BUSINESS PLAN

Do you have a business plan in place? The reason for a business plan
became evident in a study done at an Ivy League university. They asked
their graduating class how many of them had written down their goals.
Only 5% of the class raised their hands. The other 95% of the class had not
written down their goals. (Keep in mind this is an Ivy League college.)
This was a well-known and very prestigious college, yet many of the
students had not written down their goals.
The university tracked these students over the next several years. When it
looked at their net worth later on, the 5% who wrote down their goals were
worth more than the other 95% combined. That’s the power of writing
down your plan. Get your plan made. I will not take the time in here to
cover all of the sections of a business plan. The information is readily
available on the Internet, so I will speak in generality.
Your plan may be to invest in rundown properties, fix them up, and sell
them (known as flipping and it is done all over the world). In planning for
flipping properties, remember to review your personal strengths and
weaknesses. Your strategy should be in harmony with your attitude and
risk tolerance. Capitalize on your strengths. You need to be completely
honest with yourself on your strengths and weaknesses; write them down
as part of your plan.
You need to have a system because real estate is quantifiable and it’s
systematic. Systematic means you can continuously repeat a process.
Having someone who can create systems was critical for me, and Trond
was perfect because he was good at creating systems, while it was one of
my weaknesses. I also knew Trond had some weaknesses that would offset
my strengths. We used that as one of the building blocks when we formed
our partnership. We set it up to ensure that both of us would accept the
risks. We know that we have our own core motivations.
By enrolling in the RES Academy, taking the classes, and reading this blog you
have proven that you want to do something about your situation; you want
to invest in your future. That’s exactly what you’ve done; you invested in
your future much like someone will spend $30,000, $40,000, or $50,000
to go to college; it’s the same thing. You expect a return on this investment
in your future.
Your personality is going to define the type of risks you are willing to
accept. You need to create a written plan, one which will help you follow
the right strategies. This will help you get rid of some of the unnecessary
risks and allow only calculated risks. You need to do this to be able to take
the risks that you can handle. These risks will enable you to invest in your
future and reap the profits and benefits. We are at a point that we
understand risk and, more importantly, understand how to mitigate it.