Visions of Dollar $igns Dance in Their Head

As you know, many clients in 2011 decided to pull their money from stock market and low yielding retirement funds to buy rental properties that produce monthly income. When we first sit down for our initial consultation, the client is very happy with the thought of getting between $400 and $800/month on a $30,000 or $50,000 property.

They start calculating: $500/month on $30,000 = a 17% return! Paid for in 6 years! They are smiling from ear to ear with the thought of making this kind of return. The possibility of retiring with adequate income delights the investor. More calculations are made to determine how many properties they need to accumulate to be able to quit their day job altogether and be free to enjoy life.

Do you remember the cartoon character Wylie E Coyote? Picture Wylie with his eyes popping out of his head, the pupils replaced with Dollar $igns. That's the next phase most of these clients go through. At first, a 10% return is fantastic! So much better than the 3 or 4% return they've been getting! Then the greed sets in.

It's only human nature to want more, better, faster - that's what makes humans come up with inventions that help us advance as a civilization and make daily life easier.

Yes, we will find some properties that give you a 20% or better return but there will be fewer of them than the ones giving a 10% return. You may have to do more work to improve their condition. The location may not be as desirable. Do you remember your goal? Do you remember saying that anything at 12% or better is what you want?

Greed will cause you to turn down perfectly acceptable counter offers. Greed will cause you to lose out on good houses. Greed will cause you to frustrate yourself. Greed will cause indecision. You will lose time. Time that you could have been putting money in your pocket. Be wary of the greed that tries to take you over.

Sure, I'll hang in there with you as you go through this phase but I have to tell you that it's not a good look for you. Focus. Remember what you are doing this for. Your goal was to generate income so that you can work less, spend more time with loved ones, go wind surfing in Belize, climb mountains, visit Italy, take that art class, pay for college, or help your Grandma.

Your goal was not to become tight with greed but to gain freedom to enjoy life and to be able to help others. Take control of that greed monster and remember who you really are. Go for the gusto; enjoy your life!

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WISHING YOU ALL A HEALTHY, PROSPEROUS AND VIBRANT 2012!        ♫  ♪  ♪♫