Is It Truly Worth It?

Wednesday, May 17, 2023

Primary Blog/Is It Truly Worth It?

Reflections on Investment Returns

A recent conversation with a new funding partner got me thinking deeply about this question.

After sending him a new project with a 7% preferred return (plus equity upside), he reached out to me and said:

“I'd only clear about $$7,000 a year for risking $100,000. I mean, I could keep my cash in the bank and let it work for the next year, and earn $4000 without any of the risk.”

I completely understood where he was coming from.
Just the day before, he had transferred a significant sum of money from his bank account, and now, looking at the reduced balance, he was understandably concerned.
I've been there myself more than once.

He had a point; he could indeed make that same amount in a year at the bank.
But then it becomes a question of income versus growth. Perhaps he hadn't immediately realized that he could do both.

The Importance of Wealth Pursuit

The pursuit of wealth is crucial.

It's our best bet against the challenges and uncertainties I face individually and as a nation. We must continuously expand our knowledge and diversify our income streams.

This is the only way I can mitigate the financial impact of unforeseen events.

So, his question, "Is it worth it?"  lingered in my mind last night and throughout this morning.

Why go through the process of reviewing a new loan, paying an attorney to review it, and then make a return equivalent to ‘just’ 7%?

Exploring Alternative Investments

I encouraged him to compare this return against other possibilities: investments in the stock market, buying gold bullion, and so on.

I asked if he could find a similarly secure return with collateral in such a short time (just three years) anywhere else.  Before I could even finish the question, he interjected:
"Of course not."

This is typically the response I all give.

So, is it worth it?

Embracing Discomfort for Growth

When I step out of our comfort zone, our minds naturally become uneasy.
The farther I move from what I 'know' about 'who' I are, the more unsettling life can feel.
It's not something we can ignore; it's ingrained in us from day one.

The key to transcending this discomfort is to continually place ourselves in situations that make us uneasy.

This transforms 'uneasy' into the new norm.
We explore new thoughts, try new things, and gain new experiences, all while acting in spite of fear.

In doing so, I develop courage.

Assessing Your Specific Goals

The initial question of 'worth' hinges on your very specific goals, just as it did for my funding partner.

Here are a few questions to help you determine the answer:

  • ​Do you need to get your money working for you?
  • ​Are you in your mid-forties or older, starting to see the writing on the wall?
  • ​Can you envision a future that can only be attained by stretching beyond your current knowledge and comfort zone?

Conclusion: Taking Action and Assessing Worth

If you answered yes to these questions, then it’s truly a resounding YES!
The only way to assess its worth is by comparing it to other options, seeing if your plan can be put into action, and then… taking that action!

Afterward, measure the results: risk versus reward.
If it's a good fit, do it again (paying attention to whether or not the economic climate is still the same, or improving/declining).

Soon, you might find yourself doing it exclusively because it has become second nature.
You'll want to repeat it over and over because it's now comfortable.

Yes, my friend, it is unquestionably worth it. And not just in financial terms.

So, how can you stretch beyond what you know, right now?

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Hi, I Am Roger King

Founder REI Accelerator

With The REI Accelerator - Founders Group, you're not just learning real estate; you're scripting your success story... One property at a time.

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