The Peter Principle & New Year Goal Setting

The Peter Principle & New Year Goal Setting

Jason ends 2018 with discussion the market’s softening and a look at what’s happneing in the high end housing sector. He talks about how a government shutout could provide opportunities for businesses. In the second segment of the show, he talks about New Year’s Resolutions and how to set goals. Write them down and share them with those closest to you. This will help give accountability and move you closer to your financial independence.

Investor 0:00
Taki event was amazing. I thought that I knew a lot about real estate. But coming to your summer, I realized there’s a lot of things that I don’t know. And one thing that you did besides teach me a lot about real estate is you inspired me to look beyond where I live and to, you know, kind of shrink down the world and make it smaller so that I can invest some places that are further away and get better returns. So I really appreciate that. And I’m excited to be here this weekend. And, again, for me, and from all the people I heard there, thanks for doing these events cuz they’re great.

Announcer 0:34
Welcome to the creating wealth show with Jason Hartman. You’re about to learn a new slant on investing some exciting techniques and fresh new approaches to the world’s most historically proven asset class that will enable you to create more wealth and freedom than you ever thought possible. Jason is a genuine self made multi millionaire who’s actually been there and done it. He’s a successful investor lender. A developer and entrepreneur who’s owned properties in 11 states had hundreds of tenants and been involved in thousands of real estate transactions. This program will help you follow in Jason’s footsteps on the road to your financial independence day. You really can do it. And now here’s your host, Jason Hartman with the complete solution for real estate investors.

Jason Hartman 1:24
Welcome to Episode 1104 1104. This is your host Jason Hartman with a last episode of the year. Yes, we’ve got another new year upon us. And a great quote that is really not just about the new year but it’s about all of life. This one is from Vern McClellan. And it says what the new year brings to you will depend a great deal on what you bring to the new year. And isn’t that the truth about everything in life right life is a do it for yourself. A do it to yourself. Project, right? It’s a DIY, do it yourself project. And it is a project that is always under construction. Life is always under construction, the road to success is always under construction. One never arrives at a point called success. They just constantly iterate and adjust the course along the way. And when things go wrong, they go through the problem, they just take care of it. That’s the way successful people work. So what we bring to the New Year will decide how our new year is, isn’t it? And what we bring to life will decide how life is for us. That’s the way it works. And we all know this logically, but to we always act that way when it comes right down to it right. That’s the thing. So that’s the trick. That’s what we’ve got to do is remember that it is We bring to the table that matters, right? So a lot of stuff going on the economy is definitely changing high end housing markets. And when I say high end, you know, that is such a, I don’t know, I have problems with that phrase high end, what does that mean high end, low end, you know, middle end, whatever. But the markets on the coast, the higher price markets, the cyclical markets around the country and around the world, are starting to show signs of significant suffering. We’ve been reporting on this for a long time here on the creating wealth show in my other podcast, and there is no question it is happening. No question. We should be mindful of that. Now. I’ve always noticed in my many, many, many years, well, I could say in my few decades, in real estate, now, the only real career I’ve ever had the real estate career. You know, I’ve always noticed they didn’t eat cycle and I’ve been through many cycles, not like a lot of these inexperienced, so called gurus out there, it will either start at one end or the other. Sometimes the first time buyer market, the slow end, the low end of the market slows down first. And sometimes the higher end of the market really gets very squishy first, right? And it changes but this time it’s definitely the high price market that is very squishy, very soft. You know, I just like that word squishy. Talk about a word that describes something accurately right, squishy, pretty good word. Anyway, that part of the marketplace is very soft. And why we have to be mindful is look, hey, we’re not investing in those markets, because they don’t make any sense. They never make sense. Even when you buy at the bottom of those markets in the trots. The properties don’t make sense. But but but but we have to be mindful because this like so many things. may well trickle down. It certainly has not yet. The low priced entry level housing markets are still very, very tight inventory very tight. But that too will change at some point along the way. So by the properties, right, long term vision, and all the other things we talked about on the show, and you’ll be okay. So a couple of little updates, little economic news here. A recent survey of home owners show that aesthetic appeal, affordability and commute times, along with a neighborhood character were the top reasons for picking a home. Now, you know, a statement like that just makes me wonder, do you really need a survey to tell you that? I mean, what else are they going to say? Right? Are they going to say, well, we really like ugly overpriced homes with long commutes in neighborhoods that completely lack character. Yeah, you know, some times you really wonder why you need a survey for something like that? Okay. Now we have not talked, although I should have talked about it last week, but time did not permit we have not talked about one of my favorite things. The government shut down.

Jason Hartman 6:15
Yay. Yes.

Jason Hartman 6:17
With the government. It’s called a shutdown, but it’s really not shut down. It’s a shutdown of some departments have are massively over, expansive, over intrusive, ridiculously overweight government. You know, some of the departments have shut down. So our government workers, what I’m talking about the workers that’s different from obviously the lawmakers I should really say the lawmakers, right. The lawmakers when they are on hiatus, they’re not available to restrict our freedom. Yeah, they’re busy doing something else right. But when they’re in session, and when they are putting their dictates through to these various Government agencies when those agencies are in operation, what does that do for us? I would submit to you, you know, maybe some of you will disagree with us. But then again, you’re probably not looking at it deeply enough. I’m just saying, Okay. But I would submit to you that they do very little to improve our liberty, and a lot to restrict our freedom. That’s what they do. And the concept of anything in government is always you got to do more. You got to do more and what is doing more in the world of government mean? It means Rob Peter to pay Paul. It means that right, that’s always what government is doing right. robbing Peter to pay Paul. The other thing they do is they got to make a new law, new regulation, a new restriction, a new way to squash are somewhat squishy. freedoms. Right? You know, if the founding fathers saw what we have today, they would be rolling over in their graves as the saying goes, and I’m sure they’re doing that, right. But yes, I am in favor of a government shutdown because it really shows us now Look, I know it’s massively inefficient. It causes many inconveniences, including things with real estate, right? It slows a lot of real estate deals down but but but that’s just temporary look at if these parts of the government were to permanently shut down. Right, then the market would work its way around this stuff. A lot of people don’t realize that right? They think oh, my gosh, the government shut down. Look at the same convenience. This is why we need it open right away. Please think differently. Okay. think differently about that. Right? You couldn’t think that well, what if this whole area of the government just went away forever, and then we wouldn’t need the government at all. It wouldn’t be in our way and if we needed something there, the private sector would have filled that void like they always do. You know, I was talking to my girlfriend just this morning about this, okay? And she sells on Amazon, okay sells products on Amazon. And it is amazing to me how when a new product category has like one seller, right? And then the word gets out and the capitalist market, the free market responds so efficiently and so many more products, so many more sellers come in to fill the void. She, for example, is always searching for a new product to sell, looking out into the marketplace and saying what are the needs? What does the market want? What will the market pay me for? You know, we’re traveling around Europe and she’s looking at this trinket that trinket that product, is that something people would buy? You know, always thinking how can I fill a need, how can I create that one? When that takes place in a free market, the government on the other hand does the complete opposite, right? Most of the time not always look at I, I’m not an anarchist. Okay. I like a little bit of government. I like the government we can see. Okay, the, you know, any 10 storey government building, As the old saying goes, you know, keep the first three floors, all those people are actually doing real work, right? We need those people, you know, police fire, some degree of regulation and, and governance, right. I’m not an anarchist. But the top seven floors above those were the mostly overpaid bureaucrats fighting to keep their jobs victims or the taxpayers the victim of what’s known as the Peter Principle, right? Remember that old book from many decades ago, the Peter Principle. I remember when I was a young kid, I pulled it off my mom’s bookshelf, and she was reading it to me. And at a very young age. I don’t know how old was I back then? Maybe, oh, seven or eight years old, right? Back then I remember her reading the Peter Principle to me. And the Peter Principle is, is that everybody in their career or in life in general, think about this. And think about how it applies to the person in the mirror. Right? I think about this, how does this apply to me? Right? And it does that applies to me, it applies to everybody. We all reach our level of in competence. Yes, the Peter Principle, we reach our level of incompetence. And when this happens inside a big corporation, or in even more so in a worst way, in government agencies, right, we reach our level of incompetence, you know, we have competence of a level we get promoted, we have competence, another level, we get promoted, we move ahead. And you know, maybe you don’t have a job where you get promoted, maybe you’re a salesperson or an entrepreneur, or some kind of independent contractor. So there’s not an official promotion, but you basically promote yourself. Because you become more efficient, you earn more money, you know, your hourly rate goes up, right? It doesn’t have to be at a named promotion like it is in big organizations, or the military or government or, or in a big company, right? You don’t have to have a title with it necessarily. But you know what I mean, there’s still a promotion that occurs in this eventually stops, right. And at some point, we’ve reached above our pay grade. This happens all the time. I’ve seen it over and over, you know, we have these laws in the US that you can’t, as an employer, you can’t discriminate on the basis of many things including age, right? So we have these anti discrimination laws to protect people who are over 40. I believe over 40 is when you can claim age discrimination, right? And so guess what happens? And I’ve seen this happen tons of times with 50 year olds or 50 plus year olds, they reach a very high level in their corporate jobs. And they’ve many times not always, but many times have reached their level of incompetence. And they’re getting a massively high salary or you know, a massively high comp plan with bonuses and stuff. And then guess what happens? You know what I’m going to say, don’t you? Do you know what I’m going to say? They get laid off, right? They get laid off or they get fired. And then they can never regain that same level. And they wonder what’s happened, right? Well, the world has changed and the right about that the world has definitely changed. There’s no question right? When they were doing that job for the last 20 years, the world changed around them, no question. But you know what they do? And you know, how know so many of these people, they get into real estate. Yeah, and I’m talking traditional real estate when I used to have my traditional real estate company from 1997 to 2005, when Coldwell Banker bought it from me, and that was in Orange County, California, and I had many, many people who were like 50 plus People I mean, maybe in their 40s, sometimes, but mostly 50. Plus, they had this big corporate job, they were earning many hundreds of thousands of dollars a year. And they got laid off. And so what do they do? The default answer is, Hey, I’ll get into real estate. I know a lot of people, I live in an expensive area here in Irvine or Newport Beach, and I’m going to sell houses, right. And they struggle, they a lot of times they struggle because they don’t have the mindset of the entrepreneur, where you’ve got to go out and spend money first and make effort first. And then hopefully, you got to have faith that those rewards will come. Well. The same is true with real estate investing, right? Because as we move into the new year, and I want to liken this to how I would train real estate agents over many, many years, you know, a lot of us have new year’s resolutions about our investment portfolio. Some of you are saying I’m going to buy one or two properties every month. So I’m going to acquire maybe 12 to 24 properties next year, many of you listening who are our clients. I know you’ll do that. And we’ll help you do that. And we love you. And thank you for your, your faith in us and your continued business. And some will say, one, I just want to buy a house a year, if I can buy one property per year, for the next 10 years, that’s going to be a nice retirement for me, right. And so that’s your New Year’s resolution, that’s your goal, acquire one more property, acquire six more properties, or acquire 12 more properties in the new year, whatever that number is, or 24, more properties, whatever it is, right? Whatever it is, just stay on that path and do it and take incremental steps to move forward on that path. Now, here’s one of the things when I would train real estate agents, many of them who reached their level of incompetence in corporate America or maybe a government job. And in the government. The problem is the problem with the government is they don’t lay people off, right. You know, those jobs are way too secure. And so people really lose their edge. It’s not good for the person right? You think it’s good for the person, right? Hey, you know, it’s good to have a squishy, cushy job. You know, it’s easy. making a lot of money, I got job security, blah, blah, blah. But you know what? That might seem good on the surface, but it’s really not good at all. Why is it not good because it causes people to lose their edge. They become lesser people. It’s like my mother, when she graduated from UC Berkeley, in the 60s, nonetheless, remember Berkeley in the 60s, you know what I’m going to say what it was like back then. Right? And she got a degree in social welfare. And she became a social worker. Can you believe it? I am the kid of a social worker who graduated from liberal Berkeley in the 60s of all things. I know. It’s crazy. And mom and I share pretty much the same political views most of the time. It’s kind of odd that she has those views because she doesn’t seem like it with her background. You know, she grew up poor, upstate New York on a dirt road goes to Berkeley. Very good school, but very left wing school, even then back in the 60s, you know, the hippie era, and then gets a degree in social welfare, not business. And then guess what? After that she becomes a social worker, right? And she saw she was responsible for knocking on people’s doors, having cases visiting people visiting families, and doling out government welfare to them. And she said she couldn’t stand it. Because after doing that, for a few years, she saw how the more money the government gave these people, the worse they became. It didn’t make them better people. It made them worse. It took off their edge it made them lazy, you know, as humans, we all need some challenges. You know, we we need to engage in the chase. I just got back from my daily ritual, sometimes twice a day, hopefully, of taking my dog out and throwing the ball to her and my dog is a predator. Wow. She has a dogs have several drives, you know if you know anything about dogs, right, they have that prey drive, they have a food drive, you know they have an affection drive and you know they have all these different drives just like we do as humans, right? We have the same drives to in a different sort of way. But my dog has a very strong prey drive. She loves to chase prey. You know, it’s rabbit season. She loves chasing those rabbits. Let me tell you those rabbits, you know, duck season. The Ducks not so much but rabbit season, definitely rabbit season. And so she loves chasing the ball because the ball is prey. Right? And you know, what I notice is that the more challenging I make it for her, the more she likes it, and the better she gets at it, right? So a little challenge is important. Take relationships, romantic relationships, right? You know, there’s this tendency when you’re in them for a long time. We all do this. I know we all do it. It’s not just me. I know. We’re all pretty much wired the same out there. You know, after all, While we sort of become complacent, we get a little lazy, we gained some weight, we stopped doing the things that got the person interested in us in the first place or us interested in them. And you need to keep a little edge in the relationship. Right? A little edges. Good, right? And so this is true of all things human. We humans, generally speaking, we all like some challenges. You know, steel is hardened by fire, right? diamonds are, you know, polished by pressure. And while they’re, they’re made by pressure and polish with friction, right? So this is all good stuff, right? So don’t lose your edge and do things to increase your edge intentionally. Sometimes I would submit in the new year, right? intentionally once in a while, don’t make this a habit. It’s just something you do once in a while. Do things to make your life harder, intentionally. Yeah, I really said that. And I really mean it. Do things Challenge yourself, do things that will make life harder for you. Sometimes don’t do it a lot, just do it a little bit. Don’t be a masochist about it, but do a few things that are going to make you grow. Right, you know, you got to prune a tree right and it grows stronger when you prune it. many ways to do this, obviously, but one way is the mastermind, the mastermind principle getting in a mastermind group, because you’ll be challenged and held accountable. Come to events like our upcoming meet the Masters Jason Hartman comm slash masters, many of you have started registering for that. So we’re looking forward to seeing you there in Southern California in March. Okay, so that’s coming up. We’re gonna announce more specifics soon. But you got super early bird prices, which by the way, if you’re listening to this Monday on New Year’s Eve, you’ve only got till Friday, then we, the price goes up. Okay, we’re on a super early bird price right now. So those tickets are very, very cheap. Go ahead and get those. We will be announcing speakers and topics and all that kind of stuff. This is our 21st anniversary, meet the Masters, go to Jason Hartman comm slash masters and get your tickets ASAP. And here’s the thing is I would train agents that I want to get back to that because I think this is very true of investors. You know, one of the things, non entrepreneurs come to the mindset, they come to the mindset of, hey, look, I’m going to provide a service to my employer, and they’re going to pay me for the service, right? That mindset varies with investors and entrepreneurs a little bit because the investor and the entrepreneur, they need to put the wood into the fireplace first. And then they get the heat, right. So as investors, let’s think about it from there. Well, let me tell you what I used to say to real estate agents. They’d come in, they’d have these lofty goals when they interviewed me and they’d say, Well, you know, I’m new in the business, but I want to make $100,000 or $200,000 It’s my first year. Right? Those are pretty big goals for a beginner. Okay, I think those are big goals. And some, you know, maybe more, but that would be something I’d hear a lot. And the typical expense ratio for a new real estate agent is about well, it should be about 50%. Okay, so whatever your you earn gross, you should plan on netting about 50% of that. So I would say to them, Look, if you want to make $100,000 I’m not going to ask you how you’re going to make $100,000. What I want to talk to you about is how are you going to spend 50,000? How are you going to spend $50,000 marketing yourself so that you can earn $100,000 put in the wood first, and then the market place will give you some heat, right? You got to put in the word first. And as investors it’s the same thing, isn’t it? Because we’re not the type that falls for that, you know, to a infomercial That says, Oh, you know, I bought someone’s, you know, audio program and I made $30,000 my first month No, we’re going to put in the wood first. We know most of those things are BS. I mean, they got like one or two examples out of a million, right and look at in every area of life, folks. There’s a one of the million example. Okay, there’s someone who did it got lucky, overcame incredible odds, whatever, you know, it’s all certainly possible, but it’s highly unlikely. Okay. So you save up money, and then you invest the money, and then the return trickles back to rather slowly, right, usually. And so you save up $30,000 $25,000 you buy a property you go to Jason Hartman calm you click on the Properties page, you talk to our one of our investment counselors, you buy your first property right? And then the return comes out slowly. But wait, it’s not always that easy. Sometimes, you know, God or fate just throws in other words. Buck in your face, and you think it’s all going to be smooth sailing. And then a problem occurs and unexpected repair maintenance issue bad tenant, eviction, whatever, right? There are problems. This is life. Come on, get over it. That’s the way it goes. Okay. And the test the test will be can you get through it? Can you overcome it? And you know, what, if you don’t love a challenge, teach yourself to love a challenge, okay? And one of the ways you teach yourself to love a challenge is by overcoming challenges, right? You know, it’s, it’s like the old saying, right? You can’t get the job unless you have experience and you can’t get any experience unless someone will give you a job so you can get some experience, right? It’s a you know, but somehow, most people get their first job and then they get some experience right? This happens right? What came first the chicken or the egg? And so overcome challenge challenge yourself to things and overcome Come a small challenge and then you can overcome a bigger one and a bigger one. One of my favorite quotes is something to this effect. And I can’t remember who said it. But here’s the gist of it. People are like tea bags. You never see how strong they are, until you put them in some hot water. Think about that. People are like tea bags. You never know how strong they are until you dip them in some hot water. It’s just like that tea bag. That’s the thing. overcome some challenges, overcome some problems. So you know, Norman Vincent Peale, the late Norman Vincent Peale, motivational speaker positive thinking guy, he used to go on stage and like do this prayer like God, please give me another problem. I need another problem to show. Let me show you that I’m worthy, right, you know, give me a problem so I can overcome it. Something I can sink my teeth into. So you know, I think these are just some ideas of how we should look at the new year right and how we should look at our new year’s resolutions. Now The other thing is 80% of Americans, they say, don’t have any goals, no goals at all 80% of the population, right? So if you have a goal, or hopefully a few goals, you’re in the top 20%. Congratulations. Now, of the people that have goals in that top 20% Guess what? How many do you think have written goals? You know, they have a vague idea of the goal in their head, right? But when it’s written, it becomes much more real. You gotta write it down. And I would submit to you that, you know, the age of typing everything. I don’t know, it’s not the same. There’s a certain quality to writing with your hand. I would say that this is one You know, a lot of people listening journal right? Are you are you a journaler you engage in journaling? I’ve never been able to get myself to do that quite much, you know, too well. I’ve never been much of a journal. I think it’s probably would be a great idea. But I’ve tried it many times, it just never quite catches on with me. So whatever, I’ll accept myself as I am and, and not agonize too much about that. But if you’re not a journaler, write down a couple three goals, top three goals on a card and stick it in your wallet and look at it, make it your screensaver on your computer, whatever, you know, a lot of things but get it written. And when I say written, yeah, could be typed. But I think there is something to actually writing. Okay. In fact, you might want to write it over and over, write these goals you have and make them SMART goals, you know, so they’re measurable, and they’re time specific. And the goal is specific. And you know, all of those things we’ve talked about on prior episodes, right? sm AR t goals. Go to the Google and look it up when you’re on the line. Online, Google, I know. Remember that movie. I’m going to go on the line. And I’m going to go to the Google and ask it

Jason Hartman 28:00
Funny, funny comedy, right? Do that get those goals committed? Look at them often. Okay? Look at them often. So if your goal is to buy one property in the coming year, if your goal is to buy 12 properties, one per month, or 24 properties, two per month, whatever your goal is, get it written down and look at it often don’t just write it down and forget about it. Look at it all the time. You know what a good thing to do is most most of you listening I’m sure, use electronic calendars, right. So if you use, say, the Google suite and their calendar, right, just put a reminder, every week or every month or pay every day, you know, you can just do the repeat function for your goal, write it in your calendar, and it will just keep popping up and you’ll see it all the time. That’s a good way to do it. That’s a more modern way than a little card in your wallet. But whatever. Just do it. Get your goals written down, look at them often. Think about them often. amazing thing happens. Things just start happening now, with every goal, you need certain things you’re going to need to involve others, right? You’re going to need to involve people in your goal. Right? So obviously the first place is, you know, your significant other your family, share these goals with them. Maybe declare them publicly that makes it a lot more real. When you do that. That’s another big value of a mastermind group. Like the venture Alliance mastermind shameless plug, venture Alliance mastermind calm. Okay, that was a subliminal message. Now. We’ll get back to our regular programming and declare them to your family, declare them publicly and then think of the people you need to involve. So in the case of investing in properties and building your portfolio, you need to involve us. Hopefully you’re listening to every single podcast episode I have. Thank you for listening. And then you are engaging with our team, one of our investment counselors and the rest of the people on our team our local market. specialists etc. And you know, we’re all here for we’re all here, this whole team of people is here to help you achieve your goals, and own more of the most historically proven asset class in world history, income property. And that’s what we’re here for. So we’ll talk more about goals in the coming year. I see that I am running up against a time limit here. So I must bid you a farewell and a very Happy New Year. We’ll talk to you in a couple more days. We’re on every Monday, Wednesday and Friday, of course, Jason hartman.com slash masters. Get your tickets before Friday, before this Friday, for the super early bird special Hey, you can get them after but you’re going to pay a little more. It’s like the airlines you know the price goes up as the time approaches. Make sure you register and get your tickets for meet the masters. We’ve got a great hotel rate, by the way, only $169 per night. I think that’s the number on our room, block and Very nice hotel in a very prestigious location soon to be announced. So Jason hartman.com slash masters and until the next episode, happy investing and of course is very happy and successful New Year. Talk to you on the next episode. Thank you so much for listening. Please be sure to subscribe so that you don’t miss any episodes. Be sure to check out the show’s specific website and our general website heart and Mediacom for appropriate disclaimers and Terms of Service. Remember that guest opinions are their own. And if you require specific legal or tax advice, or advice and any other specialized area, please consult an appropriate professional and we also very much appreciate you reviewing the show. Please go to iTunes or Stitcher Radio or whatever platform you’re using and write a review for the show we would very much appreciate that. And be sure to make it official and subscribe so you do not miss any episodes. We look forward to seeing you on the next episode.

Archive