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179: Habits – Friday Fundamentals

Real estate investing is, as you know, not a get-rich quick game. If so, I’m playing it wrong and you should not listen to anything else I ever say.

Anything worth having or doing rarely comes easy. There’s almost no such case as an overnight success. Sure, you may hear that term used a lot, but in all likelihood that overnight success took years, and only one day was it realized as a success. Success is often not accidental, but the result of being intentional with a purpose. Living intentional is a three legged stool comprised of:

  1. Vision
  2. Goals
  3. Habits

Vision is the big picture. This is how you want your life to be, what you want to do, how you want to spend your time, and who you want to spend your time with. Without a vision, you’ll live your life like a bottle floating in the ocean, going where the currents takes you.

With a vision, you can set some goals that will help you achieve that vision. These are stepping stones to make that vision a reality. From long term goals, to short term and immediate goals, these will help you keep on track to living a life you want.

A vision with goals alone won’t actually do anything if you never act on them. You must take action towards your goals in order to realize your vision. This action is where the rubber meets the road. It’s also where a lot of people stumble and get tripped up. Think of those new years resolutions. You’re going to “get in shape” and “eat healthy” so you can look good on that summer vacation you have planned. Great! Then comes February and you find yourself falling into the same routine as you once were, not taking the steps you actually need to get that summer body. So how does one take consistent action day in and day out? Habits.

Habits are one of the most powerful tools we can use. Habits, both good and bad, shape who we are and what we do. Our success and failures are a product of our habits. Habits are the building blocks for success.

“Every action you take is a vote for the type of person you wish to become. No single instance will transform your beliefs, but as the votes build up, so does the evidence of your new identity.”  ― James Clear

When you make the right actions a habit, you are building momentum towards achieving your goals. Developing good habits are the equivalent of putting your actions on autopilot.

Let’s take investing in real estate as an example. If your vision is to achieve financial freedom by investing in cash flowing real estate, then your goal may be to earn $4,000 per month in passive income. Breaking this goal down, you determine that in order to earn $4,000 per month will require owning 20 rental properties that cash flow $200/month. Now, put a plan in action! You’ll have to search for opportunities, analyze deals,  make offers, and manage your investments. This is where forming good habits will help.

James Clear outlines 4 steps to building a habit in his latest book, Atomic Habits. They are:

  1. Make it obvious. Set out reminders, organize and prepare a work space, and make visual cues for getting the things done you need. It might seem obvious in your mind, but make it explicitly clear how you will do it. Define exactly what you will do, when, and where – “I will analyze 1 deal every morning at 7 a.m. at my computer desk”.
  2. Make it attractive. If you can couple an attractive action with one you need to do, then you are more likely to do both. After you analyze one deal, then treat yourself to a cup of coffee or take a few minutes to relax and check up on your social media.
  3. Make it easy. If your habit isn’t easy, then you’re less likely to follow through with it every day. Decrease the number of steps between you and the action. Have your computer turned on, calculator opened, websites up, etc.
  4. Make it satisfying. Reward yourself for your hard work. This reward will keeping you coming back to the habit.

These four steps may sound simple and obvious, but rarely do we do each and every one of these things when trying to develop a good habit.

Consistency is key in building any habit. It can be tempting to give up if you miss a day of building your new habit. It’s okay; things will come up. Recognize that you’ve missed a day and then get back immediately to building that habit. Don’t get discouraged if you’re not seeing immediate results. Building habits takes time, and results take even longer.

Give some thought to you vision, set goals to make that vision a reality, and then develop habits to achieve those goals. With this three step formula you are capable of achieving anything you put your mind to.

 

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