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The saying “time is money” couldn’t be more true when it comes to the world of investing. Time has a real effect on investments, so those who start building their real estate investment portfolios at an early age have a big advantage over those who invest later in life. In fact, it’s never too early to start investing—the sooner the better.
Investing at an early age isn’t much different in terms of strategy than investing when you’re older. Like any other venture, you need to have a plan, otherwise you run the risk of making rash decisions and losing money due to poor choices. Your plan should include your short-term and long-term goals, your budget and well-researched investing strategies that you plan to put into practice.
You must first start with your budget. Waiting until you have “extra” money to invest probably means you’ll be waiting forever. Instead, consider starting by contributing to a savings account. Determine how much you can afford to save from your monthly income. No matter how small the number is, start saving. Over time the money will accumulate and you’ll likely be able to make your first investment sooner than you expected.
Investing is a thrill, so it’s always important to know where you stand financially so you don’t find yourself between a rock and a hard place. Don’t spread your budget too thin. Though there may be an investment opportunity “too good to pass up” always remember that another one will come along in time.
While you’re saving, make a habit of keeping a close eye on market trends. Blindly investing in a market/ industry you know little about is a sure fire way to end up with an investment gone wrong. Though your strategy may seem flawless on paper, nothing is more valuable than knowledge and experience. Do your due diligence. Learn everything you can from people who are in the game, currently investing in the real estate market and successfully building their portfolios.
Then, when it’s time to look for your first investment, start small. Real estate investing isn’t about snagging the big fish your first time out on the water. It’s about researching and finding good investment opportunities. Get the hang of the process from start to finish before you tackle bigger projects.
Investing is a long-haul process. It also takes years of practice and experience to truly appreciate, understand, and master. Investing in real estate doesn’t often produce the get-rich-quick results promised by late-night infomercials, but the appeal of investing in real estate is that for those willing to do their homework, make good purchases and properly manage their investments, the rewards can be substantial.