Applying what we know about the world to what we are being told about investing.
The year 2020 has shown everybody how complex the world we live in really is. We understand that an infectious disease can spread around the globe regardless if a country and its people are very sophisticated or less sophisticated, consider themselves the richest on the globe or the poorest.
We have learned that some systems see their world and the people within its borders as a community that needs to be protected as a whole and addressed as a whole. For that economies shut down and can remain closed for 111 days (i.e. Australia), or the whole country closes itself down (i.e. New Zealand). Then, on the other hand, some react to the same situation and circumstances with the exact opposite approach. They either did not shut down at all (i.e. Sweden) or they shut down a little here and there but only very short periods of time (i.e. USA), even as evidence of the effects is turning negative and skyrockets.
Each place is looking for its own approach and applies its own norms.
I am mainly helping people who want to reach a point in life where they have the freedom to decide what they want to do with their time. You can ask people around the globe and when they had some time to reflect, they will all tell you that time is the most valuable thing we all have. The freedom to decide what you want to do with your time is what I call Economic Independence.
To get to that point sooner rather than later, it is our approach and strategy to help people become Investors.
When looking at the complexity we are more and more exposed to across the world, that goal of becoming an investor is harder the deeper you look.
Within your own country, let’s say America when you ask people their opinion about investing, most respond with opinions about the stock market and mutual funds and tax reducing retirement plans like the 401K plan.
The other part that is often quickly appearing is talk about risk, need for help, high cost, and an appearance of gambling. Investing in many people’s minds is an activity for those who can afford to lose money or are rich, anyway.
When it comes to real estate investing, that is, even more, the case because the numbers in our heads immediately increase. While we can comprehend the stock price of a company, typically between $50/share and $500/share, anything in real estate is in a totally different realm. Here, we are into the thousands or hundreds of thousands very quickly, and it feels unreachable for many.
That turns the investment world into a playground for the few 1% and we turn away, back to work.
I am working tirelessly to help people understand that it’s not that hard to get into real estate investing and ultimately use the income to reach economic independence.
When looking for places to invest the situation gets even more complex. In each country, there are expensive and less expensive locations and it’s difficult to determine where your best opportunities can be found. That’s why we suggest getting help.
What if you are looking from one country to another?/ I have a few folks who are deployed in all kinds of places around the globe and wonder if they could invest there or rather at home, even though they can’t be near their purchase.
Complexity again comes into play. Now you face the issue of different rules in taxation, ownership, legal help, contracts, gain declaration, depreciation, etc.
We tend to apply our own experiences to other places and then form our decisions. If it is hard to make real estate investments as a German person, the fact that it is much easier in America does not enter your mind.
If, on the other hand, it is very common that your family has always owned properties and handed them from generation to generation, like in Spain, where more than 70% of all real estate is held by private families, the idea of having to start a new portfolio is very foreign.
If you layer the rules that differ in each location, the complexity increases even further. That begs the questions:
Is it worth it?
I would say very loud and clear: Yes, absolutely.
Just knowing that there is a point in the not too distant future where you can basically do whatever you like and know that your regular bills will be covered by your passive income from the real estate should motivate everybody.
Andrew Henderson, the Nomad Capitalist, follows a philosophy that stated: “Live or go where you are treated best.”
To be able to do that, accepting the complexity we are increasingly faced with is worth it.
One thing that we can all take some solace from is the emergence of more and more systems that help us find information so we can make informed decisions. Now there are platforms like Zillow, Redfin, look for you, Rentometer, Bigger Pockets, and on and one. each has a certain puzzle piece of the investing in the real estate world covered. I love these tools and they help me focus on explaining what they are good for and why we want to use them, rather than digging around for the data, as we used to in the past.
Complexity can be scary. In my experience, the best motivator is a goal that will really change your life. Set your income goal for the point when you reach economic independence. Then work towards that goes every day a little bit. And don’t forget — seek help. I, and many others, are here to make the journey easier.
The most important thing is for you to take the first step.
For an introduction on how to take that first step towards investing in Real Estate, Download your free mindset manual