Finance Marketing Business

With many Americans now realizing they can’t depend on the government to take care of them in old age, investors are now turning to face the hard reality that it’s time to take care of their own financial futures.

Of course, there are always those who want to build wealth and amass a fortune, just so they can say they’ve done it. However, many more of today’s beginning real estate investors are looking for something more tangible – they want to know they and their families will be taken care of – and able to live at the standard to which they have become accustomed, even after they have stopped working for a paycheck.

Stock market investing has historically been an excellent place to invest money. With its annual average of 11% returns since the crash in 1929, the long term compounding effect on your money can be huge! This is the type of return you need to see in order to really build wealth. Unfortunately, that’s not a safe annual return like your savings account, it’s a return that fluctuates – sometimes posting losses for years at a time. Some investors are just not comfortable with this type of volatility and turn away from stocks because they can’t stomach the roller coaster ride.

Since you can have a direct influence on the performance and value of your real estate investments, many people prefer commercial real estate investing to stock.

Many investors dip their toes in the water with a few rental homes or a small is a great spot to start building wealth and learning the commercial real estate industry. However, for investors looking for major retirement income that may be relied upon to grow in a hands-off portfolio, commercial property definitely has its place.

Commercial real estate for beginners is not something to be entered into lightly. It’s hard to read a book or talk to a broker and really understand everything that’s involved in making and financing a good real estate deal, and then managing your property once you have it in place.

I believe the two best methods for newbies to become involved in commercial real estate are to a) Work their way up through the ranks of owning smaller properties or b) Work with a mentor of some sort – ideally another property owner in your marketplace – to discover what they do, how they do it, and why they do it.

You can find a lot of salesmen trying to get you started in commercial real estate by buying their magical business-in-a-box but their claims of simplicity from just following a simple system are often over-stated. You can get yourself into a lot of hot water in commercial real estate as a beginner unfamiliar with the business, so if you can’t afford to make a mistake, it’s best to grow slowly and pay your dues. When you do dip your toe in the water, let the voices of experience guide you and check with your attorney, CPA, and other investors in your area to help you confirm you are on the right track.

If you need help with your real estate strategy, consider hiring a coach, mentor or independent real estate adviser who can help you evaluate your personal situation and/or the commercial property you’re considering.

Play it smart and look before you leap.

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