When self doubt creeps in

[devo76]

Hi all.

I'm mid 30,s now married happy great job and a 13 month old boy.
Bought a house in my early 20s and spent the rest if my 20s having the best time of my life. Late in my 20s I started to realise that apart from a sore head and some damaged brain cells I didn't really have much apart from a low mortgaged home. Looking at my parents and family who have nothing and are staring down the barrel of retirement on a pension. I had to do something

I bought an investment property.
Not a great one but a foot in the door knowing time is what will creat my wealth
Bought another a few years later but this one had a dual income with subdivision potential. Some time later I decided to subdivide and wow what a lesson.that was hard work.
Today it's all but completed but he'll it nearly broke me.

Today 6 years into my investing journey I have 4 properties, 3 incomes but far far from some of the success stories on here.

And this is the self doubt bit.

When you take my PPOR out of the equation nothing has performed great. Low growth in my first purchase and after the stress of my subdivision I have about $75,000 in equity but hell there were easier ways.

At times I question why I have done what I done. I know I have laid the foundation for growth but its too distant to see yet.

I know this is not uncommon and I figure doubt is ok as long as I don't sell everything in disgust. Just wondering how others push through.
How do others stay motivated to stay on the path

Cheers

 

[ok180]

The problem is that few people really make their money in property when they are young. Its better to invest in your own skills or a business when your younger to make money then lock it away in investments which will grow over time. You really need a few cycles to make it work.

 

[Fox89]

The problem is that few people really make their money in property when they are young. Its better to invest in your own skills or a business when your younger to make money then lock it away in investments which will grow over time. You really need a few cycles to make it work.

This go s against everything I have learned about investing.

 

[ok180]

This go s against everything I have learned about investing.

How many wealthy people under 40 do you know who made their money from property compared to business and/or investing in their skills?

 

[Propertunity]

Just wondering how others push through.
How do others stay motivated to stay on the path

There's really only 2 things that motivate in this area (AFAIK).
Fear of loss / Desire for gain.

Fear of loss:
1. Go visit with some older people who did not invest and are trying to eek out an existence on the pension.
2. Go see some people on the public hospital waiting list, taking pain killers every day waiting for a new hip/knee operation being told there is a 2 year wait - and they have no private health insurance.
4. Your 13 month old will be at school before you know it. You and the Mrs go visit a public school in your area for 1 day. See if you want junior taught by those teachers and playing with those kids. Do the same in a Grammar School / Private School - see which one you'd prefer.
5. In other words, go see what you do not want.

Desire for gain:
1. Hang with some wealthy people for a while.
2. Rent a lifestyle for 1 day - rent a yacht, supercar, harbouside mansion - see if you could see yourself living like that every day.
3. Go visit a 3rd world country - see if you don't come home with a desire to make more money to go help - donate to a charity, adopt a baby, start an orphanage or whatever.

If you are truly unselfish, then instead of doing things for yourself and your family, do it for others.

Don't hang with people you don't want to be like - the attitude rubs off. It is all between your ears - as the proverb says "As a man thinketh, so is he".
Put a stop to the stinkin' thinkin'. You can do better. You are doing better than most by having a go at something. Improve your skills. Be better.

 

[Rolf Latham]

3. Go visit a 3rd world country - see if you don't come home with a desire to make more money to go help - donate to a charity, adopt a baby, start an orphanage or whatever.

If you are truly unselfish, then instead of doing things for yourself and your family, do it for others.

I think thats what my mentors call significance, vs what society sees which is success

ta
rolf

 

[devo76]

As I touched on before. My parents don't have much. One has little income and a big mortgage on her home and little super( over 60)
My old man is the same and probably has less super than me.

What scares and motivates is in their earlier day( still married) they had investment land in a few places but sold after a short time. There life could have been different. While I'm happy that I invested at times I fear the same path they chose.

My plan has always been to buy and hold until I'm on the other side of 50. I just hear a little voice of why in my ear. Normally easily ignored but in the trying times like the last 12 months I have been tested by my own thoughts.

 

[redwing]

It's the enemy in the mirror

There's a good thread here, I like Sash's post also

 

[redwing]

Also this one by Rob

My mindset journey

well worth a read, or re-read

 

[jingo]

Today 6 years into my investing journey I have 4 properties, 3 incomes but far far from some of the success stories on here.

And this is the self doubt bit.

When you take my PPOR out of the equation nothing has performed great. Low growth in my first purchase and after the stress of my subdivision I have about $75,000 in equity but hell there were easier ways.

At times I question why I have done what I done. I know I have laid the foundation for growth but its too distant to see yet.

I know this is not uncommon and I figure doubt is ok as long as I don't sell everything in disgust. Just wondering how others push through.
How do others stay motivated to stay on the path
Cheers

Hi Devo,

Its normal to question your decisions and wonder if you could have achieved more by taking another path etc etc. Just imagine the position you'd be in now if you hadn't have bought your house in your early 20's? Would you have the 3 investment properties now? (I doubt it).

Regarding the performance of your IP's - perhaps have a look at growth rates in the areas you have bought and compare them with similar properties.

If your portfolio is nearly neutral or positively geared then I'd hang on. You could try doing some projections of how much income you'd like to generate from your investments and see whether your properties will end up giving you this.

If so, continue - if not, perhaps tweak your plan by investing in shares or other assets. (It may be possible to keep your resi as well).

A wise investor on this forum once advised me to 'follow the numbers/maths' when trying to work out the next step to take.

Perhaps an excel spreadsheet with some projections would be a good starting point?

All the best with it,

Regards Jason.

 

[BayView]

I know this is not uncommon and I figure doubt is ok as long as I don't sell everything in disgust. Just wondering how others push through.
How do others stay motivated to stay on the path.
Cheers

If the properties aren't costing you much/anything out of pocket, and you don't need to sell, you may as well hang on to them for another cycle to see what happens (the news will usually be good).

But, you may find like so many others that Resi is not for you.

Maybe alter the path slightly and look at a subdiv again - but with more knowledge this time around, or move away from Resi into Commercial such as Dazz and others have done - a lot more hands-off with respect to tenants' cr@p.

We moved away from Resi into business, which for us on this particular transaction hasn't been what I envisaged, so far.

Some mistakes were made and I have learned a lot for the next one, and the plan will be to use the trappings to buy more R/E (but Commercial - not Resi) to store and growth the wealth and the income.

I think to make money out of R/E as a business per se which is your only pastime means either become another Nathan, or become a developer full-time.

To buy normal Resi properties in the hope that they will become your replacement of job and income in a few short years is probably never gunna happen...use it as a supplement that will hopefully springboard you into other things that will set you free might be the way to think of it.

 

[devo76]

Cheers for the replies everyone. I have had what I feel are modest and achievable plans when I started.
That is to achieve about $1,500 per week in disposable income for retirement in my early 50,s. not interested in pulling the pin much earlier.
Basically I would need about 6 average houses paid for to achieve this.
Still achievable but accumulation has been slow the last year or so during the subdivision and build.
Currently my portfolio costs about $50 per week and my PPOR is only a little more. So basically no pressure to sell.
Like I said just a small bit of doubt creeping in after this drawn out period.
Nothing has really changed and I'm not far off my plan. Another 20% CG would kill the doubt I think so just have to sit tight and trust I have done the right thing. I know I need more time in the game. I sure as hell don't want to be that person that talks with regret about what they sold and what they would be worth if they didn't sell.

Cheers

 

[ok180]

Cheers for the replies everyone. I have had what I feel are modest and achievable plans when I started.
That is to achieve about $1,500 per week in disposable income for retirement in my early 50,s. not interested in pulling the pin much earlier.

That's not a hard goal to acheive, you might only need another 1 or 2 properties to get there. Try to add value to the properties you already have, then let the loans tick over to P&I and you will easily have $1500 in todays money by the time you are in your early 50's with all the properties unencumbered.

Like I said earlier, just sitting on invest properties or doing small developments won't make life changing amounts of money when your young. If you want that you either need a succesful business or a very good Job. If you do not desire bringing in 5k-10k dollars a week from your business/job skills keep doing what your doing and enjoy the ride.

 

[K_Raheja]

There's really only 2 things that motivate in this area (AFAIK).
Fear of loss / Desire for gain.

Fear of loss:
1. Go visit with some older people who did not invest and are trying to eek out an existence on the pension.
2. Go see some people on the public hospital waiting list, taking pain killers every day waiting for a new hip/knee operation being told there is a 2 year wait - and they have no private health insurance.
4. Your 13 month old will be at school before you know it. You and the Mrs go visit a public school in your area for 1 day. See if you want junior taught by those teachers and playing with those kids. Do the same in a Grammar School / Private School - see which one you'd prefer.
5. In other words, go see what you do not want.

Desire for gain:
1. Hang with some wealthy people for a while.
2. Rent a lifestyle for 1 day - rent a yacht, supercar, harbouside mansion - see if you could see yourself living like that every day.
3. Go visit a 3rd world country - see if you don't come home with a desire to make more money to go help - donate to a charity, adopt a baby, start an orphanage or whatever.

If you are truly unselfish, then instead of doing things for yourself and your family, do it for others.

Don't hang with people you don't want to be like - the attitude rubs off. It is all between your ears - as the proverb says "As a man thinketh, so is he".
Put a stop to the stinkin' thinkin'. You can do better. You are doing better than most by having a go at something. Improve your skills. Be better.

Some fine gems here..
thanks for sharing Propertunity.

 

[K_Raheja]

.........
To buy normal Resi properties in the hope that they will become your replacement of job and income in a few short years is probably never gunna happen...use it as a supplement that will hopefully springboard you into other things that will set you free might be the way to think of it.

Bayview, thanks for the insight..
quick question.. wouldn't several cashflow + properties could be replacement of a job for some (depending on lifestyle cost etc )

 

[HotRod]

Bayview, thanks for the insight..
quick question.. wouldn't several cashflow + properties could be replacement of a job for some (depending on lifestyle cost etc )

Worked for me.

If you keep on buying NGed properties you need to keep on working to service the debt. un

 

[Peter 14.7]

At times I question why I have done what I done. I know I have laid the foundation for growth but its too distant to see yet.

I know this is not uncommon and I figure doubt is ok as long as I don't sell everything in disgust. Just wondering how others push through.
How do others stay motivated to stay on the path

Cheers

You have achieved a lot. Dont despair.

One thing stands out: 6 years.

The last 6 years has not been kind to any investment. Property the same. But when it turns and EU GFC aside, it does, property will jump.

As they say, it is not timing the market but time in the market.

Example: my

PPOR bought in 1996 for $235k sold in 2006 for $521k.
IP same as & around the cnr, in 2000 for $331 sold in 2003 for $570k.

What does this say? if the first a bad deal? No what is says but planning a treaty and some luck and nerve I made a killing on one but buying a before boom and selling top of boom.

And then this;

IP I sold in 2003 for $570k. Sold again in 2010 for $605k. Probably worth now $750k.

Again, property goes flat and then jumps and supply and demand goes out of kilter.

Overall you seem to be going pretty good for 30 something. I have 30 something friends with only a PPOR still owing 80% LVR and three kids.

Hang in there, Peter 14.7

 

[kathryn d]

It's costing you very little to hold onto your investments.
You are still young.
Sometimes you just need to plod along.Try not to get discouraged.YOu are further ahead than most of the population. Take pride in that.

I was in my mid 40s before we even started. All we accomplished in this time period was having a paid off PPOR.
After 6 years of buying rentals, I quit my employed job and we lived solely on rent.
To many, we live an extremely frugal lifestyle..but for us, it works.
Most of our properties have rarely increased significantly in value (Canada) but they are CF+. The economy is hard where we own properties, and breaking even, while paying down debt, is all we hope for.
All I wanted was to not rely on a government pension. For us it is really easy, because we are not materialistic. Just dont try to keep up with the Jones....they are mostly all show anyways.

Good luck.

 

[Peter 14.7]

All I wanted was to not rely on a government pension. For us it is really easy, because we are not materialistic. Just dont try to keep up with the Jones....they are mostly all show anyways.

Good luck.

Ditto. The recent GFC and crashes in house prices in Toorak and Mosman shows the so called wealthy have no savings and live beyond their means.

All this " I am rich at 29" is BS in 99% of the cases.

Peter

 

[BayView]

Bayview, thanks for the insight..
quick question.. wouldn't several cashflow + properties could be replacement of a job for some (depending on lifestyle cost etc )

Well, the key word is several.

How many folk can say with total honesty that they have IP's with nett $100 per week in rent after tax?

If this is the case, the you'd need arguably about 10 to be able to live a half decent lifestyle.

If it's $50 per week, then you need 20 IP's, and so on.

I don't know many folk with 20 IP's full stop; let alone 20 which are pos.