I wanted to get some feedback from others on this subject.
Was it harder for you to make your first Million dollars or
your second Million dollars and why?
What do you do to earn it and what strategies did you employ? :huh
My opinion is that starting from scratch and building a business is a LOT OF WORK, especially in the beginning. Therefore, my vote is that the first million is much harder than the second.
Once your business grows to a certain point, you reach a point where deals come to you without much (or any) additional effort or expense. In the beginning of the business, the new investor must do something to get deals: advertise, farm an area, meet people, etc. Once you get a reputation for being able to close deals, people will search you out and deals will come to you. Therefore, the first million is definitely the hardest.
This is especially true if we’re talking about net worth. To get the first million of net worth, it will require buying, finding, financing, rehabbing, and renting many properties. However, once you have enough properties to have a net worth of a million dollars, all that is required to obtain the second million is time. Keep the places rented and over time the tenants will provide the second million as the mortgages are paid down. In fact, even with modest appreciation, time will also take care of the third million.
Mike
I have yet to make my first million, but I am extremely (and I mean extremely) close. However I tell you this…based on everything I’ve read the first million is the hardest - exactly as Mike says. I even recall that from one of the Rich Dad Poor Dad books…Robert quotes his rich Dad saying that.
Also logically & mathematically, it makes sense. Starting out - say you have $0 in assets making you NO money, and $50k in earned income (from a job)…you have to build everything from scratch. Down the road a few years if you have $1,000,000 in assets making you $200,000 per year in passive income…and you can live off $50k-$75k (leave $25k /year for a few extras + a BMW 5-series, LOL)…that leaves you a lot more money and leveraged borrowing power to buy more assets with.
With basic financial management skills + a lot more income/assets than required to live, it’s almost impossible not to make more money faster even if you’re in higher tax brackets.
I am a buy and hold guy, and have been since 1981.
In my case, if we are talking about net worth, making the second million was just as easy as making the first. The second came faster than the first, but the difficulty level was the same.
The hard part was just making the first dollar. Once the systems and the investment criteria were in place, it was just like driving on cruise control.
Wow, what a topic. I’d be happy just hitting 6 figures, much less 7. :anon
I’m not there yet but I’m pretty sure once I get there, the 2nd time around won’t take as long.
Mike very solid thinking thanks for your most valuable input.