Growing up, my mom was a stay-at-home mom and seeing her manage our household made me envision a similar future for myself. She led every aspect of our home with precision, except when it came to our finances. With a good job, my father assumed the role of provider for our family while my mother remained completely reliant on him to make financial decisions and investments. So when he left us, we lost everything.
Fast forward to decades later, and, despite women being more educated, and leading accomplished careers and profitable businesses than ever before, many women are still not fully in control of their financial lives. As the caretakers of our families and communities, we can’t afford to be passive participants in our financial decisions or delay jumping into the investment arena. Like my mother, it can put us at risk to be in such a vulnerable position, especially in situations where a divorce occurs, your spouse passes away, or your husband chooses to leave.
Whenever I tell people what I do for a living, people (especially women) feel compelled to share their desires and fears of getting into the real estate investing market. Women often declare that their husbands handle the finances because he is “better at it.” Others tell me that when it comes to investments, they believe that money in their bank account is their smartest bet. Some confess their decision to wait until they get married and are able to buy real estate together with their partner.
1. Begin By Preparing your finances
My response is always the same. Real estate investing is one of the most time-proven methods to achieve financial freedom and stability. I encourage women not to wait until tomorrow or years later to get started. Our future depends on it.
Have doubts that it’s possible? Just look to the 65% of millennial single women who aren’t postponing this major life decision (and investment) until they get married. In fact, single women now own more homes than single men in the largest metro areas across the country. Women can do hard things on their own and position themselves for financial freedom, and the research proves it. Investing in real estate early can be a transformational decision that will help set you and your family up to build generational wealth.
The only way to boost your confidence in making this significant investment is to get started.
Despite misconceptions that women make more impulsive purchases, data shows that women are often more financially savvy than their male counterparts when it comes to credit cards. To purchase a home, your personal credit score should be as high as possible to ensure you have the best leverage with lenders. To prepare yourself financially for becoming an investor, you will need to manage your money with purpose: avoid lifestyle creep as you earn more, live within your means and be diligent about automating bill payments to avoid late payments.
Once you have raised your credit score, the next step is to be strategic about qualifying for business credit to buy real estate.
2. Start Small
Know that your first property investment may not be (and probably shouldn’t be) the sexiest one, but it is what will help get you in the market sooner. Buy what you can afford now. Consider purchasing a home that is a fixer-upper to lower the risk of it surpassing your budget.
Sometimes people avoid fixer-uppers because renovations can be a challenging journey to work with contractors. Yet, it doesn’t have to be a lot of work. Instead of waiting for the perfect place, buy something that’s close enough – perhaps it will need new paint or require repairs to things that are not working properly. Focusing on a starter home will help you in two major ways. The price to buy it and renovate in many cases will be less than the cost of a house that is in optimal shape. Plus, a starter property will qualify you for a fix and flip loan which provides the capital to fix the house up and either move in or rent it out.
Don’t go all-in with more than you can handle. Take an informed approach to your investment strategy based on all that you have learned and then take the leap. A major purchase I made early on was the block of homes I bought circa 2012. That real estate investment is what I called my “retirement package” because when I closed on them I just knew I had to keep going. I resigned from my job three months later. And I did this while pregnant!
We all have an ideal life. Yours may be to stay at home with your kids when they are young, to have the ability to enroll them in the best schools, or to have enough cash flow to work for yourself. Getting started with investing is a character-building experience that will also be the key to freedom and security.