I recently was going back and forth with someone on Facebook about how most people can not afford a TESLA. His argument was that, the average person does not make enough to afford the payments, even the more affordable Model 3. My counter point was, pretty much anyone can afford the things they want IF they are willing to look at their finances and make the necessary sacrifices. Instead people look at the current financial situation and decide from there they can not afford it.
This is where I think people make the biggest mistake. It is easy to see what their current financial situation is and decide right there that something is too expensive. But if they do a serious evaluation of where they are spending their money and cutting out the unnecessary spending, they will see they can afford things like a TESLA , just hardly anyone will take the time and make the sacrifices to do this.
What Can you Cut Out?
If you looked at your financial statements and bank accounts do you think you can find some things you spent money on stupidly? I guarantee you can. I’m sure somewhere in the last 12 months you spent money on something that if you really think about it, wasn’t a good investment. I refer back to Starbucks often in my posts and videos becuase it is a perfect example of not spending money wisely. If you are going to Starbucks and walking out with a $5.00 cup of coffee each time, you are throwing money away at a depreciating asset. Once that cup of coffee is gone, so is your money. Why not make the coffee at home? Or limit yourself to one stop at Starbucks a week? I did this a few years back and I’ve saved thousands by only treating myself to one cup a week. I drink plain black coffee not even the fancy stuff and it still added up to over a thousand dollars I spent one year on coffee. Now I bring mine from home or wait until I get into the office to have some. This is just one example, I’m sure your finances are filled with plenty examples like this.
Stop Shopping at Expensive Places
Whole Foods vs Aldi. This one is a favorite debate of mine. I’ve had a lot of people tell me they shop at Whole Foods like it is supposed to impress me and the people they know. I ask them why don’t they just got to Aldi’s? It’s a lot cheaper and you can still get quality stuff there? The looks I get are hilarious. I should record them and start a website with them. When I say Aldi’s, people immediately think “poor,” which is the wrong mindset. They should be thinking about all of the things they can do with the extra money they will have available by not shopping at a place just to impress people. Plus, NO ONE CARES WHERE YOU GET YOUR GROCERIES.
I understand you can’t get everything at Aldi’s and Whole Foods does offer some different things, but why not do the bulk of your shopping at Aldi’s and only stop at Whole Foods for a few things. It will still save you a lot of money. You get the point and this can be applied to other things in you life as well. Taking it a step further why not buy in bulk from Costco? Just a thought.
Reinvest Back in to Your Business
So how does this tie into real estate? You need to take into account ALL of your finances when you look at your business, not just what you are spending on your business. If you are able to save money in other parts of your life, you will have that extra money to now put back into your business. I think this is something that is completely overlooked by agents when they look at their business. They will spend the time to be smart with their money on their business but will spend stupidly in their personal life. It is all one in the same and you need to think of this way. There is a ripple affect how you spend your money everywhere. So be smart with it in all aspects of your life.
So now that you have all of this extra money USE IT! Start faming a building or area. Spend more money marketing to your database. Throw a client appreciate party. Send gifts to clients. Buy a better CRM. Spend money on Facebook and Instagram ads. Pay a graphic designer to create a logo for your brand. Hell maybe get some swag made of your brand so you can rep your brand everywhere you go! Still be smart with how you spend it but putting the extra money back in your business is never a bad thing.
QUICK NOTE: When I say be smart reinvesting back into your business I mean don’t spend it on outdated medias like billboards and bus benches or on cold calling systems when you suck on the phone, and especially not on sites like Zillow and Realtor.com for their leads. These are a complete waste of money and will not help you grow your business.
To wrap this up, you can apply these examples to all parts of your life. Really think about it. Do you need designer jeans? Do you have to wear a name brand? Do you EVER need to pay full price for everything? AKA LOOK FOR SALES! If you take the time cut out the things you don’t need to be spending money on you will be amazed at how much more money you will have to reinvest into other parts of your life, especially your business. Keep in mind agents, we are fully commission based. There is no guarantee when we will be receiving our next check so it is even more vital we are smart with our money. Case in point is this years market that is slow or any recession or crash that might happen. The agent’s that are saving saving their money and spending it wisely will come through those times and will prosper after as lots of other agents will have to leave the industry and find other more safe jobs to support their spending habits.