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More people are looking to become “investors” or try to achieve “financial freedom”. You’ll see thousands of posts on LinkedIn, many in the vein of “fake it till you make it” but at The Heaton Group we’ve become accustomed to investors who really know what they’re doing.
Financial Freedom?
The common misconception of the lifestyle of an investor is fast cars, big houses and always “smashing it”. While not unachievable, these are goals often only aimed for by the wrong types. Investment isn't always a full time job, actually - very few investors are "full time". It's seen as a "pension fund" or something to supplement their other incomes. Investment isn’t a “quick fix” to financial problems. It is a hard fought and considered journey. If you’ve achieved your portfolio, your investments are working hard in the background and you’re able to act on new opportunity then you’ll have a great lifestyle.
So how do you get there? Initially it’s all about making the right choice. There are a multitude of investment opportunities for todays entrepreneurs. There are business investment opportunities, joining consortium's, the stock market, property, speculation etc. Naturally, as a property developer we’re slight biased towards property as an investment opportunity, but there are reasons why it’s one of the safest options and has the biggest potential returns.
- Resilient market
- Consistent revenue from letting to tenants
- Good returns at the end, almost no depreciation in property
- Well managed portfolios are a good source of income
We’ve been developing properties and helping investors now for over 40 years. Below are some of the best tips we have if you’re looking to get into investing or even reminders if you’re a seasoned pro!
Be patient
Property is, and always will be a long-term investment gain. Patience is key when looking at our current investors. Unsuccessful investments are always the ones where there’s an expectation of returns almost immediately. While there are methods to achieve this (get in early before an area increases in value) – ultimately the property market shifts in years rather than months.
Build a portfolio
Banking on one big payoff is naturally frustrating if it doesn’t happen. Having all your cash tied up in one area is almost indicative of the above, hoping that the one big payout will finance your next investment opportunity. The best investors we’ve worked with have multiple pieces on the chess board, readily moving them around so that they maximise their returns in the long run from different sources/properties.
Don’t get bad habits
Becoming an investor is an exhilarating experience after the first real payoff – you’ll feel a rush like never before, you’ve made a good decision turn into a great decision, but what’s next? The investors who don’t last long in the business are those who spend their cash unwisely, make big purchases to show their newfound wealth and don’t think far ahead. The best investors we work with are relatively unassuming – sure, they’ll enjoy the finer things in life, but are rarely extravagant and are always looking for the next opportunity on the horizon with their hard-earned investment returns.
If you care what others think, you might fall
If you’ve got a defined plan, you’re going at the right pace, doing the right things and you’re happy with your progress then you’re fine. Don’t start comparing yourself with other people who have different aims and objectives. There may be a culture in some circles of “well I have an 8-bedroom mansion, what do you have?”. There could be millions of different circumstances that have led this person down that track. Their investments could have failed, and that property is 100% mortgaged. Be assured that if you’re doing the right things, you’ll be fine.
Stick to your plan
Some types of investment can be exceptionally volatile. The stock market is a great example of that. There will be peaks and troughs, same with businesses. Going back to property investment – that’s a safer option in most cases but if you set out a plan and you’ve got goals to achieve long term, don’t be swayed by short term opportunities. Often the best laid plans come to fruition with hard work in the long term, not the short term.
Summary
At the Heaton Group we’ve worked with all kinds of investors over the years, we’ll happily discuss any property investment opportunities with those ready to move now, or in the early stages. While not financial advisors, we are well placed to give you an idea of what to expect and how things will likely turn out by working with us.
Speak to us today on 01942 251 945 or fill out our contact form.