New Investors Beware: Real Estate Education can Cost Big
Don’t lose $24K the way this man did…
It’s sad, but I sit down with individuals on a regular basis who have spent $20,000+ on guru real estate education and they still don’t have all the tools to properly invest. I just spoke with a man who, after spending $24K on boot camps and seminars, is at the end of his financial rope and still is unsure how to properly invest (which is why he contacted me). I wish he had contacted me first.
You would think that $20K worth of any education would be enough to get you going, but if you read what I’ve detailed below you’ll understand exactly what went wrong (and how you can avoid this yourself).
This is an excerpt from “The 7 Great Lies of Real Estate Investing” on how the gurus operate. I’m releasing this information because, regardless of whether you ever buy the 7 Lies book or not, I want you to understand what you’re getting into when you attend a free guru seminar at your local hotel. This will save you a lot of time and money…
The Guru Experience
Many people, realizing they need education to succeed in real estate, turn to any number of real estate professionals who sell real estate investing education. These professionals are often collectively known as the “real estate gurus”.
You can spot a guru by their mode of advertising and selling. You may see them on web sites or late night television selling CDs and DVDs about real estate investing. They often travel the country delivering seminars and boot camps. When one of them is coming to town you’ll see full-page newspaper advertisements and commercials on TV inviting you to attend a free (or nearly free) workshop about how to make millions in real estate investing.
These workshops sound like the complete package because they use a combination of the 7 lies to bring you in, each of them promising to teach you what you need to know to start creating wealth immediately.
I enjoy going to these workshops. They are, if nothing else, very motivational. Are they a waste of time? Of course not–especially not for a beginner. What purpose would it serve a guru to waste your time? These workshops usually have very good information on the reasons why you want to get into real estate investing, they go over fundamentals of investing itself, and they are very effective at giving you the big picture of what lots of money can do for you personally.
They’re a lot of fun. You’ll meet some good people and, unless you’re an experienced investor already, you’ll learn something new. They are very good at getting you interested in starting a career in real estate. Will you know everything you need to know to be successful in real estate after attending this workshop? Not a chance. Even though they said you would? I’m afraid so.
What to watch for
Do you know how you can tell? At the end of the workshop they DON’T say, “Thank you all for attending. You now know everything you need to know to be successful in real estate. Take care!”
No, they don’t say that. At the end of the workshop, what they say is “Thank you all for attending. We hope you’ve learned a lot. Now if you’re ready to make a lot of money in real estate, you’ll want to sign up for our 2-day seminar happening next month at this same location. It’s usually $9,500 but today we have a special price of only $3,000 for the first 100 people that sign up. At this seminar we’ll teach you (insert very impressive sounding subjects that you realize you need to learn). If you’re serious about making money in real estate sign up for this right now.”
Now they’re usually a lot more persuasive than that, but if that’s what they say then you know you haven’t been taught everything you need to know to be successful in real estate.
You’re not done yet…
So a month later they come back to town and you attend the $3,000 seminar. You learn a lot of good stuff and you’re getting a clearer idea of how to do real estate. You’re feeling more confident but then at the end of that seminar they point out that you are totally lacking knowledge in the area of (insert another important area you need knowledge about). Luckily they’ve got a 3-day $5,000 boot camp coming up in 2 months (discounted from $12,599!) that covers that exact topic. They’ll take good bit of time to lay out very clearly why you would be nuts not to attend this boot camp.
So you spend $5K to attend the boot camp, and it was fantastic! You’ve learned some awesome things and you’re excited to get going until they tell you several horror stories about new investors who used this information to do a real estate deal, and everything was going fine until something unexpected happened and they didn’t know how to complete the deal and they lost tons of money. If you don’t want that to happen to you, there is a $4,000 package you can buy that allows you to speak with a personal investment coach twice a week for 3 months so you’ll be able to solve unexpected problems that will inevitably pop up.
So with the coaching program in hand you’re ready to boldly go out and invest–right? Your coaching sessions are going well, but then the coach can’t stress enough that you need to attend the upcoming 2-day $2,500 workshop because “it’s essential to making money in real estate and it would be a mistake of gargantuan proportions to miss it.”
So in this situation you’ve spent $12,000 on education with a lot of good reasons to spend another $2,500. Has it all been a rip-off so far? Not necessarily. You’ve learned some very good things and you now have a much better understanding of real estate investing.
Do you know how much more money you’ll need to spend with them before you feel confident to start? No–each seminar you go to promises to give you the secret to unlimited wealth, but each one ends with another up-sell.
Should you quit? By this point you’ve invested so much into this that it’s hard to justify quitting now.
Have you invested in real estate yet? Maybe, but it’s unlikely that you have.
The Guru Dilemma
You see, there is a natural dilemma here. The gurus stop making money from you the moment you feel that you have everything you need from them. Gurus are traveling salesmen, and out of necessity their system is set up so that after they’ve taught you something it is in their best interest that you still feel like there is more you need to know to be successful. If, at the end of a seminar or boot camp, you do feel you’ve got all the information and tools you need to invest with confidence, they haven’t done their job correctly.
So, continually feeling that you’re lacking something vital, you’re inclined to postpone action till the next time the guru comes to town. Because the fact is, and this is key to their success, you ARE lacking something vital. The gurus HAVE left out important information. They do this so they’ve got something that they can create another boot camp/workshop/seminar around.
Can you see why people can spend tens of thousands of dollars learning about real estate but never have the confidence to go out and do it? Can you see how there’s over a 95% failure rate? I’ve actually met someone who has spent $60,000 on education but hadn’t invested in anything yet. Some people spend so much time and money just trying to learn what they need to know that there’s often no time or money left to get started with!
The gurus do, I am certain, sincerely want you to be successful in real estate. They’re not the bad guys here. The simple fact is that they are the ones who built the real estate educational system and they built it in their favor. It’s a business, they’re very good at it, and they’ll use whatever words and promises they need to get you into their system and keep you there as long as possible.
Is this a sad state of affairs? Yes. Do a lot of people give up before they get started? You bet. Is there a better way? Absolutely.
Let’s get into it…
This is only the beginning. This isn’t the only way that gurus operate–there are more things to watch out for, other tactics to be aware of, and additional tools of persuasion that gurus employ to entice attendees to buy their education.
Don’t get me wrong–I don’t hate the gurus. They do, in many ways, fill a necessary role. I just don’t approve of their sales and marketing tactics because they’re usually not up front about things and often tell outright lies to get people to buy their programs. Those lies are the basis for “The 7 Great Lies of Real Estate Investing” book that this excerpt was taken from.
You can get great education through the gurus if you know how to find it, know what questions to ask before you buy, and know how to see through the sales tactics and hype. I’ll teach you all of that.
When you’re at that stage where you’re considering buying education, please grab a copy of the “7 Lies” Guidebook first so you know how to beat them at their own game.
Because I could live happy for the rest of my life if I never receive an email like this again:
I just wanted to thank you for the real report, for answering my questions, & to thank you for being a real person, not computer generated!”