Goals provide us with direction and purpose, acting as the foundation for every significant endeavor. Your goals should be written down, but they don’t need to be lengthy or complex.
How to Get Started
You can start with just the following items:
- Current situation: What is your current or anticipated financial capacity within a reasonable time frame? Get preapproved for an investor loan to determine your accessible credit limit.
- Financial end goal: Typically, this refers to an income goal, like earning $10,000 a month in today’s dollars.
- Time frame: The less time you have to reach your goal, the more initial capital and credit you will require.
However, goals by themselves are not enough. Goals without an action plan are merely daydreams.
Creating an Action Plan
To create an action plan, start with your end goal and work backward to your current situation. It may take multiple iterations before you bridge the gap between your current situation and your goal.
Each step of your action plan must meet the following five requirements:
- Specific: Specify a clear, specific step.
- Example: “Select a city of investment with a metro population >1M and 2% to 3% annual population growth.”
- Measurable: Establish criteria for measuring progress toward the attainment of your goal.
- Example: “How much cash have I saved or generated from investments in the past six months? How much more do I need before I can acquire another investment property?”
- Achievable: A step should be realistic and achievable. It needs to be sufficiently challenging to motivate and push you but not so hard as to be impossible. If a step is too daunting, break it down into smaller, manageable steps.
- Relevant: Ensure that the goal matters to you and aligns with other relevant goals.
- Example: “Interview and identify an experienced investment real estate agent to assist in purchasing a property that aligns with my long-term goal of financial independence.”
- Time-bound: A step should have a specific deadline or time frame for completion to maintain accountability and focus on progress.
- Example: “Complete the purchase of a property within the next three months and begin leasing it out immediately afterward to start generating income.”
Final Thoughts
With a clear goal coupled with an action plan, achieving your goal now depends on consistent execution, not just hoping that “somehow” things will work out.
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Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.
