Investing in Real Estate while Active Duty

When people find out that I do real estate investing in addition to my “9-5” as an active duty Naval officer, they tend to be surprised. It can definitely be challenging at times, and I’ve made a lot of mistakes along the way. However, in order to reach my long-term goals, I know that investing in real estate in my free time is an absolute MUST. 

I know there are a lot of fellow military members out there who have similar goals, but they just don’t know how to get started or what it will take to achieve those goals. 

If you want to be successful in real estate while serving your country, starting with the right mindset is absolutely critical. There are also some practical steps you can take every day to make your goals become a reality.

Focus On Why

Having a strong ‘why’ is critical to achieving any goal, and real estate is no exception. Any journey worth taking will have significant obstacles along the way. Are you mentally strong enough to push through these obstacles and stay on the path to success? Your ‘why’ does not have to be limited to your business or personal life. I have strong ‘whys’ for both my personal life and for Honor and Equity.

For example, one of Honor and Equity’s long-term goals is to be able to provide free housing to veterans. I have no idea how H&E will achieve this, and it may take years to accomplish, but the only way H&E will not hit this goal is if I quit. When I hit obstacles, I just take a step back, take a deep breath, and think about how awesome it would be to help out veterans in need of a good home. It helps me re-focus on the big picture and on why I’m doing this. 

If you are married, I highly recommend working on your personal ‘why’ together with your spouse. My wife and I have a long-term goal to completely replace our W-2 income with passive income from real estate and businesses by the time we’re both out of the Navy. This goal will give us the freedom to live where we want, spend more time with friends and family, and only do work that gives us a strong sense of purpose. 

If you want to learn more about the value of a strong ‘why’, I go more in-depth in this article.

Your Network Determines Your Net Worth

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Real estate is a team sport. There are simply too many elements in real estate investing to reasonably expect to do them all by yourself. Some of these elements include finding deals, closing deals, financing, project management, improving and repairing properties, finding tenants, managing tenants, and bookkeeping. If you try to do all of these yourself, you will likely fail. 

If you are just getting started in real estate investing, the first thing I would do is join a mastermind group with a focus on real estate. In doing so, you will surround yourself with people much more experienced than you and will benefit from their experiences and wisdom. Real estate investors are highly motivated to help others! Don’t be afraid to ask for some advice. 

You should also consider partnering with someone you trust when you’re getting started. Make sure your skill sets complement each other. If you are more of a numbers guy/gal and enjoy analyzing the deals and figuring out the financing, then you should partner with someone who excels at managing a project, communicating with vendors, and perhaps finding the deals.  

Regardless of who you work with and what task you’re doing, make sure you are providing value to others. No one likes the person who only takes from others – be it time, money, or advice. I recommend adopting a generous mindset and focus on helping others however you can. It will come back to you!

Make the Most of the Time You Have

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Juggling a full-time job such as a military career with real estate investing on the side is demanding, however, my Navy job always takes priority over anything real estate-related. Managing my time effectively is crucial, and it’s always something I’m trying to improve upon. 

Something I have learned the hard way is: don’t try to do too much in one day or one week. The intensity of my work schedule ebbs and flows, so some weeks I have more free time to work on the business/real estate than other weeks. I’ve learned to adjust my weekly business goals to make them attainable based on my work schedule. The weeks I didn’t do this, I found myself overwhelmed and frustrated at the total workload. This is a marathon, not a sprint, so I have to constantly remind myself to adjust my weekly and daily goals to make them attainable and not overwhelming. 

If you want to succeed at anything, you must take consistent, daily action. I started using a daily planner to help me be more consistent. Last summer, I used Brandon Turner’s Intention Journal, and while I enjoyed it, I have since transitioned to the Panda Planner Venture Edition. It is reasonably priced ($13 on Amazon), and has sections to write down business-focused elements such as your core purpose, core values, and long-term goals, in addition to quarterly, weekly, and daily to-do lists. 

I wake up early every day (usually by 0530) to work on the business. This gives me a couple of hours each day to reply to emails, analyze properties, create content, or whatever I have prioritized for that day. 

I use my daily planner to track not only business items, but also use it to make sure I exercise and read every day, and I use the notes section in the back to write down ideas, meeting notes, and more. 

Bonus Tip: You Don’t Have to Live Where you Invest

This concept was first introduced to me by David Greene’s first book Long-Distance Real Estate Investing – one of my favorites. Once I realized that you don’t have to live where you invest, it opened my eyes to the endless opportunities available to investors. Most people believe they have to live in the same location they buy property. This is simply not true. Why do we feel the need to walk through a home before we buy it? Unless you’re a professional inspector or appraiser, this doesn’t add much value for a home you will never live in. People are uncomfortable buying a property they haven’t seen before, but are perfectly comfortable buying shares in a publicly-traded company they know almost nothing about.

If you are facing this mental hurdle, I challenge you to look past the emotional components of this limiting belief and try to think more logically about it. Read the aforementioned David Greene book, and connect with other investors who have overcome this mental hurdle. You’ll be glad you did!

I hope you enjoyed this article. If you’re interested in more real estate, personal finance, and investing insight, follow @honorandequity on Instagram and Facebook. If you want to connect, send me an email at doug@honorandequity.com!

7 Lessons I Learned in 2020

The author and his wife earlier this year in Idyllwild, CA

It’s important to reflect on your life regularly. I try to do this daily to maintain perspective and focus on the bigger picture rather than get bogged down in life’s daily minutiae. It’s also valuable to reflect on self-improvement. As the curtain falls on 2020, I thought I would share some things I learned throughout the year. 

Your Network is Critical

I like reading autobiographical books by successful people. Within these books, I have never once read something resembling “I did it all by myself. No one helped me get here”. Rather, the opposite is true. No successful person got to that position by themselves: it takes mentors, coaches, employees, family members, friends, and even enemies to encourage and inspire that individual to achieve their big goals. I’ve noticed this is especially true in real estate. If you are finding the deals, financing the projects, doing the rehab yourself, and managing tenants, you’re doing it wrong, and you will likely fail or burn out unless you build a team of experts around you. 

Always Provide Value to Others

I read an insightful book this year titled “The Go-Giver,” which extolls the idea that you must focus on empowering others to achieve their goals to be successful yourself. No one likes being in a partnership or relationship of any kind that is one-sided. We must consider what the people in our network are trying to accomplish and do everything we can to assist them, whether we get anything in return or not. Give without the expectation of receiving anything in return. 

Photo credit @elcarito via unsplash.com

Don’t Set a Reading Goal Based on Total Number of Books Read

There are very few activities I enjoy more than reading. Just give me a good book, a comfortable chair next to a window, and a cup of coffee, and I’m a happy guy. At the beginning of the year, I set a goal to read 50 books. This number was double my goal for 2019, which I exceeded by 1 or 2 books. That sounds like a substantial goal, right? The problem was, I noticed that when deciding on what book to read next, I tended to pick shorter books so I could hit my monthly quota of 4 – 5 books—erring towards shorter books resulted in some more enormous tomes feeling lonely on my bookshelf. In 2021, I will adjust my goal to focus on the number of pages read per day. When I sit down to do my weekly goals every Sunday, I will look at my schedule for the week and decide a daily page number that is attainable. This way, I won’t be discouraged from reading the larger books. 

Plan Long Term, but Take Action every day

Consistent, daily action is a cornerstone of success. But so is making significant long-term goals, right? “The One Thing” by Gary Keller and Jay Papasan taught me that you have to take that big goal you want to hit ten years from now and break it down into progressively smaller chunks to the point that you ask yourself, “What can I do today to make progress toward that goal?” Incremental progress every day eventually results in the achievement of massive goals. This concept applies to business development, fitness, nutrition, relationships – anything you can want to improve in your life. 

Daily Planners Work

When I signed up for a Bigger Pockets Pro account earlier this year, they sent me a free Intention Journal as well. I had heard Brandon Turner (the ‘author’ of the journal) talk about daily planners and their value but never started doing it until they sent me the free 90-day Intention Journal. Wow! I love using it. You write down your goals for the 90 days, then create a plan for the upcoming week for the steps you will take to get you closer to those goals. I use the journal to track my real estate progress, personal fitness, daily reading, and more. As I came closer to filling up the pages of my Intention Journal, I researched different kinds of planners. I decided on the Panda Planner: Venture edition, which is designed for entrepreneurs. There are many kinds of daily planners and journals out there, but I highly recommend you pick one up and start writing down your goals and planning out your days. If you do this, I’m 100% confident you will see more progress towards your goals! Do you have a planner you like a lot? Send me a message on Instagram or an email to doug@honorandequity.com. I’d love to hear about it.

Work on Your Business, Not in Your Business 

Entrepreneurs feel like they have to do everything. “If you want it done right, you have to do it yourself.” This mindset is common at the beginning of any business venture, but if you ever want the business to scale or succeed on its own, you have to delegate and outsource tasks. When I started the Honor and Equity Instagram page, I made the content for the first few months. It was very time consuming: I had to come up with ideas, find images that worked, design the post using social media software (I use Canva), pick what I hoped would be the best hashtags, and come up with a witty caption. I realized I was spending too much time on social media and not having enough time to connect with military members, write helpful articles, and learn more about real estate and investing. This realization led me to hire a virtual assistant to create content for me, so I have more time to work on my business. 

I can’t outsource everything, but I try to regularly assess what I’m doing that feels light and what feels heavy, and I outsource those things that feel heavy. I will likely hire a virtual assistant bookkeeper in 2021 to manage the month-to-month income and expenses for our real estate portfolio. When you hire people, you are creating jobs and enabling them to do more of what they are good at. The owner of a company should be working on the business, not in the business. 

Photo credit @clemono via unsplash.com

Hire Slowly, Fire Quickly

Back in May, I had to fire the property management company that manages our Milwaukee properties. They had become progressively worse with no sign of improvement, so I switched to a fantastic company that performs better and charges less. I knew it would take time and would be inconvenient to change, but I also knew the old company wasn’t performing at the level I expect, so I pulled the trigger and never looked back. It was the right decision. I also had to fire the first social media virtual assistant I hired only a few months ago. He did not communicate well, couldn’t follow basic instructions, and was even dishonest a couple of times. I hired a different company that does much better work and is more professional overall. They are double the price of the previous guy, but it’s worth it. 

In both of these situations, there came the point that I knew it wasn’t the right fit. Once you feel that, you have to end the partnership quickly. Prolonging the relationship will only make things worse for yourself and your business. However, hiring the replacement should be a slow, deliberate decision based on past performance, references, and the degree to which you think they will be compatible with you and your business. I can only work with people who are exceptional communicators. If they take days to respond to a question, they’re out. If they can’t get to the point quickly and tend to dance around the topic at hand, they’re out. You probably have different priorities, so you should communicate those priorities and expectations upfront with a potential hire and ensure they can meet those expectations. 

I hope you gained insight from this article. Please send me a message on Instagram @honorandequity or send me an email at doug@honorandequity.com and share your thoughts!