Smarter Faster Better: The Secrets of Being Productive in Life and Business
As real estate investors, we always have so much to do and never enough time to do it (I should know, this post took me forever to write!).
We have to market ourselves, meet people, research properties, make deals, and somehow find time to be a human outside of work, as if such a time exists.
Plus, if you are like me there is also a demanding full time job where you have to please the boss, shareholders, and the people you report to. So how does one get it all done? Quit the job!
Half joking.
For now the answer is be more productive on the things that you must focus on.
We are back again today with one of my current favorite authors, Charles Duhigg. Check out my thoughts on The Power of Habit where I include his credentials. For now, let’s jump right in to this book Smarter Faster Better.
Lesson 1: Motivation through choice
There are many things that motivate us as real estate investors.
The goal of reaching financial freedom, helping people escape bad housing situations, helping people by providing awesome housing situations.
Know why you are doing this because it is going to get tough (understatement). At some point that is a guarantee. Motivation has to be something outside a feeling. It has to be a choice.
Not just any choice either, it has to be a reflection of the values we have.
The technique that Duhigg recommends for motivation is making a choice, any choice, not matter how small. It makes you feel in control, especially when the situation is chaotic.
If you have choice, you have the ability to move forward. From there make another choice, then another.
You can accomplish what you set out to do only by taking action.
When most people think of motivation, they think about the feeling of wanting to do something. Sometimes you have that feeling in spades and can work like a machine because it is a burst of energy and focus. We’ve all felt this euphoric laser focus before where you actually want to be doing the task at hand.
It is wonderful and productive. You’re in the zone, killing it, crushing it, making it happen!
Other times you feel drained and unfocused. The couch calls and your Nexflix cue needs to be conquered.
The thing about motivation is that feelings change. I’ve often found that I can be totally unmotivated to do something until I start doing it then everything flows from there.
Make the small choice to start. We don’t need to wait for motivation to strike. We don’t need to feel like doing something in order to get it done.
What we can do, always, is make a choice.
Lesson 2: Mental models, because it is all in the mind
If you have ever envisioned something before it happened you have used a mental model.
In layman’s terms it is a projection of what you believe is likely to happen in any situation.
If you’ve ever paused before a call and thought about what you would say to a tenant or seller then thought through that conversation from start to finish, that is a mental model.
These help to prepare us with additional practice and also create a baseline for the interaction that is about to happen.
This baseline is something we can compare when our conversation or situation clashes with what we expect. That is when alarms go off in our mind and the red flags start to wave. Any deviation from the mental model is the thing that signals us to pay attention to what is happening.
The other part of mental models is probabilistic thinking.
This concept has dramatically changed the way that I think, in all aspects of my life. It applies to business and personal relationships.
Rather than thinking about future outcomes in black or white, think of them as a range of options and each option has a probably of happening. The concept seems so obvious, but how many of us really put it to use?
Here is a practical example from my life. Moving across the country and debating what I want to do with my primary residence. Black or white thinking (binary thinking) would say, hey Mark you have two options, sell or rent. That kind of thinking would give me a 50/50 chance for each possible future.
With probabilistic thinking I realize that there are odds to making a profit.
Now with some market research and discussion with many professionals (remember your team: appraisers, other Realtors, property managers, CPAs) I realize that the odds are MUCH greater I will make a profit selling rather than renting. Even though I have both options if I had to weight it then it wouldn’t be 50/50, it would be closer to 70/30 in favor of selling.
Why? Because if I sold at a price level I could probably attain, I would make a certain amount of money vs. renting at levels where I know it would take longer to get to the amount of return on investment from my initial down payment and the money I put into the property to fix it up.
In other words, I have a greater chance of making more money selling than long term buy and hold, right now in this market. Probabilistic thinking is saving my sanity by making me much more comfortable with my choices.
It doesn’t feel like I flipped a coin, it feels like I played my hand looking at all the cards on the table.
Lesson 3: Stretch goals and SMART goals, thinking big, and acting now
Some people believe you can only think about big, scary, audacious, goals that motivate you and fill you with fear and purpose. Others believe that it has be a tactical, quantifiable, immediately actionable goal that will get you moving in the right direction. Well, one of the mental models I like to use (see, helping already) is, “can I do both”?
I want to have and do it all and my thinking goes, if both are good on their own, can they be great together? Luckily Duhigg agrees. Use both.
Have a huge seemingly unattainable goal that will push you to innovate then take it and break it down to the actions and steps that need to happen.
It is one of the most powerful lessons from the book that can be applied to anything in life from your marriage, to your business, to your health.
It is called a stretch goal because it forces you out of your comfort zone, pushing you to where you want to reach. Attain stretch goals is not a given. These are the goals so big it changes the way you approach it. Stretch goals become the compass pointing you to something great.
SMART goals become the map showing you the journey in detail.
- Specific
- Measurable
- Achievable
- Realistic
- Time bound
SMART goals are interesting because there are a few versions of them.
I have my own as well and I’ll post about that some time in the future. The basics are that it is a plan laid out in detail giving you the parameters and end state to know if you are successful.
You know what you need to do to accomplish it in order to make progress.
Ambiguity is the heart of stretch goals in many ways but has no place in SMART goals.
Your stretch goal in real estate investing can be whatever is important to you.
Maybe it is to plan for retirement or to fund a new hobby.
The difference between a stretch goal and a SMART goal is the difference between:
• Stretch: I want to create a second stream of income and make $4,500 per month on rental unit cashflow
•SMART:
- Specific – purchase one unit that cash flows at $200
- Measurable – a monthly minimum $200 net in a separate account after purchasing a property and screening a tenant and renting it out
- Attainable – yes, as long as I run the numbers and do my due diligence on the property and the tenants, do everything legally, and ask professionals for help when I need it
- Realistic – yes, I have done it before and others have also. There are skills I need to learn but I don’t need to be particularly, impossibly talented to do this
- Time-bound – one unit within the next 12 months, then two units within 12 months, then…
This is just an example. Make one that resonates with you. Whatever makes real estate investing worth your time is the right answer!
I’ve always enjoyed experimenting with productivity hacks and implementing lessons learned from others because in the end we are all investing the one thing we can’t get back. Time.
Hopefully you learned something from today’s post.
Until next time, happy investing!
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