There was a time I would have told you I was afraid of investing in anything. I was afraid of investing in the stock market, real estate, and if I’m being honest…even in myself. As I have come to middle-age and have taken stock of my life, I have realized a few important lessons with respect to investing:
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- We have been taught to be consumers, not investors
- Everyone is afraid of doing something new
- Money or the perfect deal will never fully take away your fear
Consumer vs Investor
The major difference between consumers and investors is not how much money they spend. It has more to do with what they spend their money on.
As consumers, we buy things that give us immediate pleasure. We are taught to buy goods and services that are advertised to us via television, the web, or any other medium. This could be a nice meal, a new electronic gadget or something for the home.
As investors, we should invest in things, ideas, and relationships that give us multiple returns at some future time.This can be real estate or stocks and bonds.
Many of us have been programmed from youth to see finance through the lens of a consumer. We are taught to consume, not invest. Once we change that mindset, we can truly see the value in planting seeds for a greater harvest later on.
Everyone is Afraid
A quick search of “biggest real estate investing fears,” will always bring up some version of these stressors:
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- Not enough money
- Being a landlord
- Finding the perfect deal
- Lack of experience
- Getting started
What these anxieties boil down to is Fear of Failure and the very real consequences that can happen when we fail (especially when talking about large sums of money).
Many that have lived any length of time or had the audacity to try something new, know this truth very well…
Life is not fair.
There are many reasons for this. There have been countless books written on the subject in any number of languages with just as many viewpoints. We can either let those viewpoints keep us from moving forward or we can battle through the fears, whatever they may be, and continue our journey.
Money & the Perfect Deal Don’t Take Away Fear
As someone with moderate success in my W2 job, my wife and I have been able to save some money…no different than many of the people reading this now. As I started my journey, I found some good deals that I made bad because I didn’t want to overpay.
I had the money…the deal…I still failed…but the point is, I tried. I learned from that mistake and I haven’t made it again.
Fears are real and they can keep us from doing many things. Don’t let your fears keep you from something that some people don’t want you to have:
Time with your family
Options for your future
Independence
Part of my fear with investing in real estate was failing. Through the sacrifices made by my family and others, there was a safety net created around me. They gave me something important. The ability to try. I could either lean into that safety net and invest in generations to come, or leave things the way they were and not think about the outcome.
If you are reading this, you are at least mildly interested in real estate investing. From a First Generation Investor who has had all of the fears listed above (and many others), I invite you to join us on a journey of education and action.
I will write one day about the trials my family faced when they arrived in the U.S. However, this article is about you, the First Generation Investor who has not realized the power of where we stand in history. From the comfort of our homes, we can unlock powerful vehicles that were previously only available to the mega-wealthy.
While the internet has many scary things, one the beautiful things is that you can pretty easily create a sense of community. Our company was born out of the idea that there are a lot of people like me, someone who just needs people to trust. Our goal at First Gen Investors is to Educate, Grow, and Give.
Educate
We’ll do some writing, podcasting, You-tubing (Is that even a word), Instagramming (see you-tubing), and other material catered to the First Gen Investor.
Grow
By equipping the First Gen Investor to make more informed decisions, they can grow their hard work back into the thing we crave the most…time.
Give
We believe in the power of giving. Whether to your friends, family, charities or complete strangers, your investments should be an avenue for you to do what you deem best with the growth we can help you accomplish.
Our focus is the First Gen Investor.
Let’s shake off the fear and start creating some action in our investment journey together. At First Gen Foundations, we look forward to hearing from you and exploring topics that scare, inspire and even confuse you. We want to serve you and people like you who might be scared, but in spite of that, move in the fear, and are not frozen by it.
Bryan Escudero
President and Co-Founder, First Gen Foundations
Proud to be a First Gen Investor
Great article. Fear is a huge factor. Being afraid to fail and loose what we have worked so hard to save.
The fear of starting to invest after age 45 and taking a loan against the primary home and still having a payment in the latter years of life is real.
But I look forward to continuing to gain knowledge have a company that provides support and answer even the smallest of questions..
What do you recommend when it comes to using all ones savings vs. taking a loan out against your primary? This question, I continue to ponder with daily.
I think it is important to recognize the HUGE step that you have taken to get in the game. The act of investing is scary. The goal of being a First Gen Investor is to build a foundation. One of the things that we do discuss is that, yes, your home is your biggest asset, but remember this. The day you stop paying your mortgage, you lose all of the equity you have worked so hard to build. Your primary home IS your biggest asset, but it is also your BIGGEST LIABILITY. I would not jump in hastily into any investment. I would recommend understanding what you can truly support in a HELOC (even having reserves for debt service).
As for all of savings, I would want to make sure that I always have a rainy day fund in cash. I have heard people talk about sleep at night money. There is a number that helps people sleep at night. For most, it is between 3-6 months of expenses. Others take that out longer. A lot of it has to do with your employment prospects. Are you in a secure job. Do expect your prospects to change much in the near future. It is important to understand that there is an opportunity cost to leaving money in the bank when you can do better in the real estate market (not to mention inflation).
All of that is fine and dandy, but you need to be able to sleep at night. Happy to jump on a call to talk about it a bit more, but do want to commend you for getting involved!