Risk management other than being regarded as one of the most important business tools also plays a big role in the life of everyday consumers. Predicting risks and taking necessary actions for eliminating them are important for consumers as well as business owners. This article will educate you about different facets of risk management and will also provide information on asset protection, one of the most effective ways of managing risks associated with real property.

Let us begin the discussion by explaining what risk management actually is. It is basically a process that businesses use for identifying risk, assessing its impact on the company’s performance and creating business strategies or financial plans for preventing ill-effects of the identified risks. Risk management holds a significant position in almost every realm of business. Thus you should learn about this special business tool irrespective of the type of business you own.

Businesses use different kinds of strategies or methods for assessing risks involved in their daily operations. They may do so by performing thorough research on rival companies to find out the kinds of mistakes they have performed and how they have managed to prevent those mistakes from hindering the company’s overall performance. Some companies, on the other hand, analyze market trends for gauging whether consumers will like to spend more or spend less in the future. Market trend analysis is also often used for determining the kinds of consumer requirements that will compel spending during the coming years.

Now, let us discuss about asset protection. This tool is used by individual consumers as well as businesses for reducing the effects of risk on real properties like homes, business buildings and automobiles. Experts often refer to asset protection as a risk mitigation tool; this is because this tool successfully reduces the amount of harm the identified risks can cause to the property of the consumer or business owner.

The asset protection type that is used most frequently by consumers and businesses is insurance. You can use insurance in different forms for protecting your assets. You should pick the insurance type depending on the kind of property you want to protect; for example: for protecting your home, you should opt for homeowner’s insurance, for protecting your business building, you will need to buy business insurance and for protecting your vehicles, you will need auto insurance. Insurance policies can also be categorized based on the type of coverage they offer. There are too many options to choose from; thus you should always consult an experienced financial adviser before making any decision.

Why buy land?

“When a parcel of ground is deeded to you and you walk all over it and call it your own, it seems as if you had come into partnership with the Original Proprietor of the Earth” – Henry Ward Beecher

Design Your Life… Master Your Destiny

People buy land for different reasons:

+ they want to landbank their money and invest for future profits

+ they want to build their dream vacation or retirement home in an ideal location

+ they want a place of their own to go camping or hunting

+ they want to build a residential or commercial building and sell it for a profit, or rent it for lifelong income

There are a multitude of reasons why people buy land. But no matter what your personal reasons are, I want you to consider that underneath all of those reasons, there’s a psychological benefit to owning land that maybe you’re not even aware of yet.

Everyone wants to get ahead in life. Everyone would like to have their dreams come true. But there’s a fundamental difference between “Waiting for your gravy train to come in” and “Going out to find it”.

In the first case, if a person is “Waiting for their gravy train” then they’re just waiting for whatever shows up in life. In the second case, if a person is “Going out to find their train” then they’re actively creating their destiny.

Mindset

The difference between each approach boils down to your mindset. Attitudes and beliefs about how life works and what is possible to achieve in life constitutes your mindset or as some call it, your Inner Game. Outer Game consists of all the actions you perform to accomplish your goals… i.e., get up, go to work, make sales calls, close the deal in order to get a paycheck at the end of the week. You can work on your Outer Game by becoming more efficient, organizing your tasks and to-do lists, outsourcing the menial stuff, etc., etc., etc. But no matter how efficient and razor sharp your Outer Game is, if you mindset isn’t right… then it’s all for naught.

+ Inner Game determines how successful you’ll be after doing all that Outer Game stuff.

+ Inner Game determines if you will “Wait for the train” or “Go out and find it”.

+ Inner Game determines if you’re waiting for life to happen, or mastering your destiny.

+ Inner Game determines whether you’re open to possibility and a vision of what’s possible.

“Okay…so how do I get my Inner Game on?”

The most powerful question you can ever ask yourself is “What if?”

Start asking yourself that question every hour, every day, about everything you encounter. If you’re interested in finding opportunity and being the master of your destiny, then I’m advocating a simple solution… (1) start asking “What if?”, (2) create a plan, then (3) go out and do it.

Owning Land

Owning real estate is an integral part of mastering your destiny. There’s a certain psychological satisfaction derived from owning property, and specifically land. Owning a piece of vacant land opens the “Doors of Opportunity” and the “Windows of Possibility” in your mind, and it’s like having a combination of 3 things at your disposal:

1. a good insurance policy,

2. a FREE Get-Out-of-Jail card, and

3. a couple of extra aces hidden up ones sleeve… (I’m not kidding about this… you’ll see what I mean below.)

Now, I’m not advocating cheating at cards, or skirting the rules and ending up in jail. I’m trying to illustrate that in life and in business, having a back-up plan is a straight out necessity. But more important than having a back-up plan is just having a plan.

But a plan without any options or opportunity is just a recipe for a lifetime of struggle with no reward. People who own property have options and opportunities that non-owners never see or even imagine.

Creating Opportunity for Yourself Being a landowner is the first step to creating “a place” for yourself in the world. I’m talking about creating opportunity for yourself. That all by itself will give you a psychological edge and that necessary feeling of being “grounded” in life.

“What if” you could build your own dream house in an idyllic setting?… well, buying the land comes first.

“What if” you could build a commercial building in a busy part of town, and then sign a lease for 25 years with your tenant who happens to be the U.S. Postal Service, or Fed Ex, and then collect your guaranteed rent for the rest of your life?… well, I know of someone who did just that, but he owned the land first.

“What if” you could buy a piece of land for a hundred dollars a month at the time your child is born, and then sell that land 16-18 years later and have enough money from the sale to completely pay for your child’s college tuition and expenses?… well, it’s easy to do and I know people who have done just that too.

LAND is your vehicle… imagination is your fuel to make it go. Your ultimate destination and how far you get depends on how much you’re willing to imagine, and ask yourself that all-important question… “What if?”

“What a man has to do to become rich in America is find out where people are going,… get there first,… and buy LAND.” (Quote by Douglas MacArthur)

“LAND is the only thing in the world that amounts to anything. For ’tis the only thing in this world that lasts. ‘Tis the only thing worth working for, worth fighting for — worth dying for.” (Quote by Margaret Mitchell)

“It is a comfortable feeling to know that you stand on your own ground. LAND is about the only thing that can’t fly away.” (Quote by Anthony Trollope)

Buying property is easy. Well, it can be a bit stressful admittedly, but its essentially not a difficult process in theory. Buying Investment property, buying it regularly and buying well as a business CAN be difficult however. Here are the 7 biggest mistakes investors make and ones that you should avoid at all costs:

1. No Strategy

Having your strategy prepared is not a luxury step that can be skipped or done later on. If you haven’t finalised your strategy then you really need to do this first because it is pivotal to everything – from what you put on your business cards to how you organise your time, to whom you should be networking with. Then your next priority should be to look at your strategy and write an action plan of how you are going to implement it.

2. Analysis Paralysis

Simply spend too long analysing deals and being too afraid to dip their toes in the water. Sometimes this is because of an inherent underlying confidence issue but sometimes it is just that property is the wrong investment vehicle for their risk profile. It’s action that propels you forward and you will probably learn more from the mistakes you make than what you do right!

3. Do Not Keep to Their Strategy

Having and keeping to a defined strategy can avoid wasted time, energy and money. If you don’t follow your strategy you can be easily tempted to pursue a really good sounding deal – and it may in fact genuinely be a really good deal. But the key question is whether it is a good deal for YOU? The wrong deal WILL cause you problems. Your strategy acts as a point of reference to keep you on track in everything you do – ask ‘is this deal/action/time spent in line with my strategy?’

4. Want To Make A Quick Buck

Property Investment is generally more of a long-term investment and whilst it is possible to make a quick buck with luck and the right contacts and strategy, it is the exception rather than the rule.

5. Focus on being busy instead of doing deals

All too often I hear of investors who ‘busy themselves’ with all sorts of ‘activity’ to get their business started. But that’s all it is – busy-ness for the sake of making them feel like they have moved forward and taken action. The truth is investors do these things from the off because they are EASIER than starting to get out there and look at deals and talk to vendors etc.

I would argue that until you know you have a viable business, you simply don’t need to appoint an accountant, decide on the company formation or set up bank accounts. Do your first deal or 2 and then decide if the business is for you and how you are going to work it.

6. Spend forever on ‘getting marketing in place’ instead of getting started

I’ve seen too many new investors get bogged down in at the start. They spend literally months designing and printing leaflets, sourcing leaflet droppers, pricing up classified adverts and trudging through estate agents doors. This is all fantastic and necessary to build your business. But it should also be balanced with taking action to get straight on with learning the nuts and bolts of the actual hub of the business – assessing leads and turning them into deals. The amazing thing is that months of marketing activity is all geared to finding a motivated seller – yet you CAN do this from day one and what’s more you can CHOOSE which motivated sellers to deal with rather than whatever lands on your desk – its called ‘buying leads’

7. Give Up

Like anything in life, buying property for profit takes work and effort. You were probably in the wrong place in the first place, but if you truly believe that property is the vehicle for you then identify where the blockage was and see if you can outsource the part(s) of the process to others or find a joint venture partner to work with.

(c) 2008 John Rattigan