Investing can be challenging. Even the most seasoned investor will tell you that the struggles and pitfalls of investing are as common among the big players who do dozens or hundreds of deals a year as they are among the regular folks who work on just a few deals each year. In this blog post, youll discover how to turn even the biggest investing challenges into profitable gain
And the best news is: It applies no matter where you invest or what kind of deals you do. Perhaps youre trying to put together a deal after months of searching for one that fit all the parameters only to have the deal fall through at the last moment. Or perhaps youve tried flipping a property and found the market had changed between the time you bought it and the time you sold it, so suddenly you couldnt sell it for as much as you wanted. Or perhaps youve rented a property only to find the tenant left the property in the middle of the night, and left it in a less-than-satisfactory condition.
So whats the secret? Its simple: Have more than one desired outcome (some people call these exit strategies although I prefer the term desired outcome).
Most investors go into their deal with a singular expectation: flippers expect to flip; landlords expect to rent. And if that desired outcome isnt achieved, a sense of failure and uncertainty clouds the deal and leaves the investor confused about what to do next.
But what if you had multiple desired outcomes, ranked in order of what you wanted to achieve and a good plan for each desired outcome?
- The likelihood of failure diminishes almost to zero
- The possibility of profit increases dramatically
- The sense of uncertainty disappears and gives way to focus and agility
Heres an example: lets say you want to buy a property and rent it. Your first desired outcome is a rental and keep all of the money for yourself. But perhaps you recognize that you might not have the ability to purchase the property with your own money so you create a second desired outcome of partnering with another investor and splitting the rental income between you. But you also recognize that things change so you create a third desired outcome as selling the property, just in the case the market shifts or a personal issue in your life requires you to divest your holdings.
There are three desired outcomes, ranked in order of preference, and decided long before you actually start investing. Now you can invest and see what happens. Work toward the first desired outcome until it achieved or it becomes evident that its impossible, then switch the second desired outcome. Work toward that one until it is achieved or it becomes evident that its impossible, then switch to the third desired outcome.
Multiple desired outcomes give you clarity of purpose but also the ability to easily switch tracks if necessary.