ABC's of Investment For Women 2

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I was receiving many flyers in the mail on "equity loans." By now it was 1999 and the stock market was going haywire. Houses were being bid up and multiple offers on homes were common. It was in the middle of a bidding war on who can pay the most to purchase a listed property. I wanted a "House" as I was tired of my little condo.

My friends who had bought homes 5-7 years ago were very glad they had bought at the right time and the properties had gone up so much now. I was wondering if I was doing the right thing by even attempting to buy a house when the prices were so high. I had not made any money in the stock market but was sitting on two condos with significant appreciation. I borrowed money or "equity" from one condo and came in with 20% down payment on a brand new house, competing against eight other bidders. I had just made a huge purchase at the peak of the stock market and was nervous. "What if I lose my job?" Worst case I would sell the condos and pay off most of the loan, I realized I had an exit plan but not a real strategy.

In the past ten years I have added properties in California, Nevada and most recently in Bangalore, India, where people again say what they said 5 years ago in Silicon Valley. "This is a boom in Bangalore and who knows how long it will last." I don't know the answer either and only time can tell. But what I do know is 10% to 15% down payment can buy you a property almost anywhere in the world and renting all these properties and maintaining them is not as hard as people who don't own make it out to be.

I have helped several people in the past few years buy their first homes and rental properties. I even flew with a close friend to another state, at my own cost to help her buy a rental property early this year. The first one takes handholding and encouragement and then it becomes easy. I have little money in the stock market and 401k, but don't see how they could grow to be sufficient for 30+years of livelihood after retirement.

For the past year or two I have met several people for lunch or coffee, most of them are friends of friends who don't know me, but want to know how and where to buy real estate. Almost all of them have attended many investment planning seminars, real estate seminars or have even paid several hundreds to financial advisors. They are skeptical even meeting me as most of those seminars have not had any content or real advice they could take home, at least I don't charge! The only real advice is what all real estate investors give; the three most important criteria for buying a property are "Location, Location and Location." Even if it is an ugly house on a huge lot or a huge house on a tiny lot, it has to be in the best of neighborhoods. Safety, good schools and quiet streets are always winners and even if the market goes up or down, the cycle will pass and you will ride out the lows. The next fifteen, twenty or thirty years, whatever the term of the loan may be, someone else (renter) is paying it for you and in the end at retirement, it will be a fixed source of income you can count on.

Last weekend, driving back home from a motorcycle race in Laguna Seca, my cousin said, "People come to you for advice now, and you seem to have a number of properties, but really, you are lucky you bought the first one. You didn't buy it with a plan to build a portfolio, you bought it because it was cheaper to own than rent." Well, he has a point, but I have always seized an opportunity when I saw one and have not counted on 'luck.'

I bought a medical supplies business recently using equity from one of my properties. I fought my battles with my husband to do this. "You are taking a safe investment and risking it on something you don't know anything about. You have a full time job, properties to manage and why do you need a business?" My simple answer, "Well, I didn't know anything about real estate before either." I owned most of my properties before my marriage and can borrow on them without my spouse's consent. Although in California, the spouse does need to sign a form saying he is aware of the loan. My husband ultimately buys into my arguments and supports my decisions, he knows by now I will follow my heart and convince him one way or another.

Women need to 'Justify' a lot more than men when we want to follow our dreams. In-laws, parents, friends who ask too many questions and put us in a defensive position and more often than not discourage us from taking risks of any sort. Perseverance and hard work win in the end. Hang in there and repeat yourself until you are heard and don't let any one discourage you from following your gut instinct. They say you will never win a lottery until you buy one.

Moving forward in this century fewer women are financially dependent on their spouses and in many cases do not have spouses. Many women I have known have chosen to marry in their thirties or not marry at all and are independently wealthy by the time they are married.

My two cents of advice for women: Make the right investments and plan for a secure future. Along the way live a good life and do not sacrifice the quality of life worrying about the future either, today has to be lived and tomorrow will come but will not take care of itself without a plan.

While at it, do not forget that there are many less privileged people than you and me in this world. Be it a Shankara Eye Clinic, ILP, Mother Theresa's Missionaries of Charity, Maitri or Little Sisters of the Poor (some of my favorite causes.) Find a cause you feel passionate about and year after year look at your portfolio and set aside a percentage and reach out to the needy. The feeling of giving is a natural high and the more you give, the more elated you will be.