12 Reasons Why Agents Never Maximize Their Financial Success

Welcome back, here we are at Mike Ferry TV. Thank you so much for spending some time with me. My name is Tony Smith, Vice President here at The Mike Ferry Organization, and I'm happy to spend a few minutes with you today talking about something that many people don't talk about too much, right? In fact, it's a bit risky.

You know, Mike has said in the past before that whenever this topic comes up, some people shut off mentally, they shut off physically. Hang in there on this one, okay? So, the topic that we're going to cover today are the 12 Reasons Why [Real Estate Agents] Never Maximize Their Financial Success, the 12 Reasons Why People Never Maximize Their Financial Success. If I say “people”, I could plug in the word “agents”. 12 Reasons Why Agents Never Maximize Their Financial Success.

And we have to look at this because I'm going to take a big, huge assumption today that you are … I assume that you want to be financially successful. And if you want to be financially successful, if we take a look at the reasons why people don't and you're very diligent about changing that for yourself, will you then enjoy the financial success that you want? Let's face it, in today's world, with the prices the way they are and commissions on the rise, the success rate of listing selling today we've been in this window of time that you can make a lot of money. Well, if you're going to make a lot of money, it's the pathway to financial success, isn't it?

So, let's take a look at these. And what I'd ask you to do is consider these for yourself and think very personally about it. Do any of these challenges, these reasons, apply to you at all? Because if you can flip these over, then you'll achieve more financial success in your business, in your life. And I'm hoping that's the goal.

I remember receiving these points from Mike on a group call. There was a Mastermind Group call and Mike shared these points and I wrote them all down and typed them up. This has been 15 years ago, and I have to tell you, it was very impactful to me because I was literally doing all these things wrong. And so, it shifted things. I hope that can do that for you, right?

So, let's look at these reasons. The first reason why people don't become as financially successful as they could is, they don't set strong financial goals. They don't set strong financial goals. How strong are your financial goals right now? You know, we ask agents all the time in Coaching. We say, “Hey, could you create a little three-year financial plan for yourself? How about a five-year financial plan?” And man, there's times where we have to pull and push and prod and to pry that out of you, to get you to put down the goals. Why is that? Are you good at setting strong financial goals? Three years out, five years out, ten years out? Where do you want to be?

Number two on the list. They won't define what financial success means to them. So, the one reason that people aren't as successful as they could be financially is they won't define what financial success means. You know, some years I just want to have all my debts paid and no expenses. Some years I want this huge, massive passive income. Some years, right? And it's all over the board.

Can you define for yourself what financial success means? Is it a net worth goal, a passive income goal? Right? A debt versus income goals that you have. Can you define it for you? What does it mean for you to be financially successful? If you don't define it, how could you ever possibly track it down and hit it? It takes some time. Take some thoughts. Is it possible that what your definition of financial success may change over the years? Very possible. But at the same time, if you don't ever take the time to sit down and define it, it's hard to hit.

Look at number three. They make financial success a moving target. It's a moving target. So, one thing we know is if you want to become financially successful, every money manager and they all talk about the amount of time it takes. It takes time, right? Unless you hit the dotcom world, or you hit the lottery or what are the odds of you having some windfall this year that set you up for the rest of your life? It gets really small, doesn't it? So, you know, financial success is going to take some time.

But then can you imagine that if you're always moving the target of what that means? I want to acquire rental properties and pay them off and have rental income coming in. I want to make really larger and larger and large amounts of income year after year and take a percentage of that and put it into the stock market or into paper funds or whatever you decide to do. But if you're moving it all the time, then you can't ever have the benefit of the accumulation effect, which we talked about last week on Mike Ferry TV. Is your definition. Is it moving? Have you defined it? Are you always moving the target?

Look at four. They've defined success in ways that are impossible to achieve. Right? This is a mistake many people make is they've defined success in ways that are impossible to achieve. And what we've experienced is usually a time. Right? I want to make $1,000,000 by Friday. Right? I've done ten deals this year. I want to do 100 deals this year. And I want to make a million bucks. Right? And that impossible approach to financial goals, all that causes you to do is get discouraged and be frustrated.

You know, you've seen these charts and graphs that a money manager will say, “Hey, if you just put $100 a week in an account and you did that for 25 years, at the end you're going to have this 3 million bucks” or whatever it is, right? Yeah, right. Well, after 20 years. But if you set up some impossible way, if you're always the only way you're inspired is if you throw something financially in front of you that's like, “Oh, that would be awesome if I got that done by Tuesday.” Is it impossible? Check it for yourself.

Look at five. They don't believe they … this is a tough one … they don't believe they can do it, so they never start. Now, I have a challenge with that one because, you know, believing you can make money with the Mike Ferry Sales System, we have virtually trained every size, shape, everybody to make money at a high level.

Mike has spent the majority of his life discovering and presenting to you every imaginable way how to sell a lot of Real Estate and make a lot of income. So, this one just bugs me because they don't believe they can do it. Do you believe you can become financially successful? I sure hope so. We have so much proof of people that are doing it. You've got to start. You know, a race is won by the first step. Are you willing to take the first step? Are you willing to believe what the mind of man can conceive and believe they can achieve? So, we have to work on it. It doesn't matter if your belief isn't there at the second, but it really bothers me if you won't work on it. Are you working on strengthening your belief of what you can achieve in this business and achieve financially? Gosh, you've got to start.

Look at six. They never make an absolute commitment to the success. Commitment. We know that to become financially successful, it requires commitment. And that's a tough word because we know how rare that is today. Well, I'll commit if I can see signs by Friday, right? You know, I want to lose 20 lbs. And on day two, I haven't lost any. I quit. It requires a commitment.

What is the level of commitment you're operating on now to a strong financial plan, financial goal for yourself? It requires commitment. Oftentimes, it requires recommitment. You know, you fall off your square, you get set back. There's an expense that you didn't think you were going to have. And you've got to put a new roof on the house, and it sets you back, right? Well, you've got to recommit. Right? It's so hard to see one little derailment set you completely off track.

Mike has said it this way for years. Agents tend to always dramatically overestimate what they can accomplish in one year, but underestimate what you can accomplish in five. Right? I want to make a million bucks this year. Overestimate. But then in five years, you're making a million bucks a year. So, you have to consider. [Do] you have commitment, challenges or problems when it comes to financial plans?

Look at seven. They never create a realistic plan to follow when it comes to financial success. You have to be able to really commit to a realistic plan and follow it. The key words are “realistic”, “plan” and “follow”, right? Is your plan realistic? Does it have a step-by-step approach to it? Could you pay off some credit card debt this year? Could you increase your income this year and decrease your expenses a little bit this year? Net-net bottom line, you have more money to work with.

Could you start saving a certain percentage of every check into an investment or a savings or a retirement account, if you will, and have that money build up one check at a time and then use that money properly. A realistic plan to follow.

You know, some agents are 55, 60 years old. They start thinking about paying off debt. You've got mortgages on your house and two or three other rental properties. What's the right sequence? Could you create a plan to pay off the mortgages over time? One at a time. What's the right mortgage to pay first? I don't know. But do you have a plan to follow?

Look at eight. They don't execute the plan. Even when great people do plan, the execution of it is the real tricky part, right? If you're following us, you probably have a business plan. I'm hoping you have a business plan for this year's income and sales and Real Estate. Do you have a Mike Ferry business plan? Executing. It's the tough part, isn't it? You've got to be willing to look at that plan each week, take steps, work on the action steps, even if you're failing at times recommit. Do you have a challenge executing the plans you set for yourself? It's something that you can fix, that's for sure.

Number nine, they won't take responsibility for their money. This is people but agents, too, right? Won't take responsibility for their money. Do you know what your expenses are? Do you create a profit and loss statement for yourself? Do you understand a budget for expenses and income? That's responsibility for money.

You know, many people around tax time their business falters a little bit because they didn't prepare for it. And now they have taxes to pay, and you've got taxes to pay … where is the money coming from? Right? And you scramble around and try to come up with more write-offs. Right? … And then not only do you get this bill that you have to pay for taxes, but it sets you back in your business at the same time. So, you're losing income because you're distracted by it and then you still have to pay the tax. Responsibility for your money. Interesting, isn't it?

I wrote down this number. Number ten, they give up when they face a major challenge. Many people don't become as financially successful as they possibly could because they give up when they face a major challenge. Now, is it safer for you to just dream that you're not going to have any financial challenge in your entire life? Or is it smarter to approach it that how are you going to recover when it happens?

We're going to have financial challenges. Markets are going to dip. Things are going to happen. You'll have an unexpected expense pop up or something happens that you have to pay for it. That's called “life”. And it's normal. It's going to happen. But are you going to let those things derail you from a three or five-year financial plan? They shouldn't. You've got to jump back in there and go back at it, right? It's interesting.

Eleven, they don't run their business like a business. So many agents don't run their business like a business. They get a check, and they see that check as all their money. I got a $9000 check. This is my money. I'm going to go spend it. Well, there's taxes and there's business expenses and all those things out of it. So, if I see this check is all my money at the end of the year. I don't have any money when it comes to expenses that I have. So, running it like a real business, right? You're going to hear that from Mike Ferry all the time. It's a big part of what we teach here at MFO.

And then twelve, the twelfth reason why people don't become as financially successful as they could is they spend more than they earn. Okay? This is probably a challenge in North America today, right? I earned $70,000 and I spent $85,000 and that difference was on a credit card, right? You know, this is just a common challenge with people but are you pretty good at being a really … you have to be very, very conscious and very disciplined to spend less than you earn.

You know, everybody says, you know, take some money out of every check before you pay your bills and put it somewhere, right? Take the leftover change in your pocket and put it in a jar. You know, don't go to the ATM and take out 100 bucks because you spend 100 bucks every time you have it on stuff. You don't even know what happened. But are you conscious of your expenses versus your earnings? So, think about this. This is a little bit of a challenging topic, I know. But I also know that everyone watching here today wants some level of financial success, and you can have it if you turn all of these rules around, if any of these little failures apply to you, if you can fix that, are you in essence, then moving towards financial success faster? We think so. Thanks for your time here today on Mike Ferry TV. I hope this helps.