Now, this is the ultimate question that many potential real estate investors find themselves question. Should you quit your full-time job to be a real estate investor? Many entrepreneur-minded people have this dream, and are very passionate about the idea. And, every day your boss yells at you, the dream only gets larger and larger in your eyes. However, there is a specific time that you should leave your job and it’s usually not on an impulsive fantasy of becoming an overnight real estate success. There are some very important facts you should consider before you decide to tell your boss “I quit.”
Usually “Should I quit my job for for real estate?” is asked by the type of person that simply hates their job. They think real estate would be a great meal-ticket, but they don’t realize the level of commitment it’s going to require; and they’re not quite willing to put in that kind of work, though in their head they think they will. Usually this impulsive decision is driven by the notion of making tons of money, fast. Real estate is not a business that offers instant gratification. You should be aware of that ahead of time. Maybe you’re having to move back home because you just aren’t making any money. Usually, it is when you are sitting at the dinner table with your parents shoving food around your plate and you begin to say, “I think I’ll do real estate.”
If you’re asking yourself if you should quit your day job to become a full-time real estate investor, the answer is no. When you’re young, it’s easy to be especially stubborn. Especially if someone tells you they don’t think you can do it. The smart path is to keep your day job, and learn real estate on the side. Don’t ever fully quit your job for real estate. Pay close attention to the following advice. Just about everyone that has quit their real job for real estate has regretted it.
Be grateful you have a steady job
Having a job is incredible; if you have one, you should be fortunate for it. This means that you’ve got money coming in. Most people don’t like their jobs; this is a fact. Hating your job does not mean you should give everything up to do real estate. Theoretically, it seems like a great plan…but it’s one that you should not put into action.
Before you quit your job, make sure that you’re making at least the same amount of money as an actual employee at that company than if you would if you were a successful real estate investor. One of the reasons for this is (obviously money), but more importantly, it forces you to practice patience.
Patience can be difficult. You also want to make sure you’ve got an even balance. On the one hand if you’re too, too patient, you’ll never accomplish anything. However, in real estate, patience is a virtue. There is no immediate gratification in real estate. Deals take a long time to close. Sometimes one to three months, sometimes more. If you’re completely broke, you’re not going to even be able to make the rent.
If you are able to throw a deal or two together, you’ll be desperate and may even be forced to basically “give” the property away out of pure desperation. If you’ve got money in the bank, you won’t be so fast or desperate to give your properties away for nothing, or for a measly break-even profit. You cannot be completely broke when starting out in real estate. You have got to have the money to withstand all the highs and the lows, because they’re coming. If you don’t have the patience to do that, things are going to go very, very wrong for you in this business…and fast.
What happens when the buyers agent hands you over a nice, long repair request list that they want completed before they’ll purchase it? Instead of negotiating a deal, you’ll be in a position where you’ve got to sell it no matter what. Without the power to negotiate, you’ll lose every time. You never want to be in a situation where you’re relying on the properties you currently have to make a living. Negotiation is power in real estate; if you don’t have that, you’ve got next to nothing.
Keeping your job helps you learn to withstand
Many people in real estate give up. You’ve got to stick with it long enough to reap the rewards. It takes a while to get any business going, especially if you’re in it for the long run. You’ve got to have both patience, and the ability to continue when things are looking down. Don’t give up! Practice being sustainable. If you don’t, you aren’t going to make it. Therefore, if you’ve got a job right now…thank the lucky stars.
Being a boss isn’t all it can be cracked up to be
When you work for somebody else, you have the straight luxury of going to work in the morning, working, then going home to do what you please. Yeah, your boss might get on your nerves, and the sound of your coworker’s voice might drive you bonkers. But at the end of the day, you get to leave. You get to go home. When you’re the boss, you have to worry about the business; you have to worry about your employees job’s, and the future of the company. You’ve got a totally different set of responsibilities, and they’re a much bigger burden. If you mess up, you’ve got people’s lives on your hands. If you make bad decisions or don’t do your job, they’ll have to find a new one. What will they do in the mean time? Being a boss can be emotionally stressful.
It’s a responsibility. You’ve got to make sure people always have things to do, that the business is running smoothly, and that you’re constantly learning for new ways to innovate. When you’re an employee (yes it has it’s challenges), you don’t have the responsibility of putting people’s children through school.
Why should you care about all of this?
So why should this be important to you? It’s important because it means that you can do real estate part time. There’s no doubt about that. Many people assume this isn’t the case, but think about it. When are sellers typically home? In the evening. They go to work. And as do you. What about the buyers? They 9 times out of 10 want to view homes on the weekends, not during the weekday. Real estate is a perfect side-job. There is absolutely no reason to quit your current job for real estate. What’s so amazing about real estate as a side job is that you’ve got money coming in from a steady paycheck, so you can make better decisions as an investor. You have the power and patience to walk away from a deal. You’ll also have the money to put toward an education in the business.
Doing deals out of desperation
By quitting your day job, you’re putting yourself in a position where you either have to close the deal you’ve got, or literally have nowhere to live. The mental state that this puts you in can destroy your business. You can’t think critically about the deal because you’re too desperate. That desperation is also obvious to the seller. You don’t have the mindset that creativity requires because you’re too batty from wondering what you’re going to do if this falls apart. When you have a day job, that instinct to close a deal “or else” is much smaller. You know it might kick you a little bit if the deal falls South, but you know you’ll be able to come up with a different way.
What if you don’t have a job at all right now? And you’re thinking about how you don’t like working for someone else and that you might just go to school and get your real estate license. Well, if this is your plan, you’re in for a rude awakening.
Learn to manage your time effectively
One of peoples favorite arguments about quitting their day job for real estate is that they won’t have enough time for both jobs. The real problem is not your day job. If you don’t have the time to do real estate on the side, you have a problem managing your time. Time management is extremely important.
If you really feel that you aren’t able to get real estate deals done on the side while you’ve got a job, a family, and many other commitments, you aren’t going to do well when you’re full-time either. Why? Because your problem isn’t your commitments, it’s managing them. You’ll find a different excuse when you quit your current job. You’ll waste time making business cards, perfecting your website, or Twitter, or something of that useless nature. All of those little details that you “don’t have time for” are things that aren’t going to affect your income anyway.
Do not use the excuse that you don’t have the time. Honestly, learning time management is part of your education. Perhaps you only have specific hours to dedicate to real estate during the week and on the weekends. Having time constraints actually helps your brain learn to be more efficient, and more productive.
How to learn to manage your time
Getting Things Done is a fantastic book that you can use as a tool to help you do this. It’s by David Allen. Time management is not necessarily something you’re born with. Just like learning to delegate, as mentioned earlier. If you do not have enough time in a day to get everything done, you are not managing your time properly.
If you read that book, you’ll find that you have the time to accomplish everything you need to get done on any given day, and still have time to spend with your friends and family. And it’s not a one-reader. You should use it all the time to double-check yourself and make sure you’re still on top. Don’t ever lie to yourself by saying you won’t be able to succeed in real estate unless you quit your day job. That’s an excuse. If you are lucky enough to have a full-time job, be grateful and happy. Never complain about having a job.
Having a job is a complete blessing. Treat it as such.
If you want to get into real estate full-time, you will have to be consistent. Here’s the good news. If you don’t stay with it, it probably wasn’t meant to be anyway. Why? Because if you weren’t able to sustain the business for a few months, you wouldn’t have been able to do it for 25 years. It doesn’t mean you’ve failed, it just means it wasn’t your calling. That’s the amazing thing about keeping your day job. If you realize you don’t like real estate, or you don’t want to deal with the mental roller coaster of the ups and downs, you can close your laptop and go back to work the next day. Get your feet wet! See if you like it! You may decide that it’s not for you. And if you decide it isn’t, you’ve still got a roof over your head.
Also, never stay in real estate because you feel the need to “prove” something to other people. If you tried it and it didn’t work out, that’s fine! You don’t need to push yourself to be great at something that you know you don’t really want to do. It’s okay to change your mind. In conclusion, be sure to keep your day job. Try your hand at learning and practicing real estate before and after work. Practice managing your time. Educate yourself. Develop skill sets. Real estate is learned. It will take time to master it, so don’t get discouraged if things don’t speed up right away.