Goals… Good or Bad?

Goals can be a great thing if we set the right goals using the right methods. Setting the wrong goals can be very detrimental to your business. Are you setting the right goals? In this article I am going to take a contrarian point of view to the normal goal setting info that most people teach. Let me go on record as saying I disagree with most of the general goal setting info put out in the information market these days.

When I take on a new real estate student one of the first things I do is to have a discussion about the student’s goals for the future. Usually I receive relatively similar responses such as “I want to quit my job and create $10,000 a month in passive revenue in the next 6 months” or “I want to quit my full time job and close 1000 units in 2016.” These technically may seem like good goals. They have a definite time line and a clear starting and stopping point. It will be easy to know when you have reached these goals. These are all things that make up a good goal but they may not be good at all. If these seem like goals you would set or if you have goals that are similar then I will ask you the same question I ask my students.

“Do you know what it takes to complete these goals?”

I don’t mean do you generally have an idea of what it takes; I mean do you specifically know the technical process and requirements needed to achieve these goals? Do you have a solid business plan that you are executing to achieve these goals? If the answer is “no” then these are not goals but wishes for the future. Wishes are fine but businesses are not built on wishes but on solid plans. You need to have a very clear understanding of the process in which you will attain the goals or you are likely to fail at the goals and that is worse than not setting them in the first place. Not reaching our goals can create frustration, depression and anxiety.

The first step to setting goals is to understand each little detail about the requirements of reaching those goals. For example if you want to close on a 100 unit apartment complex (or any size deal), do you have all the cash to buy the property? If not then you will need a loan. Do you know what it takes to qualify for the loan? In this case you will need net worth in excess of the loan amount. If you are not already worth the value of the property, then you will need to find some financial partners who do have the bank account that will help you get the loan. Now you can see that it would be better to set a goal of finding a financial partner in the next few months than setting a goal of closing any amount of units. Without the first goal the second is almost unattainable. Do you have the property experience to satisfy the lender? Do you have the earnest money or the down payment? Deciding to find the solutions to these immediate problems would be much better than setting any long term goal for the future. If you can take care of today you are likely to be well prepared for the future.

All successful ventures begin with thought. All good goal setting activities start with an education and understanding of what it takes to achieve these goals. With this info we create a real plan to move forward not pie-in-the-sky wishes that we tell ourselves are “goals”.

My formula for goal setting is to start by creating your 1 year, 3 year, and 5 year goals. Once you have them, write them down and forget them. Stick them in a drawer and only pull them out once a year as a reference. “Set them and forget them”. Now you need to create you second set of goals. These are what I call discipline goals. A discipline goal is something that follows two rules. First the goal must never be actually attainable and secondly it should never extend beyond 1 week. Let me explain.

Your discipline goals must reset every week so that they are never really reachable. If one of your goals is to own X amount of units in the next year then your weekly goal should be to look at 3 deals every week. If it is Thursday and you have only looked at 1 property then you have 2 more to go by weeks end because the next week the goal of 3 resets. If you need financial partners then you should set a weekly goal of attending 2 networking events. That too will reset each week. Now you see what I mean by never extending any real goal past 1 week and it should not be something that is attainable because it will reset each week. If you can take care of your goals for this week you are pretty set up for next week. If you can reach your goals next week you are heading in to the next month strong. Next month leads to year one. Year one leads to year three and five. If you take care of today then tomorrow is much easier to handle.

This is why I say that you should set your long term goals and then ignore them to focus on today’s goals. Long term goals are made up of lots of short term successes. Understand what it is that you are trying to accomplish, why you are trying to accomplish it and what it takes to accomplish it and you are on the path to setting reasonable goals that will lead to long term success not long term frustration.

Good luck,

Bill Ham