Expert Advice with Michael Yardney. 28/09/2017
I'm often asked what I would do differently if I could live my investing journey all over again.
I've certainly made my fair share of mistakes along the way and paid huge "learning fees" because of them. However, instead of being defeated, I learned from each error and moved forward a little bit wiser.
If you ask me that’s one of the keys to investment success - the ability to pick yourself up from setbacks, learn what you can from them (including your own limitations) and simply try again.
So, to help prevent you from making the same mistakes, I've put together 16 things that I wish I'd known when I first started investing.
1. The value of education
At the start of my investing career, I believed that I knew enough to be successful, but that wasn't the case as, of course, I didn’t know what I didn’t know.
My first couple of investments were successful, but the worst thing that can happen to a beginning investor is to get it right the first time – you think you’re smarter than you are, when in truth my early successes were because of a rising market rather than my own "brilliance".
Thankfully, I recognised this and set about becoming better educated by reading books and seeking out teachers, mentors and consultants for advice.
And I still continue with my education and personal development to this very day.
2. Goal setting
Far too many people invest in property with no idea what they want to achieve or by when. They may buy one or two investment properties, usually in suburbs where they live or "understand", but they haven't set any clear long term goals.
When I say it like that, it doesn't make any sense, does it? Obviously you must begin with the end in mind.
Setting goals helps you focus because if you don't know where you're going, while any road may get you there, every road may also get you lost.
As Jim Rohn said: “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.”
3. Create a property team
Because everyone has lived in a property of some sort, most people think they know a bit about property.
While property investing may be simple, it's not easy and that's not a play on words – it takes skill. And sometimes those skills should come from other people who know more than you do. So, create a good team around you including mentors and advisors or your "brains trust" as I like to call it.
However, if you're the smartest person in your team, you're probably in trouble.
4. Think rich, not poor
You probably believe that you deserve to be rich and successful.The problem is your income will seldom exceed your personal development. That's why it's important to develop the mindset of rich people and the rich habits of successful property investors.
Here's another great quote from Jim Rohn: “Don’t wish it were easier, wish you were better. Don’t wish for less problems, wish for more skills.”
5. Have an abundance mindset
To become successful you’ll also need an abundance mindset.
What do I mean by that? An analogy is to think of yourself as a cup. If your cup is small you can only accumulate a small amount of money, any extra will spill over and you will lose it. You simply cannot have more money than the size of your cup.
Instead, develop an abundance mindset in which your cup is big and deserving of being filled with success.
6. Delaying gratification
You know that new pair of shoes, latest smartphone or perhaps that fancy car that you dream about? Do you really have enough money to buy them... with cash?
Far too many people can't resist the instant gratification of buying that shiny new toy using their credit card thinking the money in their limit is theirs. It’s not – it’s the banks money you pay interest on for the privilege of using.
To become rich you must learn to delay gratification as wealth is the transfer of money from the impatient to the patient.
7. Overcome your fears
The truth of the matter is that fear is a powerful human emotion. While it can help us, it can also prevent us from investing because we illogically see it as too "risky". However, with a sound investment strategy, and a property team around you, you can minimise the risks.
One of the keys, therefore, is to overcome your fears and learn to be comfortable with being a little uncomfortable in the beginning.
8. Don't let failure hold you back
We all make mistakes. The difference between ultra successful people and the average Australian is that successful people don't let failure hold them back. Instead they get up and try again.
Most people worry about things that will never happen and all this does does is prevent them from achieving success. Instead save your worrying for when there's something to worry about.
As you can see, there are a number of things that I have learned along the way that have helped me become a more successful investor. So here's my recommendation..
Consider implementing some of these strategies into your life today and I guarantee that success will be closer than it was yesterday.
I’ll share another 8 ideas I wish I knew earlier next month.
Michael Yardney is a director of Metropole Property Strategists, which creates wealth for its clients through independent, unbiased property advice and advocacy. He is a best-selling author, one of Australia’s leading experts in wealth creation through property and writes the Property Update blog.
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Disclaimer: while due care is taken, the viewpoints expressed by contributors do not necessarily reflect the opinions of Your Investment Property.