Each of us have varying degrees of risk aversion and fears when it comes to learning a new topic or trying something new. Especially because of our backgrounds, education and childhood rearing much of who we are is ingrained within us and hard to change.
When it comes to financial education, it is extremely difficult to modify ones own desires, create new goals and commit to taking action; for these reasons it it could be challenging to gain alignment from your significant other, mainly because each of you are two different people who likely have different past experiences. So how do you talk to your significant other about this new idea of passive investing in multifamily? Below are a few simple tips:
1️⃣ Align On The Collective Vision
In this earlier article I discussed the criticality of couples being aligned on the collective or family mission. Simply put, without this alignment regarding where you want to be and how you will get there, there will be ongoing difficulty in making decisions to invest. Think of the alignment as the road map with a clear destination. Without having identified and agreed to that destination and how to get there, you are each likely to waver between helpful decisions, harmful decisions and inaction altogether.
Below are a few great example of a shared vision:
- Generate enough passive income to become “job-optional.”
- Pay off family residence and live freely
- Create a lifestyle of travel and adventure
- Obtain margin and time to become part-time volunteers at our church
2️⃣ Discuss The Advantage of Real Estate
As a test of your own knowledge and communication abilities, it is good to be concise and start with the basic attractiveness of the real estate asset class. To help with your own knowledge and articulation of these advantages, the following are a few example topics that are linked to very detailed articles:
- Why everyone should own real estate.
- How wealth is created from real estate
- The difference between active and passive investing
- Myths of resale state investing
- Why multifamily?
- How people create freedom (time and money) from passive investments
3️⃣ Show The Facts
Some people prefer data over words. Rather than discuss your “feelings” about financial freedom and the sentiment of diversification, it can help to focus on proven details. At a high level, it could be beneficial to know that most of the wealthy have either built their wealth from real estate or hold some portion of it in the real estate asset class. At a more micro level, when sharing with your spouse a new passive investment opportunity, it could help to readily have the operator’s track record.
- How many deals have they done?
- How long have they been in this asset class?
- Have they done a deal full circle?
- What did the returns look like in the last deal and how do they align with our criteria?
4️⃣ Test and Evaluate
The best way for new investors to get started is to test the waters with less capital. Most new investors that I speak with understandably are more comfortable investing on the lower end of the spectrum to test the waters and evaluate from there. The benefits of a trial of your first passive investment is that it is less to worry about and you can evaluate your thoughts and the performance of the investment. Most importantly, you and your spouse took a significant step in your journey to wealth creation!
Bonus: Share Great Resources
As a bonus, and perhaps the most effective tool for spouses, our final suggestion is to share in the consumption of great investment educational resources. This includes podcasts, blogs such as this one and books. Remember not to overwhelm. Even 5 minutes of consumption can help reshape mindsets and motivate towards action!
Luckily for you, we have a Passive Investor Resources page that is full of great places from which you can learn and grow. Also, you can download our free Passive Investor Startup Guide and read it together.
We hope these tips are useful to you and your family as you take your journey towards diversification, wealth-creation and time freedom! As usual, reach out to us with any questions.
Safe investing.
RRII
💡Invest Your Retirement w/ eQRP
– How To Use Your 401k To Invest In Real Estate
