bookstore and pick it up! It is an invaluable resource for anyone interested in wealth building.
In Hill’s classic book, he recommends that people interested in becoming rich form “Master Mind Groups,” in which the members meet weekly for breakfast to keep one another on task and to share ideas. This type of group accountability works wonders on the human mind.
Furthermore, you should definitely join your local real estate investment association. This is a great place to recruit members for your Master Mind Group, get recommendations for your team, and possibly find a mentor.
The most important thing is to surround yourself with like-minded people. Friends, family members, and even real estate professionals will do their best to make you feel like you’re on the wrong path. Truthfully, they’re threatened by your impending success. Napoleon Hill recognized this nearly 70 years ago when he wrote his classic book. Since then, thousands of people have made millions of dollars following his advice of team-building and positive thinking. Wouldn’t you like to count yourself among their ranks?