Whenever you begin a journey, it is important to know where you are going. As well, it is just as important to know where you are starting from. If you want to go to Chicago for instance, starting from Los Angeles or starting from New York will take a different route. Investing in real estate is the same way. You will begin to see how your unique personal situation will help shape your portfolio of investments. Before you invest in anything, you need to know where you are in terms of income, expenses, assets and liabilities. Knowing where you stand now is critical to how and what you invest in.
If you have not done so recently or ever, write down all of your income and the sources of that income. Next, write down your expenses. This usually takes a bit longer and may take a bit of investigating to find accurate numbers. No one else needs to see this. Accuracy is important. Next, write down all of you assets. These are the things you own that have value. Then, write down your liabilities. These are the amounts you owe to others. Add up the difference between what you make and what you spend. Then, calculate the difference between what you own and what you owe. This will be an eye opening experience for many people.
A person who wants to get the most out of life often has a number of goals they are working on at the same time, in both their personal and business lives. Setting goals is the first step to turning dreams, ideas and wishes, into REALITY!
Recent studies show that less than three percent of the population has written goals. It is no surprise that these are the very same people who are the most successful people in our society. When you set a goal, you commit yourself to a CAN DO attitude. You begin the process of doing what you are dreaming and that is truly a key to success.
Why is it so important to set goals? Mostly it has to do with how the brain works. Setting a goal puts a certain part of your brain into action, especially if your goals are written. If you really want to kick it into overdrive, tell other people about your goals. The more you think about your goals the better your chances of taking action and achieving those goals.
Setting personal goals gives you focus and will solidify an individual's attention into a particular area to the exclusion of other thoughts and activities. The human brain processes thousands of tidbits of information every second. This information comes from the senses, memories and thoughts. The brain processes all of this information and decides which things are the most important to handle now. When you write down your goals, the brain gives more importance to these written priorities. It's like a memo from the President, it gets more attention. If you are constantly thinking about, reviewing and rewriting your goals, your brain becomes more focused and will be much more aware of related opportunities and available resources, which are important to the success of your goal.
When you set a goal, your brain becomes more aware of the opportunities associated with the goal that you might have overlooked or not given any attention to if you had not set that goal. Have you ever noticed that after you start thinking about buying a certain item, suddenly you begin to notice that everyone now has one? It wasn't that everyone else suddenly went out and got the same item, your brain is just more aware of it than before.
Making the choice to set goals in your real estate investing will create a result that far outweighs the person who invests on a whim, like a lottery-ticket mentality or without any concrete path to where they are going.