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The Laurex Process: Investment Management
Set Specific Cash Flow Objectives
By Jeffrey Taylor
Would you like to increase your rental profits this
year? Do you really? Here's a test question that will let me know if you are
serious. How much more profit do you want from each rental property (or
unit) you own? Did an exact figure come to your head? If not, then don't
fool yourself. Your rental profits will NOT increase. In fact, you can stop
reading now and watch TV, unless you are ready to get serious!
At the November General Meeting, I will share many cash flow building
strategies. But, wait a minute! I need to warn you, many of you will NOT
benefit from the money making ideas. Many others of you, however, will
benefit greatly. How is that possible that some will benefit and some won't
benefit when everybody is hearing or reading the same thing?
Listen to me carefully, please!! Some of you will miss great money
making/saving management ideas simply because you are not looking for any.
Let me say that again. Even though you are reading this issue right now and
will attend the General Meeting, many of you are simply not looking for cash
flow strategies that you can immediately implement in your rental business.
Most landlords have not really decided (gotten serious) about wanting more
rental profits.
I want you to be honest with yourself for a moment. Are you making the
following fundamental business mistake made by most business owners and
especially landlords? The business mistake I'm referring to is that you
don't know how much profit you want, or stated landlord to landlord,
You Have No Specific Cash Flow
Objectives for Each Rental You Own
For example, when I first started out as a rental owner, almost 20 years
ago, I was happy to simply break even on my cash flow. I quickly learned the
hard way that unexpected expenses or vacancies could occur, and without any
net profit or positive cash flow "buffer," I was in deep cash flow trouble.
Before the end of my first year of investing, I had a cash flow objective of
at least one hundred dollars net profit (after expenses) for each rental.
Within 5 years, the objective increased to at least $200 net profit. Now, my
objective is at least $300 net profit on each property or unit. That's why I
constantly search out and test cash flow strategies (that I share with
associations across the country more than any other landlording instructor)
because I have a specific objective that I aim to reach or maintain.
Let me say it another way, if I had no cash-flow objective, it wouldn't
matter what strategies I hear about because whatever income I'm currently
receiving is okay. And, that's how most owners are. We're busy doing
full-time jobs, involved with family, community, clubs, church, etc. and, as
long as the "rentals" are doing okay and not giving us any headaches, we
give little thought to them. In fact, for most landlords, the only time we
really give our rentals much thought is when rent is due, when a resident
has a problem or when property is vacant.
Does that sound anything like when you think of your rentals? You know I'm
telling the truth. You're happy simply if there are "no" problems. The idea
of actually doing something to increase rental profits normally does not
enter your mind (except when this newsletter challenges you each month,
which is why this subscription is so valuable to you). The problem with this
scenario is that if you have no cash flow objectives to reach, you do not
look for ways to get more income. Therefore, you don't do or try to do
anything to increase cash flow.
Having no cash-flow objectives (which increase) is a costly business
mistake. I want to challenge you now not to make this big "profit killer"
mistake.
Are you ready to get serious and work to increase rental profits? Really??
Well, make sure you attend the upcoming General Meeting!! Before the
meeting, I want you to do one real simple thing -- please, just do it!
(You'll thank me when you see me in person). Decide on a goal or a specific
dollar amount that you want to receive (above expenses) on each rental you
own. During the meeting, be ready to get at least three specific strategies
to reach the goal you establish. Then after the meeting, I want you to
monitor your profits each month, and see whether you are reaching that goal.
Start by making your goal at least $25 to $50 more monthly than you are
currently receiving (per unit). If you do the strategies I suggest at the
meeting, I guarantee you will reach your objective.
By the way, I'm assuming you keep and review accurate financial records so
you can actually determine where you stand "financially" right now. If not,
do not pass go and do not collect an "extra" $50. Stop, review and determine
exactly how much net profit you are now receiving. Since this is the tax
season, you should be able to pull your records together to determine
current profits.
Once again, set a goal of $25 to $50 higher than current profits for each
rental. Now is when your rental business can become exciting, because at the
meeting your eyes will begin to "see" all kinds of cash flow business ideas,
because you will be "ready" to see them. Plus, once you have a new monthly
cash-flow objective you are trying to reach, you will be much more motivated
to actually try the ideas I suggest. (Wow, what a unique thought.) And, by
monitoring your net income each month, if you come up short, you can make
minor adjustments to the strategy and maybe add one or two more strategies I
will give to those of you who need "advanced" training. Therefore, attending
the upcoming meeting and monthly monitoring of your net income will be vital
steps to your future success.
I challenge you further, to set a time limit on your goal to reach your new
cash flow objectives within 90 days after the seminar. And, if you use just
a few of the ideas I will share with you, I promise again, you will reach
your new cash-flow goals. But, it all starts with setting cash-flow goals.
As I asked at the beginning of this article, if you indeed really want
"more" profits from your rental business, what I have shared is the vital
first step to obtaining more.
Article Provided by:
Jeffrey Taylor
CEO, Mr. Landlord, Inc.
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