FEAR TO FREEDOM. Linda McKissack. Lessons Learned from 25+ Years in Real Estate Investing

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1 Lessons Learned from 25+ Years in Real Estate Investing FEAR TO FREEDOM Real Estate Investing Linda McKissack If you don t design your life, someone or something else will!

2 Contents Letter from the author Begin with the End in Mind Make it Automatic! Holding Wins! Failure is OK Video Lessons 2 Title of the book

3 Letter from the author Do you believe you can be more successful in your life and business than you already are? If you do, you ve come to the right place! One thing we have learned over the years is that there are four major obstacles that can derail your success. If you re not where you want to be, we suspect it is because of one or more of these reasons: - You don t believe it is possible - You don t know what to do or how to do it - You have not yet made it a habit - You have not put it into a system My husband Jim and I have worked hard to build a world-class real estate company, but it didn t come fast and there weren t any shortcuts. We made a decision to change our thinking and our lifestyle, and rose out of $600,000 in debt to build a Real Estate business with over $60 million in sales annually and our real estate investing brings in $2M annually, and passively. A large part of our success has been our ability to overcome obstacles which help build our business. All of what we have accomplished are skills. Simple skills such as leveraging people and time, learning real estate investing, etc. All skills. All which I want to teach to you. As we share with you our secrets, we will be teaching you how to overcome the four obstacles above by mastering yourself, your market, your team (or how to build one), your family, and others in your world. 3

4 #1: Begin with the End in Mind Learning is the beginning of wealth. Learning is the beginning of health. Learning is the beginning of spirituality. Searching and learning is where the miracle process all begins. -Jim Rohn hy are you investing in real estate? WAre you wanting to send a kid to college? Do you want a certain amount of cash flow at some point when you no longer want to work, or can t work? Are you doing it so you can create some kind of legacy for your family? For Jim and I, we wanted a certain passive stream of income by a certain age, and hat was how we originally built our game plan. Next, you need to figure out what type of investment property you are going to buy? In the end, if you re going to have 20 properties, what are they going to look like? Are they going to be four bedroom, two bath? Are they going to be brick? Are they going to be wood with hardwood floors? What do they look like? What is your property criteria, because it's going to be easier for you to make a decision on a property you re going to buy if you know what that criteria looks like. What is your real reasoning behind investing in real estate? These days, I can identify my properties very quickly when they come along and I know which properties I'm not interested in. 4

5 Early on, we fell in love with hardwood floors and old wood-framed houses but it didn't take us very long of getting those expenses of the repairs to figure out that we didn't love those old houses that much. We switched our plan very quickly to 3/2/2s and 4/2/2s that are mostly brick in stable neighborhoods. Setting our property criteria has helped us a lot. Then, how many do I need to have to accomplish my financial goal? Do I need ten properties? Do I need to buy five properties? Do I need 100 properties? What is the number of properties I need to purchase to hit that financial goal that I'm after 10, 15, 20 years from now? Then, the other thing about beginning with the end in mind just knowing that if we don't design our life, somebody or something else will and so, what do we want that life to look like, and how can we use real estate investing to accomplish that? 5

6 #2: Make it Automatic! Anything is possible, in investing, if you put some kind of automatic plan in place. Jim and I always jokingly say we had the DMD, which is the disappearing money disease. Early on in our real estate career, every time we got a commission check it would just go: poof! and disappear. What we learned was if we had some sort of automatic system or plan in place to take a little bit of that money away each month and put it into a savings account, then very quickly we'd have enough money for a down payment on a real estate investment property. The trick is to have automatic financial discipline put in place because what you ll find is that you ll never miss that money (after a short adjustment period). We took our investment money off the top (at the beginning of the month) and put it into a money market account, and when it got big enough to buy an investment property (down payment), we bought one. Automate your investing, or the money will disappear PRO TIP Automate Financial Discipline Having automatic systems in place is a great way to create financial discipline even if you don't have discipline right now. If you're not financially disciplined enough to save, like Jim and I were, you know, remembering to take the money out of your paycheck and put it into a savings account each month, then have that money taken off the top and automatically put it into a savings account, that really helps. 6

7 #3: Holding Wins! Hold and rent or flip and sell? Jim and I have never lost money holding. We have lost money when we flipped a property and got nervous too quickly, but for any property that we've held long term we've never lost money. Buying investment property and holding it long term is a great wealth strategy for just about anyone because it's kind of like a forced savings account. If you hold a property long enough, even if you bought it a little bit high, as long as it cash flows and you're not over leveraged, it will work out. When you look at the historical floors and the ceilings of real estate, property typically doesn t drops below where the last ceiling was. Holding it long term fixes just about any investment situation; where maybe even you've paid a little bit too much. We've lost money on properties that we've flipped, but we've never lost money on properties that we've held long term. It s a great strategy! Be like a postage stamp stick to one thing until you get there. Josh Billings Happiness is not something you postpone for the future; it is something you design for the present. -Jim Rohn 7

8 #4: Failure is OK If you are not willing to risk the unusual, you will have to settle for the ordinary. -Jim Rohn Jim and I bought our first rental property in 1991 and it was a flop. However, the lessons learned from that first flop have made us successful in our efforts today. Fast forward to now and we have over 100 single-family homes, 5 commercial buildings, 2 multi-family structures and 11 vacation rental properties. We all fail! So our very first try, out of the gates, failed What if that stopped us? What if we became fearful? What if we didn t try again? Where would we be? When talking about real estate investing I go on all day about finding the right properties, analyzing them, purchasing, etc. Genisque modi di beat quam que nullatur anisquos But that isn t where everyone should start. You should start knowing failure is ok. The real failure is not trying, or not getting back up after you ve been knocked down. The reality is, Jim and I have learned more from our failures than we have our successes. You won t hit a home run every bat, but as long as you continue to try you re winning. Keep learning, and you could just end up with a truly perfect life. Keep that in mind in your journey and just keep moving forward! 8