Many people opt not to take their first step in investing because they feel they lack the expertise or experience. But when we let perfection get in the way of progress when it comes to investing, there is a high opportunity cost. Do you really need to be a finance expert to invest in real estate? I say no.
I became a landlord in 2009 after buying a 2-bedroom home in Denver and recruiting my longtime roommate to live there with me (and pay me rent). I had no idea this would eventually (14 years later) lead me down a path of opportunities to buy more rentals, scale a multifamily portfolio, invest in various syndications, and have a business that produces enough income to sustain my family.
I had graduated college two years before I began my home search. I didn't realize the full benefits of real estate, but I did associate homeownership with financial security, and I wanted to set down some roots in Denver. I had a modest savings, a buyer's market, and a first-time homebuyer's tax credit to take advantage of. It took about seven months, but I finally found a place I could afford in a location I liked, and I lived there for four years before turning it into a rental.
My biggest takeaway from this story is that I didn’t study finance or have any prior knowledge in the market, or real estate investing. I made one informed decision at a time. It was a slow journey with evolving goals, and I learned a lot as I went. I could have done most things better, but if that awareness had kept me from buying my first home, then keeping it as a rental four years later when I moved, I don't think I would have achieved financial independence when I did.
I recently spoke about this story on the How Did They Do It podcast and I hope it can inspire others to get over the hurdle that they can’t start investing because they don’t have enough experience or expertise. Find your next small step and take it!
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