It pays to model what the greatest do, and it is no different when it comes to investing. Some of the greatest icons in investing, people like Sam Zell and Warren Buffett, certainly unique qualities and talents, but I would argue that what is most effective in their success were qualities that they chose to develop. Here are the top characteristics of successful investors.
1️⃣ Education
Before playing any game, it is wise to know how the game is played and what rules apply. In a time where information is prevalent, we have great opportunities to learn the information we need to know. Sam Zell, one of the most renowned real estate investors, prides himself with the desire to learn as much as he can in order to have an information advantage. Warren Buffet does precisely the same, with his rigorous daily readings of annual reports. The more information and education you are armed with, the better you are prepared to make wise investment choices.
For busy professionals who seek to invest in apartments, getting educated is the first step. Do not wait until you have the money to get educated. Even then you will not be ready. Learn by reading this blog, checking out podcasts and the recommended books in the resources section, network with others and get plugged in.
2️⃣ Patience
Each great example of a successful investor exhibits patience in finding and selecting opportunities. In the stock market today, we see evidence of impatience. The push for strong short-term earnings, volatile shifts at every announcement and tweet and disproportionate prices paid for earnings (if earnings exist) because of the excitement to get in on the the ground floor. Playing the investment game this way leaves the only winners to be the brokers and those who get lucky on risky trades.
What is the more effective characteristic of great wealth builders is their ability to say no to opportunities in front of them and to seek out better investments that meet their criteria. Today in the multifamily space, investors are paying very high prices in key markets. Some will be barely able to cash flow and are banking on demand growth to reward them for the risk. Having the patience to stick with the fundamentals can be a rare thing.
3️⃣ Discipline
Each example of the highly successful demonstrate great discipline in their lives, and not only in the areas that you’d expect to directly relate to business. This includes getting up early, eating healthy choices, being free of addictions and maintaining strong close relationships with others. This is why in 2020 I decided to implement a 4 a.m. early morning routine for devotion, reading and working on my real estate business. It was transformational and led to discipline in so many other areas of my life.
Each of these important qualities go hand in hand. Patience is a subset of discipline and vice versa could be argued. This should make it simple as you think about how to create discipline in your life and what you can do to take your passive investing to the next level. Make your next steps happen now.
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– How To Use Your 401k To Invest In Real Estate
