Forging Past the Fear

Well I did it! I gave my one-hour presentation to the MBA students at Utah State University on ‘How to Make Millions by Wise Investing’. If you recall from last week’s post, this speech had caused me some fear and anxiety. But after 5 or 10 minutes the fear and anxiety that had been gripping me diminished and finally totally disappeared. The students were great, as was the professor. They asked some great questions and it all went quite well. Yay! I guess I acted out the title of Susan Jeffers great little book Feel the Fear and Do It Anyway.

It’s fascinating to me that a huge percentage of people don’t step outside their comfort zone when it comes to investing as a direct result from that thing we know as fear. It might be fear of the unknown, fear of losing their money or sometimes just plain fear of taking any risks at all. I look back at my younger years (now called “my warrior years”) and remember how quite a few of my peers, people that were just as smart as me and sometimes a lot smarter, knew what I was doing and how I was doing it and, yes, knew that I was having some very big financial gains. However, they didn’t dare step up to do the same thing I was doing. I’m pretty sure the reason was primarily because of fear.

Looking back now I’m pretty sure I didn’t share with them that I had huge fears myself. The thing is, I forged ahead anyways and took the risks and it paid off. I wish I could go back in time and share those fears that I felt with those friends. I think if I had done that then many of those people might have taken a few more calculated risks, pushing past their fears and ending up with the kind of success that I experienced.

I think you would agree that many of our fears come from us thinking  things like “Oh, what if I fail? What will my friends and family think of me? What if I lose all my money?” But like I told the MBA’s, everyone fails from time to time! The key is to learn from your mistakes and be sure not to beat yourself up. It’s okay to fail. No human is immune to failure but if you pick yourself up and keep trying, your success, in investing to create your fortune or just about any part of your life, will far outweigh your failures.

The Difference a World View Makes

 

As I write this, I am flying at 32,000 feet over the Atlantic Ocean. Yes, that might be a pretty incredible thing for some but the incredible things on my mind are the wonderful people that we met in Ireland and the great beauty of the country side. We just spent 8 days there (my wife is part Irish but had never visited Ireland). What a wonderful country, with the greenest of  green lands  you’ll ever see and such friendly, kind people.  We flew into Dublin and rented a car then had the scary experience of driving on the wrong side of the road-at least it’s the wrong side as far as us Americans are concerned. I only screwed up twice but quickly corrected and we survived!

We drove from Dublin up to what is called the Carton House, a huge estate with a castle that is now fixed up as a hotel complete with two 18 hole golf courses and all kinds of other amenities. You see, my wife is a Carton and her family history was traced way back hundreds of years ago to the Cartons and the Fitzgeralds, both famous and very well to do families of Ireland. So we just had to visit and stay in the Carton house. We had a great time there and later drove (very carefully) to Kilkenny, the town made fun of on South Park.

Just before we left, we watched the big Gaelic Football finals. I’d never heard of the game before. It’s a combination between soccer, American football and basketball. They run with the ball, dribble it, pass it forward and backward, and kick it for a score. It’s a hugely exciting game; I loved it.

So there we were in an Irish Pub just a few blocks from the stadium packed with over 80,000 screaming fans and next to us was a beautiful couple. In short order we struck up a conversation and discovered they were from Hungary. They were such fun people. I liked them so much I insisted that I buy their lunch. It was like we were almost best friends by the time we finished lunch. That was such a great feeling and left me with such great memories. I sure hope to see them again some time, some place.

That chance meeting brought back memories of all the great people I’ve met in my life from so many different countries and cultures. I’ve had the great privilege of experiencing so much of this great world we live in and have learned so many great lessons from other cultures and peoples from my travels. The biggest life lesson I’ve learned from all these travels, at least for me is simply this:

To visit other countries and cultures and other people with different beliefs, habits and different views of the world can give us all a better and bigger mind and help you and I to be more open minded and accepting of others.

And that, my friends, is what this world needs more of. In my own personal opinion that would lead to a much more peaceful and war free world and would be a big blessing to each and every one of us. Do you see my point? I can only hope that you too will agree.

 

 

The ‘Refrain but Don’t Repress’ Approach to Destroying Bad Habits

As human beings, we have many good habits that we’ve formed and held onto in our lives and then there are some bad habits that we’d really like to dump. Like most of us, you have probably observed and experienced how very difficult it is to change bad habits, whether the bad habit is overeating, overworking, sleeping too much or too little, watching too much TV, checking our email or text compulsively or some even worse habit or addiction.

In the last few weeks I’ve been reading an incredible book that I believe sheds tremendous light on habits including how to form good ones and how to break bad ones. The book by Pema Chodron is entitled Living Beautifully. I must admit that even though I’ve formed lots of good habits that have led to some very wonderful and rewarding successes in parts of my life, I’ve also had some bad habits that have hurt me, and it’s been so very frustrating for me to try to break or change the bad ones only to fail and fall back into them. But Pema’s book has some real answers and directions that, so far, seem to be a quite a breakthrough.

First of all, she outlines that part of the reason we have trouble breaking bad habits is because we are too hard on ourselves.  What most of us do when we end up doing something that we’ve tried to stop doing, is to get mad at ourselves, beating ourselves up mentally, then we try to repress our thinking and whatever we did that broke our promise to ourselves. She strongly suggests that instead, we come to recognize that we are fundamentally good rather than fundamentally flawed.

Probably Pema’s biggest lesson for us is a bit surprising. She suggests that if we are trying to break a bad habit, we need to think hard on refraining from doing what we promised ourselves but DON’T repress it. She goes on to say that many bad habits come from us trying to escape from uncertainty and fear in our lives in particular situations.  So when we are faced with the desire to fall into that bad habit, we need to examine our thinking to see what led us to that point and then just try to refrain from that action but not repress those thoughts.

Pema has science backing her up on this issue.  She says “Science is demonstrating that every time we refrain but don’t repress, new neural pathways open up in the brain. In not taking the old escape routes, we’re predisposing ourselves to a new way of seeing ourselves, a new way of relating to the mysteriously unpredictable world in which we live.” And in the process we are hard wiring our brain to do the right thing automatically.

What I learned from Pema is already working well on a couple bad habits that I’ve been trying to break for years and I am so pleased!! Try it yourself and you may well see what I mean and find success.

Real Estate Investing: The Advantages Never Change

Yesterday I was going through a bunch of old files and I came across a large envelope that my good friend Joe Sugarman sent me. Joe is the founder of the company that introduced the Blueblocker sunglasses that sold millions, making Joe a very, very rich man. In the package was a few of my old ads that Joe had kept.  On the old yellowed paper I re-read one of my first half page ads printed in the Wall Street Journal on January 25, 1977. The headline read “How to Achieve Total Financial Freedom”.  I am totally convinced that the reason the ad sold so many copies of my first book, How to Wake Up the Financial Genius Inside You, had less to do with the semi-catchy headline than the sub-header that read, “Millionaires Are Not 100 Times Smarter Than You, They Just Know The Wealth Formula”. I’m sure that most people read that and it rang true to them. Because it is true.

In the body of the ad I went on to say, “Millionaires are not 100 or even 10 times smarter than you , but it is a fact that millionaires are making 10 to 50 or even 100 times more than you.” Additionally, I should consider that millionaires are not working 100 or even 20 times harder or longer than you either. There are not enough hours in the day to work 20 times longer than your average worker! And now, 38 years later, I can clearly see that the formula to making big money and accumulating great wealth is basically the same today as it was way back then.

I can tell you for sure that if I were just starting out now as a young man without any money to speak of, just like I was years ago, I would pursue the same path as I did back then.  The only difference would be that I might be a little more aggressive today than I was then. Today’s market is ripe for the picking!  For the most part the only push back that I have had in recent years from readers of the Financial Genius book is that buying properties at the prices given in the book are just not possible in today’s market.  And those critics are absolutely correct, but the ratios are still pretty much the same.  In other words today you can’t find “dirt bag” properties for prices like $40,000 or $50,000 in most markets. And that’s correct.  But the ratios for what you can make on your investment are still the same.

In many cases, you can gain a 33% value increase on a dirt bag property you fix up. On a $50,000 property, that would be a little more than $66,000. But today, you may have to pay $120,000 or $200,000 dollars for a beat up property but after fixing it up, you could sell the $120,000 purchase for at least $159,000 and the $200,000 investment for $266,000 or more. Yes, these numbers don’t take into account the money you spent on fixing it up, but if you leveraged the deal with a mortgage–using someone else’s money to make money–you will find that the return on your investment goes up a ton and will usually more than make up for your fix up expenses.  So bottom line here is don’t get hung up on the lower price examples in the book, invest and pay attention to the percentages you can gain.

To help with that, I have recently updated my Financial Genius book. It will be going to the printer before too long and I will let you know here when it’s ready for ordering.

The Failing of Stock Market Investments: Human Nature

In last week’s blog I talked about the wild stock market moves and the huge sell off, which was followed quickly by a rebound of prices. Since then we’ve had another pull back of prices once again erasing some of the gains. Some people would point to the big spring back of prices and make the argument against my conclusion that for most people investing in ‘real estate’ is a much better place for their money.

It is true that, in most cases, the market does rebound and in the long run you can make some money there as long as you buy good growing companies. The key here, as Warren Buffett has preached for years, is to buy the right stocks and hold them for the very long term. The big problem, however, is most people don’t do that. Why? It seems to be connected to our human nature. You see, when many, if not most, people buy a stock and they see it gain, say 50%, they sell it because, as I heard hundreds of times when I was a stock broker, “Hey, you can’t go broke taking a profit!” But the thing is, that stock may end up being the next Microsoft or Apple Computer company, subsequently moving up another 50% or 100% or 1000% or more over time.

On the other side, there’s the typical part time stock investor who buys a stock at $20 only to watch it drop to $10 a share, says to themselves, “I am not going to take a loss on this so I won’t sell it now.” So they hold on and wait. Over time I think you can guess what will happen. Yep, those kind of investors end up with a portfolio full of crummy, terrible, loser stocks. They kept the ones that went down and sold the ones that went up.

A big part of the problem with stocks is anyone can quickly and easily buy or sell with very little effort and that can lead to impulsive decisions. Greed and fear can cause that quick buying and selling of stock reaction–usually not a good idea. However with income producing real estate, impulse buying or selling doesn’t usually happen since it all takes more time and, of course, more effort.

But because of that ‘time and effort’ factor, most people that buy income producing properties buy and hold for the long term and if they’ve done it even half right they are collecting enough income in rents to more than cover their expenses which gives them the great benefit of being able to wait–sometimes for a very long time–until they can sell the property for a sizable gain! That’s why I love real estate.  It is also what primarily got me to leave the stock business and move into the real estate investing business. I do hope if you are not already investing in real estate, you’ll start very soon.

A Case for Diversification

Wow! What a wild stock market we’ve had the last few days. Over a trillion dollars in lost value. Can you imagine having virtually all your asset held in stocks? I was asked the other night at a party, by a person that apparently was hurt pretty badly by this, how much money this huge sell off of stocks cost me. I answered that it had virtually no impact on my assets and or net worth. How is this possible? Well, it’s simple … I own just one small position in one publicly traded stock. Maybe in the long run the market drop will have an effect on real estate property values–that’s where I have almost all my net worth– but I very much doubt it.

Yes, I used to be a stock broker many, many years ago and would buy and sell stock for myself frequently, but I learned the hard way that even very smart people can lose money very quickly in the stock market. Even if you buy great stocks and those companies are making money and doing well, if the overall market takes a big hit like it has done the last few days, your good strong company stock usually goes down with the market. One of the big reasons I moved almost all my assets into improved, rent generating real estate is because I had a least some control over the asset that I owned. You see, with stocks, you not only don’t control the company or the people that are running the company, but you have no control over what the overall stock market is doing.

You may be thinking, “Okay, I agree with all that but putting my money in improved real estate takes a lot of work and effort.” And you would be correct. It does take work but the rewards can be so great and much of the work can be turned over to others. I’ve certainly found that to be true and the huge surprise and benefit to me was that I found people that do a better job finding, fixing and managing the properties than I do, or I should say “did”. I’m a big time delegator now.

At a minimum, I would encourage you and anyone that will listen to not put all your eggs in that one ‘stock basket’. Diversity is the smart thing to do and, yes, even though I own very little stock, I do make sure I diversify my asset by owning different kinds of real estate. I own everything from triple net lease buildings with national company tenants to development of storage units to small retail strip malls and even a bit of raw land. A bit of cash always being set aside is a good idea too.

I encourage you to take time to plan out your asset strategy. Don’t be like the majority of Americans who seem to spend a lot more time planning their vacation that they do planning the financial life!

 

 

Money vs. Love

Last weekend we had our yearly Haroldsen/Baird reunion at our home and, oh, what a feast we had! We stand and sit around telling family stories and retelling the classic and most choice stories of past get-togethers and trips. Yes, there was some great food too but when it came down to it, it really was more a feast of love and interaction. That reminded me of a very important idea that I’d like to remind all of you about too.

For years I’ve preached over and over about the basic and best formulas for going out in the world to get and keep lots of money and I think that’s very important. Succeeding in financial matters really can improve and lift your life and those loved ones around you.  But, never let that ‘money getting’ get in the way of love.

Recently I listened to an author who had just written a book about that huge mine disaster that trapped 33 miners for 69 days, back in 2010 in Chile. When those survivors finally escaped that pit of hell, what they said was very instructive for those who would listen and learn from their experience.  Did any of them think about their houses or their money while they hoped and waited to be rescued?  No, they did not.  Their minds and hearts were fixated on their loved ones … their wives, kids, parents and other people they loved. When our lives are on the line, most everyone realizes what the most important part of their existence is and money is quickly and easily pushed out of our heads by thoughts of those that we love and those that love us. But we don’t need to wait until something terrible happens to remember what really matters.

Back when I was giving seminars, I used to ask the audience, by a show of hands, how many people would like to make and have a net worth of one million dollars. Just about every hand in the audience went up.  I would follow the same line of question with higher numbers: Who would like 10 million and then 100 million dollars? About the same number of hands went shooting into the air.  Then I would ask the question with a bigger number but with a much bigger difference: How many people here would like to make and have a billion dollar net worth, but when you got to the top of that huge financial mountain you arrived there only to find out you didn’t have any friends or relatives that liked you, and certainly didn’t love you, and none of them wanted to be near where you were—you would be totally cut off? There was always a few hands that were raised, very few, but all of those that had their hands in the air were, well, teenagers.

I’m not saying that you shouldn’t set your goals high and go after your fortune and keep on building it bigger and bigger. I mean only that you should think about all the good you can do in the world with that fortune. Always, always, always remember that giving and receiving love is infinitely more important and lifts your soul and your happiness in life to a much higher level than any amount of money ever would. Then live your life giving focus to the things that really matter as well as your big financial goals.

The Advantage of Honest Answers

There are certain questions that most of us hear nearly everyday. They go something like:

• How are you doing?
• How are you feeling?
• How’s everything in your life these days?

And what is our usual response?

• I’m doing fine.
• Oh, I feel pretty good.
• Things are moving along.

The answers that you normally don’t hear are:

• Not too good today.
• Oh man, I am feeling very depressed.
• Things are not going well in my life right now.

In our polite society we usually don’t dump our problems on others, not even our relatives or close friends. In most situations, that’s a good and considerate thing.  But sometimes it might be a good for you and me to open up and tell the full truth, voice the negative or tough things that are going on in our lives and in our minds. Why? Because many times friends and relatives can be a big help.

It’s kind of strange that it’s perfectly acceptable in our society to tell someone that you have a cold but it’s a no-no to tell a friend you’re feeling down or depressed. Both conditions are real and there are treatments for both.

Recently, I met a longtime friend who said in the usual manner, “Hey Mark, how are you doing?”  Suddenly, and to my surprise, I found myself telling him the truth, saying “Man oh man … I’ve really been depressed lately.”

Next thing I knew I was quickly apologizing for dumping my personal problems on him. But to my surprise he was not taken aback by my honesty but rather told me in turn that he too gets down and depressed.  I was surprised to hear him say that because he always seems to be on top of the world and so very happy.

He then gave me some very good advice on things I could do to pull myself out of my slump and in a very short order I began to feel better.  The advice he gave me were things I already knew but had slowly stopped doing. Things like eating foods that improve your mood and taking supplements like 5HTP and Saint John’s Wort. And just as important as all the rest … pushing myself to stay busy and keep connected to friends and relatives.

I think because I am a healthy and very wealthy person, people look at me and think I am always upbeat and positive and never get depressed.  But, many times the problem is my advantages in life also make it difficult to feel motivated–I don’t have to work and I don’t have to do anything if I don’t want to. Even though that might seem to be a very good thing, it can be such a bad thing and can almost drive you crazy.

We all need to keep busy. We need to stay engaged and connected to friends and relatives. We also need challenges which mean constantly setting goals for ourselves and staying on track as we pursue those goals.  Yes, I am preaching an old subject to you but I am very definitely preaching to myself! Because we all need a little reminder now and then. And to get that, sometimes all it takes is giving a friendly question an honest answer.

Three More Buried Secrets

A secret is some bit of knowledge that is kept from someone or many someones. Last week I spotlighted those truly terrible secrets … the ones we hid from ourselves! When you are trying to accomplish something that is challenging or simply hard to stick to, you need every tool you can get your hands on. But so often, we have been given these tools and then hide them away. Why is that?

Well, if you read last week’s post, you now know (or have been reminded!) what some of the most important ‘secrets’ are to accomplishing both small and large goals. But wait … there’s more! Let’s take a look at some of the other great ‘secret’ tools you have available to you to make your dreams happen!

No. 5: Establish a routine and keep with it until your routine has truly become a hard and fast ‘habit’!

This is a big one. Form the right habits and you can change your life forever.  You know as well as I do that this is true whether the habit is a good one or a bad one.  Scientist have determined that it takes anywhere between 21 and 66 days to form a solid habit, depending on the person. You and I must stick with the routines that are leading us toward our goals long enough that they become rock solid routines.  If we do that, we’ll see that sticking to our plans and reaching our goals will become easier and easier.

No. 6:  Break down those big goals into what I like to call ‘bite-sized’ steps.  For most of us, and I know for me, if I don’t break it down into small goals or bite sized tasks, those big goals can break me down. Why? Because those big, long term goals can overwhelm the mind and shut a person down. It’s easier to do the small stuff and they eventually add up to something big!

No. 7: Set up a reward system for yourself. That is, when you hit your goal and maybe even along the way as you take those bite sized steps or reach intermediate points or milestones of success, take time to celebrate your victory. You can reward yourself with a special night out on the town or a huge getaway vacation to an exotic place. Whatever it is, make it super special and something that you will always remember.

That is a long list of ‘secrets’ you can use to help you reach your goals. But one last thought–If you don’t hit your goal or you miss a deadline, don’t be too hard on yourself.  Remember, some of the most successful people on the planet had many, many failures as they pursued their big goals.  It really is okay to fail–almost everybody does at some point or another. The thing is, failure can lead to even greater successes, so if you fail and fall down be sure to get right back up, reload and reset and keep going!

 

Big Buried Secrets

Ok … so do you want some sure-fire ways to help you set big goals (and/or small goals) and be able to stick with them until you succeed? Well, they are out there just waiting for you. I’m going call these methods ‘secrets’ although as you read some of these you may say ‘Hey, I already know that one!’ so for you it’s really not a secret.  Right?  Well, you may be right and it may not be something new to you but if you are not doing it, then maybe it really should be labelled a ‘secret’. A secret you are keeping from yourself.

For example, you probably have heard the first two secrets I have for you. But do you do them?

No. 1: You must write your goal down! There is a kind of magic that happens in our brains when we make a printed record of specifically what we want to accomplish. It makes it more real to us and we feel obliged to follow through. Just because they’re written down.

No. 2: Be sure to put a deadline or time limit on your goal and write that down too.  Without a deadline, you can put off forever the tasks that will move you forward and then you’ll never get close to that goal. Knowing you have a deadline gives you a kind of mini-goal and something to aim for.

Does that sound familiar? Sound like great advice? Yes? Well … do you always employ them?

How about ‘secrets’ that some people might be aware of but don’t spend enough time doing?

No. 3: Take time to carefully visualize your goal with as much detail as you can imagine.  That visualization should also include an image in your mind of actually accomplishing your goal. Think about how you are going to feel when you arrive at your journey’s end. Run it though your brain numerous times until it feels real.

No. 4: Tell other people about what you have set out to do.  Ideally tell people who care about you and understand and appreciate what you’re aiming for. Ask these people to remind you, encourage you and cheer you on as you make progress towards your goals.

This fourth step can be a huge help.  Even if they don’t ask how you are doing or give words of encouragement every time they see you, your seeing them will often remind you that they know what you are shooting for and you certainly don’t want to disappoint them, not to mention failing yourself, of course.

So I am guessing that, for a lot of you, these tips aren’t new ideas but if you aren’t doing them, they might as well be deeply buried secrets. They are all simple to do, take very little effort, and can increase your ability to persevere and reach those goals, both big and small! So dig these back up and use them! It’s your own little gold mine you can use to pave your way to all kinds of success.

There is even more good news … those are not the only ‘secrets’ out there. Next week, I will talk about more tried and true secrets to making your goals a reality. Get yourself a head start by writing down, setting a deadline for, visualizing and telling others about your goal. Because the biggest secret is that you can’t get what you want without going for it!

 

 

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