Investing 101 Lesson 4
Lesson 3 covered How to Become Wealthy.
MANAGING YOUR INVESTMENTS
Management
Proper management of your properties and your investment is essential. Whether you manage the properties yourself or hire a professional property manager, you will find that proper management entails many facets — a few of which we will examine further.
Market Surveys
It is important to know the market in your area, not just selling prices but also rents. Depending on the type of property, you need to contact other owners or managers in the area to find out what current rents are per sq ft. or per bedroom … etc.
Proforma
Before investing in a particular property, always work up a proforma based on your market surveys and knowledge of normal costs and expenses. Don’t just rely on the data provided by the seller.
Tenant Screening
No matter what kind of income-producing property you have, good tenants are the key to profitability. After all, the tenants, through their rent, pay your mortgage and the expenses of the property. Check out the tenants thoroughly; evictions can be a long and expensive process and leave you with no income for the unit involved for several months.
Maintenance
Keep your properties in good repair. Attractive, clean, and neat properties are easier to sell and to rent. Properly maintained air conditioning and plumbing systems help keep expenses in check. Don’t, however, spend a lot on improvements that do not add value.
Re-Invest
Continually re-invest your profits into your wealth accumulation program, and your net worth will soar.
Reward Yourself
Occasionally, you will want to celebrate your success. While it is important to re-invest profits, it is appropriate to give yourself rewards along the way. Whether it is the annual vacation, the occasional game tickets, or even a round of golf, take time to thank yourself for your hard work.
Do Some Good
Always remember to do some good with your wealth. Contribute to your favorite charity or anything that makes life a little better for others. You will be rewarded way beyond what you donate in ways that really matter.
