Are you an optimist or a pessimist? For you, does every cloud have a silver lining; or is the sky always falling? Did you know that your answer to that question could go a long way to determining your eventual wealth (or lack thereof)?
Welcome to Episode #43 - Optimism Can Be Profitable
So over the prior few weeks, I've been speaking a lot about the New Year (2020); and the new decade out to 2030. But for this episode, I'd like to go BACK. Let's go back in time to the year 2010. What was your outlook back then? What did you think would be the happenings and outcome of that decade from 2010 to 2020.
We had just suffered a recession - The Great Recession (which I spoke about in last week's episode). Unemployment was high. Homes were being foreclosed upon on just about every street in the country. There were oil spills and terrorist bombings and continuation of long running wars - plus all sorts of natural disasters. I could go on and on naming all the bad things that were in play in and around 2010 and the years after - not the least of which was the political division in the country that is even worse now than back then - plus all the ever-present issues of discrimination, racism, sexism, hatted, violence, murders and all sorts of crime and injustice.
Anyone could have been forgiven for developing a negative / pessimistic outlook on what the future had in store. Just two years later in 2012 we got the television show: Dooms Day Preppers - which was just a reflection of a popular attitude that had risen in the years before - of... "I don't know what exactly, but something is about to wipe us out - so I'm getting ready for the end (of the world / of the earth, the country, the economic system, law and order, humanity itself) - whatever... I noticed that other day that Dooms Day Preppers is now available on Netflix - If you're still thinking the end is near - go for it!
Hey, I heard on the news the other day that a deadly virus is feared to have infected travelers from a City in China - so now 3 airports here are screening passengers on those flights. So could this be the Zombie Apocalypse virus. Or maybe its the Planet of the Apes virus. Pandemics have happened before, so it certainly could happen again - but my money is still on Alien Invasion - hey, I'm a sci-fi geek.
But even if you're not that pessimistic and you weren't a Dooms Day Prepper (back then or now) - in 2010 optimism of the coming future (the 10 years that we just lived through) was generally lacking in most people. And if it wasn't bad enough already, it got even worse at the end of 2016 / the start of 2017 when we got our current president... Even his supporters cringe wondering what he's going to say or Tweet next. So back then pessimism ruled supreme in the minds and hearts of many (if not most).
So it could easily be said and rationalized... Why invest in Real Estate? - "It could crash again, even worse this time". Why invest in the Stock Market? - "You know, what goes up, must come down". Why start a business? - "Most businesses fail anyway". Why go to school? - "You'll just rack up a bunch of debt". Why do anything that's planting seeds for such an uncertain future?
Now on the other hand - what if you had a more optimistic outlook of the future? What if you had started buying Real Estate back in 2010... How many properties would you have today?
What if you had bought Facebook stock at or near after its IPO in 2012? What if you had bought pretty much ANY stock in 2010 or thereabouts? Now I certainly prefer Rental Real Estate over Stocks any-day (you make money like 5 different ways / maybe 6 versus 1 or possibly 2 with dividends from Stocks). But my point is that if you had invested heavily in either (assuming the right properties and the right stocks) - you'd have made a killing over the prior decade.
Now yes, the RIGHT properties and the RIGHT stocks is a pretty big caveat. But that concern is handled with education and experience, which you could have easily gotten if that had been your determination. So if it had been your focus back in 2010, you could be sitting on a mountain of Real Estate / Stocks or Cash here 10 years later in 2020. That is, IF you had been optimistic enough about the future to take that risk and put in the required time and effort to learn HOW to invest in Real Estate or Stocks or whatever.
I might have mentioned it in Episode #20 with guest (Stock Day-Trader) Chad Kastel - that before I made the decision to move forward with Rental Real Estate Investing at the start of 2015 - at the end of 2014, I was considering taking a class on Stock Day-Trading. It was an orientation class to give details on if you then wanted to sign up for the full paid class - so I was on the path to learning Stock Investing. But I changed my mind just days before the class, cancelled it - and started educating myself on Real Estate. And then once I read the book Rich Dad Poor Dad - I never looked back.
People who had an optimistic outlook on the future and proceeded to educate themselves on investing (because they didn't think the future wasn't worth investing in) - those are the people who killed it over the prior decade. Being optimistic about the future became very profitable for those people.
Now since my focus is Rental Real Estate Investing (not Stocks) - think about the person who has been buying Rental Properties steadily (2, 3 or 4 per year) since 2010. This person may now have as many as 40+ Rental Units - that were bought during what might be the best Real Estate buying opportunity of our lifetimes. You don't buy Rental Real Estate if you're expecting the Zombie Apocalypse at any moment - or if you otherwise don't think the Earth / World, Country or Humanity is going to continue in a way that's beneficial to your investment.
You've got to have a certain amount of optimism to be an Investor in general, but especially so to be a Rental Real Estate Investor - as Real Estate is not a get rich quick endeavor. You'll get rich! But it might take a decade or two. And for those who began investing in Real Estate back in 2010, they had what might be realized someday as the best ever decade for Rental Real Estate Investing - with the added benefit of all-time low interest rates.
Properties were CHEAP and money was almost FREE... But as I mentioned in last week's episode - many of us were late to the party. So how was your decade? And are you optimistic about the one to come? If not, you may not only need to change your mindset - but also your associations.
I've mentioned before the Jim Rohn quote - "You're The Average Of The Five People You Spend The Most Time With". For you, are those 5 people optimistic or pessimistic about life - the future? I'd be willing to bet, they're whatever YOU are.
Because if they're generally optimistic people, they wouldn't want you around if you're a pessimist who always has a cloud handy to rain on their parade. And then on the other side, if they're generally a pessimistic bunch, would they want you around shining the light of optimism all over their gloom and doom fest? No - In either case, it doesn't fit. "Birds of a feather flock together".
So if you're not already, you'll not only need to change your mindset over to one of optimism and generally optimistic thinking - but also you'll need to change your associations, so that the people around you bring you along with them on their optimistic journey into the decade to come.
If you spend any time around me, you'll eventually hear me say something like "Everything always works out for me..." - and that's because it does! Any problem that I encounter, a solution will be found - and in some cases, provided - almost as if divine. I'm blessed. And as such, I'm optimistic about most things, both in my control and not. But there was a time that I was only optimistic about those things over which I had full control - because I only trusted ME.
But that's a very limiting existence, because I can't do everything myself. You've got to depend on other people - which based on your religious outlook, includes God (or the Universe if you prefer). And the Universe provides for those who provide for themselves.
So get something in works for yourself this year. Be optimistic about its success. And as much as it depends upon YOU, commit to doing the needful - daily, weekly, monthly - to make it happen. Leverage other people to make it a reality. Remove from your life (or greatly limit access) those negative people who are more than happy to tell you what you CAN'T do and why something WON'T work.
In a coming episode, I'll speak more about limiting negative association - and surrounding yourself with positive people. Because from this day forward, you're an optimist and you've got no time and no ear for those who are not also optimistic about the future. You can't let 2030 arrive and look back over all the missed opportunities. Make this your decade! I know its going to be mine - because everything always works out for me. And there's nothing that I can't do... How about you?
So I'm a sci-fi geek, which means I believe (even hope) that life exists on other planets. They might be on their way here right now to end life on this planet as we know it. That could mean to wipe us out, and steal our planet's resources; or even to make us their food ("To Serve Man") style - as is the typical sci-fi result of "Alien Invasion". Or a more optimistic take on it, could be that they end disease and even aging itself - share their knowledge, technology - and take us to the stars. I say all of this because...
This 43rd Episode of the... and Landlord Podcast is about Optimism versus Pessimism - and how a person with an Optimistic outlook over the past decade (since 2010) had a much better chance of profiting financially than did someone with a Pessimistic eye towards the future.
Here I go into some of the many reasons a person might have legitimately had for being a Pessimist. But how resisting that tendency could have been very profitable - especially in Rental Real Estate Investing, or even Stocks. I explain how I'm an optimist in most things... I'm not expecting the Zombie Apocalypse. I'm not expecting an Alien Invasion. Not looking for a meteor to strike. Don't expect the government to fall or the economic system to crash (again) - at least not anytime soon.
So I am proceeding with an Optimistic outlook towards the future. And as such, I'm making investments NOW, that I fully expect all will still be around (including myself) to benefit from in that future. And I make the point that a person who had that outlook in 2010, and acted accordingly - likely had a great decade. Are you an Optimist or a Pessimist? What do you expect the next decade to hold for you? Because Optimism can be Profitable.