Fear – the emotional barrier to your wealthy future in property
Fear. It’s the one emotion guaranteed to kick your property investment plans into touch. Fear will stop you making the choices you need to make. As Franklin D. Roosevelt said, “The only thing we have to fear is fear itself.”
In this article, I’ll look at why you need to overcome the fear of failure, and what could happen if you do so and invest in property.
Are you prepared for retirement?
Debt is crippling People's retirement plans. Governments are so overburdened with debt that state pensions are being cut in real terms, and retirement ages are being kicked into the distance. The pension time bomb is ticking, and it’s easy to imagine a whole generation completely underfunded and living in poverty in their retired years.
For many seeking to plan for an above-average lifestyle in their golden years, property investment is proving better than stocks for retirement:
- You have greater control over your investment portfolio
- You benefit from inflation-proofed monthly income
- There’s no second-guessing the market when it comes to working out your monthly income
- Property assets have been an incredible hedge against inflation
- Investing in property lets, you decide when to retire
It’s all so different now
There was a time when most people considered themselves successful if they retired with their own home and no mortgage. This dynamic began to change in the 1980s:
- During the last three decades, governments have continually overspent
- They have racked up huge national debts
- Populations are growing older
- Stock market returns have failed to live up to expectations
- Now, with interest rates having been at or near zero for years, pension pots buy lower income than ever before
To avoid the pension time bomb, you must act now.
Fear stops you unlocking the door to a wealthier future
People don’t have to look forward to a poor retirement. But most will, because of fear. The fear of getting things wrong. It leads to procrastination. Mostly, people make excuses to take no action and only realise the situation they have created for themselves when it is too late. They then look for quick overnight gains and end up losing nine times out of ten.
I was the same when I first started out. I was terrified of making a poor investment. So terrified that I did nothing for five years. I was scared of making the wrong move, nervous of the property market, and, despite advice from various mentors, I kept moving that first purchase further into the future.
The trick when making mistakes is to learn from them
When I did finally take the plunge, the first few years proved to be a rocky experience. My natural pig-headedness tended to get the better of me. I ignored a lot of great advice from mentors, believing that I knew best. So, I made a bunch of mistakes in those early days.
From those mistakes, though, I learned a lot of lessons that I’ve since used to make sure of successful investing going forward. For a start, I learned how successful investors do things a little differently. Instead of doing everything themselves, the best investors pay professionals to help them. It frees up the investor’s time to do more important things: be a better spouse, parent, friend, sibling, or contribute more to the community, for example.
Success in property lets you make choices
Many investors believe that success is measured in money. I don’t hold with this. Success is measured in time. The money you make from property gives you the time to do what you want to do. Like I’ve always maintained, property is a lifestyle investment.
It, in fact, is the foundation of my philosophy as a Set and Forget property investor. It’s a philosophical standpoint that turns traditional investment thinking on its head. Successful investing is not about possession, but about choices. (Of course, the possessions are also nice to have!)
The Set and Forget philosophy is now at the heart of my investments and my life. And I’m far wealthier because of it.
To be a successful investor, you must first overcome fear
Experienced and successful investors have learned how to recognise and control the emotional side of investing. As you gain experience, you, too, will become a more educated property investor. You’ll learn that the traditional learning about wealth, property investment, risk and freedom is mostly wrong and usually misguided.
The first step to overcome in any new venture is the fear of failure. You must learn to put emotions to one side. If you don’t, and you allow emotions to control your attitude to investment, you will always struggle. You’ll arrive at retirement poor – if you ever get to retire.
You don’t have to lock your money away to be wealthy in retirement
Several years ago, a couple came to speak with me about their plans for retirement. They were in what many would consider being a great position. They had paid off their home and were debt free.
They both had jobs, but neither were in what you’d call a highly-paid position. They were both basic rate taxpayers. Despite having no debt, they had no pension savings. They wanted to enjoy life while they could, but also build some wealth for their retirement.
They had consulted with a financial advisor, who had advised them to lock away all their spare cash into a pension scheme. It would be tax efficient and might give them a meagre income in retirement. But it wouldn’t allow them to have the lifestyle they wanted now and didn’t promise the kind of retirement income they desired. They wanted to spend their retirement years travelling and seeing the world.
Using other people’s money to invest
We were able to create a property investment strategy that would help them get to where they wanted to be in retirement. But it needed a change of mindset. They had to take a risk. That risk was to use equity from their home to invest. It was a concept alien to them.
They had spent years being frugal to get to a point where they had no debt. They felt comfortable. Other people told them they would be mad to borrow to invest. Three times we found the perfect property investment opportunity for them, only for them to pull out. What was stopping them from signing? Fear. Fear that they were paying too much. Fear that the property wouldn’t rent. Fear that property prices would fall.
Their real problem was that they were scared to move out of their comfort zone. But it was a comfort zone that would leave them uncomfortable in retirement, unable to live the life they had worked for. Their fear of debt was clouding their vision.
I asked them what their future might be like if they didn’t act. They admitted that it would probably be difficult to retire comfortably. Their travel plans would have to take a back seat. Eventually, they’d run out of time.
I spoke to them about the 3+1 plan, and together we created a plan that would give them a great chance of retiring with the inflation-proofed income they desired – while still being able to enjoy life in the present. They started small, with a single modest buy-to-let property. It enabled them to learn about property investment in a controlled way, and realise that using other people’s money creates wealth.
They soon got the property investment bug. They didn’t stop at three properties. They now own 11 properties and are looking to add to their portfolio in 2018. Their fear of investment is gone. And they’ve already started to see the world. This year they plan to visit Machu Picchu and take their grandchildren to Disneyland. They are building their future while living for today.
To discuss your plans for retirement, and discover how property investment could be your route to your desired lifestyle today and in the future, get in touch with Gladfish on +44 207 923 6100. We want you to be successful in property investment, and enjoy the cash flow and profits that we’ve helped hundreds achieve to date.