Your Roadmap to Wealth
Property investors who take a professional approach, understand that the success of their property investment business depends on a well considered and thorough business plan.
Understanding the power of property to create true financial independence and wealth fills many prospective property investors with such excitement, however, that they jump right in and buy a property without first planning their strategy. This exposes them to potential problems.
Other prospective property investors may be more conservative, and their fear of making a mistake leaves them unsure of how or where to start. This exposes them to what is potentially the biggest risk: not starting at all. In either case, the solution is simple: take a professional approach and have a well considered and thorough business plan.
Foundation First
The importance of a formal business plan, and the results it produces, was recently highlighted by a study undertaken by the University of Oregon in the United States. The study revealed that businesses with documented business plans were almost twice as successful in achieving their business objectives.
The reason why a business plan effectively doubles the chances of business success is twofold. Firstly, it provides direction. Clarifying your goal or destination ensures the efficient allocation of resources; makes it possible to identify priorities; and ensures effective, focussed decision making. Secondly, a business plan requires you to map the steps in terms of how you will achieve the goal. It demands a realistic look at where you are and a common sense strategy for getting to where you want to be, one step at a time. It also identifies and addresses potential obstacles and challenges that may crop up along the way. Many people are surprised to find that when they break down their goals and objectives into smaller steps, even the most ambitious plans can be achieved realistically.
Benefits of a Roadmap
Property investors often benefit from joining an investment club. Members enjoy the help of experienced portfolio managers, who will take time to understand their unique financial situations, assist them to clarify where they want to be, and help plot the smaller action steps that will take them there. A business plan is not a vague “get-rich-quick” plan. It should be structured to help you understand your current financial position and your primary and secondary financial goals for the future, with realistic deadlines.
Story by Koos du Toit (First Published in REIM: http://www.realestateinvestormag.co.za/)
