Coach Mitch’s REFLECTIONS™
In every subject, business or endeavor, there are varying levels of information, levels of expertise, levels of creativity, and levels of accomplishment. I will loosely label them as Good, Better and Best. I will explain why I think that tax lien and tax deed investing is the BEST of the BEST!
When it comes to creating a life, i.e. doing something that will make you financially independent, there are various ideas and paths to take.
You can follow the GOOD time tested idea of getting an education, getting a job, working hard and getting promoted.
Getting a J.O.B. is fine; a job creates a level of security and it allows for gaining expertise. You will quickly know if you are going to be one of the few who are actually promoted up the corporate ladder to a point where your future is secure from downsizing and your income is sufficient to achieve some level of your dreams.
If you want to do BETTER, then you can educate yourself in some sort of business that you can become the owner of. This can be something that is “a great idea,” or “the coming thing.” It can be a business that needs the better management that you can supply. The business can be as simple as having a hobby and figuring out how to make your hobby into a business. The idea is that it is always better to be in business for yourself. This is the path to the American Dream! And the best dream is to be in a business doing something that you truly enjoy, so that each morning you can’t wait to go to work.
The BEST path, IMHO, is a business in which you have control over the aspects that impact the business. In other words, you control as many of the things that influence your business as can be controlled. Where you do not have direct control, then the next best is to have access to the information so that you can make the right decisions that affect your business.
If you don’t have control or don’t have the data, it is just a matter of time until you lose.
Example: I lost all my investment capital in the stock market because of an investment in IBM! IBM did something unpredictable, but good for IBM. However, IBM’s corporate board did not ask my opinion if they should pay off a big loan ahead of schedule. Further, they didn’t share the idea before implementing it. I, and everyone else, lost our shirts when the anticipated high divided was reduced because we had bet that the dividend would go up. Paying off the loan was good for IBM, but bad for many investors. We could have prepared if IBM had given notice, but they didn’t, and there was no way to find out without breaking the law to gather inside information.
Therefore, a crucial aspect of business is knowing what will impact your business and having the ability to gain access to the data to make an informed decision. If you can’t get the good information, then you can’t prepare adequately. Eventually you will fall prey to some condition that you did not know about, and is beyond your control to correct.
Passive income versus Active income
Many Americans, especially those with some investment capital, prefer to invest in stocks. Stocks hold an attraction because investors do not think of it as a business. These armchair financiers want to do something easy, passive, like just sit back and look into the newspaper each day to see how their investment has done.
However, stock investors have no input into any decision the business makes. Investors must hope that the managers know what they are doing. If the managers misstep, the investment goes down. It is interesting that, in any given day, you will be able find “experts” predicting what the stock market will do. Of course, some say it will go up and some say it will go down, and they are both correct. Interestingly, they look at the same data and come to exactly opposite opinions. One can go to the horse races, bet on horses and achieve the same results as betting on stocks. If one were to invest one million dollars, each year, without losses, after costs and after taxes, on average, you will make about $50,000. It hardly seems worth it. Do you have one million dollars? How will you accumulate that much to invest into the stock market?
If you want control, if you want to dictate the direction of your life, then you need to be an active investor. This is someone who takes their business seriously, understands the business, is active in the business, and makes decisions. Good or bad, up or down, it is your decision.
What to do?
Of the many types of businesses that are available, I like REI, Real Estate Investing. I believe that investing in real estate comes naturally to most. Because we all live in some form of real estate, we have an innate understanding of housing.
Real estate has a very large amount of public data related to it. The Census Bureau has almost more data than you can consume letting you know about demographics, incomes, crime, etc. The Departments of Transportation will tell where future roads will go and Planning Boards show the Path of Progress, i.e. where future building growth is headed. The Assessor knows about the values of all property in the area and the Building Codes Department and Tax Collector have other valuable data, all publicly available.
Banks are ever ready with various programs to fund real estate transactions. Private money is very available to jump in if a bank is too slow or too demanding. It is well known in real estate investing circles that if you find a good deal, the money will appear.
Learning about real estate investing is surprisingly easy. There are many free courses on You Tube and the internet, just Google real estate investing courses. There are real estate investing associations all around the country and they welcome “newbies.” I ran one such association for 10 years. It was a wonderful experience.
What I did
The first thing I did was to read everything in the club library. These days there are many video courses. Then I introduced myself to each of the members of the board of directors and asked how I could be of service. Before I knew it, I was recruited onto the board myself, then became President.
I took active investors to lunch to bleed their brains and asked if I could accompany them when they went to see a property? I asked them to come along to help me look at property, so I wouldn’t make any mistake.
After careful investigation, I chose a strategy. I telephoned 700 people and mailed 200 expired listings. At call number 14 I found a seriously hurting homeowner. After telling me her tale of woe, the owner asked, “Mr. Goldstein, could you just take the property? I don’t want any profit?” A net profit of $35,000 was made on that transaction. In 1985 that was real money. In today’s dollars that would be over $77,000.
One only needs a bit of imagination and to be diligent in research in order to determine a game plan that has every potential of success.
Tax Liens and Tax Deeds
That led me to further investing in real estate. I tried most every real estate investing technique. Eventually I discovered tax delinquent property. This is the most exciting area of real estate investing that I have found because of the consistency with which one can find sellers who are desperate to sell, in fact, “the tax delinquent is the most motivated of all motivated sellers.” ©
Best, is that there are public data bases which have thousands, and in some counties, tens of thousands of “ready and willing sellers” © all around the country and in the possession’s. You can literally, sit at your kitchen table and roam the world on your computer and find situations that are amenable to your type of property.
You are seeking situations where you can help someone out of a circumstance that is beyond their control. Being a knowledgeable real estate investor, you will have figured a way out for these folks, but only if you can make a profit. Your investment could be as little as $1. That is the essence of Coach Mitch’s “Ridiculously Simple System…”⁜
The BEST of the BEST = Tax Lien and Tax Deed Investing
Tax lien and tax deed investing is a business that you can control, with information that is readily available, sellers who are often desperate to get out of the situation that they are in, and for the low investment cost of $1. It doesn’t get better. What are you waiting for?
BTW, the average first time profit of a Coach Mitch student is well over $20,000.
With such a large profit that is created with such a small investment, $1, tax lien and tax deed investing is open to everyone, including those with a J.O.B. Do investing as a part-time J.O.B. while you accumulate expertise and profits until you have enough to make the leap to full time status. In this way you can go from Just Over Broke to Financial Freedom.
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