The Boring and Completely Effective Way to Build Wealth: Passive Investor

How many times have you felt like this?

Here is a sample email that I just received.  True story.

‘The current tenants lease is up for renewal.  They are great tenants and since last summer are now paying above average market rent with the market still softening up. They would like to stay, but with a reduced rent.  You’ve received a couple emails like this before; both times asking $200 lower in rent.  This time your current tenants are asking to have their rent down to $1,200/month at renewal and a one year lease.’

Do you feel your cortisol levels rising?

Having property managers are nice but really they are a mediator between you and your tenants.  You are still the CEO of your properties and that means you have the joy of making hard decisions like lowering rent, approving large repairs, approving tenants, etc.

Sure, being the boss is great, but real estate thing is your ticket to an easier life, not a more stressful one.  Plus, you have other jobs to worry about: you’re the CEO, CFO, chef, parent, and caretaker of your household.

Some days, it gets exhausting, overwhelming and draining – especially if you have a growing real estate portfolio.

I get it. I know first hand how this feels because I’ve lived like this for years.

Simplifying Life – The Passive Investor

Wouldn’t it be nice if you could dissolve all your landlord duties to another investor and leverage their time, talents and skill in exchange for a return on your money?

Doesn’t that sound kinda dreamy?

If you can find the right real estate partner that has time and talent, there is tremendous opportunity for profits.

The hardest part is finding the right partner with the right talent and experience that you can trust handing over your money.

To do this, you need to be proficient in analyzing people and their real estate deals.

Be Like a Shark Tank Investor

BUT don’t be desperate to invest your money for the sake of investing your money.

Be like the shark tank investor and be savvy about both good and bad deals.  Bad deals can sound tempting if you don’t know what to look for.

Here is a great video of one of the  worst shark tank pitches ever to reemphasize how a bad deal looks like.

Do you catch why this pitch is so bad?

Here are some of my takeaways from this video:

  1. The inventors weren’t clear on how to make money

  2. The deal had too much risk and no mitigation plan, which means losing a lot of money

  3. The deal was filled with uncertainty because this is not a proven and tested model

  4. The inventors had no clue that the bottom line is profit.

  5. The investors kept using buzz words to look credible but in reality, it set off red flags to the Shark Tank investors.

To be a good passive investor, think like the Shark Tank Investor and learn to analyze deals.