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To reach the top of the real estate investing mountain, you need to use all the tools available in your financial tool belt. While you can theoretically build a house with only a few tools, the quality of the house can suffer if you don’t have certain tools. The same is true when you are trying to finance your real estate transaction.
First, an important truth in real estate: You don’t need a sterling credit record or access to a ton of cash to make a fortune as a real estate investor. But you’ll get to the promised land of real estate investing much faster if you do.
Because your ultimate goal is to build a chubby real estate portfolio, and a sizable residual monthly income that comes in regardless of whether you decide to get out of bed every morning or you choose to sleep in, you Would like to make sure that your finances are in the optimum state of health. This requires you to do a thorough examination of your finances, just as your personal physician would do to ensure that you are the picture of good health.
Step One: Get in the Right Frame of Mind
The most important step in analyzing your financial situation is realizing that the way you make money and financial decisions plays a huge role in your ultimate success or failure. If you have a proven track record of shooting yourself in the foot with bad financial decisions, it’s imperative that you do a radical about-face and change your spending habits.
If you waste a ton of money on music downloads, splurge on overpriced gourmet coffee every day, or you’re on a first-name basis with the Walmart greeter, I have news for you: In your budget A congressional spending bill is more pork than this. By cutting a lot of waste out of your personal economy, you can generate cash out of thin air that you can use for better purposes rather than immediate gratification. Instead, you can change your life for the better. But the choice is yours to make.
Step Two: Cut Expenses Steadily
When you pay bills at the end of the month, do you usually have cash left over, or do you spend everything within a day or two of payday – and then pay when your next paycheck arrives? rest till? Most people spend a major portion of their paycheck on bills, food, and other necessities. If they’re lucky, they can set aside a few dollars for a rainy day. The difference between people who have control over their finances and those whose financial lives are in disarray is that control involves having control and being in control. While many people have trouble increasing their income, it is possible to reduce expenses. To do this, you need to get a handle on your expenses and identify areas of your budget that can be reduced. While it’s not the sexiest topic of conversation, it is absolutely vital to your ultimate success as a real estate investor. Budgeting for monthly expenses and only spending what’s on your list is one of the most difficult aspects of taking control of your financial life. By cutting out unnecessary expenses, you’ll reach your goals more quickly. Here are a few ideas to get you started:
Cable Pig Gut: This is correct; Cancel your cable. You’re constantly complaining that nothing is good enough anyway, aren’t you? Instead, talk to your spouse, take a walk, listen to a podcast, or read a good investing book.
Downsize your cell phone plan: Most people get loaded up on expensive and extravagant cell phone package deals. Unlimited texting, mobile web, and massive calling plans are great, but most people don’t use all of their phone’s features. Do you need mobile browsing, or is it just a toy you use to watch YouTube videos while you should be doing something else? Do you need unlimited texting, or can you rest your thumb if it will save you $20 a month?
View your credit card statement: See if you have any recurring charges each month. Are those items what you need? You may also have some small fees each month that you forgot to sign up for. Eliminate unnecessary ones and keep track of them to make sure you’re not throwing money out the window.
Stay out of the drive-thru—your waistline and your wallet will thank you. These often-daily trips to McDonald’s and other fast food joints are killing your health and your budget, sometimes up to $5-$10 per trip. This goes for coffee as well. Caribou and Starbucks are tempting, but do you really need to stop for a $5 cup of coffee every day, or would you rather save money making some at home?
Step Three: Pay Off Excessive Debt
Another area that may be holding you back is excessive debt. High credit card balances, store charge card balances and computer payments are a fact of life for millions of us. However, if they’re holding you back financially, they need to go the way of 8-track tape and join the growing list of things that once served a useful purpose and no longer do. Make extra payments, hold a yard sale, or do whatever it takes to eliminate the excessive debt. If you can’t find the cash to pay off some of these accounts, consolidate them, or at least make larger payments. If the credit cards in your wallet are consuming too much of your cash, it’s time to take control and protect your financial interests. no one else will do.
Step Four: Check Your Credit Report and Score
How is your credit history? Do you have a long track record of consistently paying your bills on time or do you pay your bills late, if at all? If you’re like most people, your on-time bill payment record is somewhere in the middle. The first step in making this determination is to check your credit report and find out what your credit score is. Once you know those details, you can work to improve your credit and position your finances to take advantage of real estate opportunities when they present themselves to you. . The good news is that you don’t have to spend a small fortune to get your credit report. The federal government, for once, finally had a pro-consumer view that makes sense. The three major credit reporting agencies, Experian, TransUnion and Equifax, have teamed up on a single website. www.annualcreditreport.com With which you can get your credit report once a year for free. Whether you get all three at the same time, or you separate them so you get a different checkup every four months is your choice. The important thing is that you get these reports and see what information they contain. On them will be most of your credit transactions, along with your current balance plus any charge-offs, late payments, etc. If you find that your report contains errors, omissions, or fraudulent accounts (accounts listed in your name that were opened by someone other than you), there is a mechanism in place to correct these entries. Because your ability to borrow money, and the interest rate you’ll pay, depends on the accuracy of these reports, it’s in your best interest to make sure the story on your credit report is true. While you may not get a free credit score with your free credit report, it is still important that you have an accurate understanding of your current credit score as part of a comprehensive examination of your finances. You are much more than a number, but to a potential lender, numbers matter. If your FICO score is too low, your chances of getting approved for a loan decrease. This knowledge will allow you to act decisively to improve your credit score, and the rates and terms you can demand in all your financial transactions.
Step Five: Increase Your Income
You have two options for increasing your income: work harder at your job or find an entrepreneurial opportunity that can put you on the path to financial success. Real estate investing is a proven way to build wealth, residual monthly income and life-changing opportunities.
Pine Financial Group’s goal is to continue providing you with the tools you can use in your life today to increase your income and build real, sustainable wealth. What you do with this knowledge is up to you.
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