Monday, January 5, 2009

Increasing Income

My company has announced no raises for 2009 and no bonus. I have to make an extra alimony payment to my ex-wife out of a non-existent bonus and I usually use it to pay down on debts. Like many people I either need to increase my income or cut expenses. My expenses are pretty barebone right now, so there is little to cut

What do I do now? Invest in more real estate? Take a part time job? Find another source of income?

Is the real estate market at a bottom yet? Probably not in the hot markets of the past few years if you look at this graph. The market neither increased rapidly nor dropped in the Buffalo area (it's up 4% in the past 12 months). Underwriting for investment loans has become very strict the past year. If I could get a real estate loan, I would re-finance one of the properties I own that has a variable rate loan. I just cannot see any purchases of real estate at the moment. Besides, cash flow from my properties is revenue neutral and I wouldn't expect that a heavily financed purchase would produce a positive cash flow.

I mentioned here and here about my experiences with multi-level marketing through Amway/Quixtar (I read this weekend that they are now dropping the Quixtar brand and reverting to Amway). I don't really consider Amway an option due to the high people skill requirements for success.

I "tried" the Internet with this blog. But my 25 months of blogging has earned me a cumulative $2.46! Of course, I do not have a good sense of how to make money on the net. One of the aspects that I really grasped with Amway was the "franchise" concept (see point #2 here). Distributors like Dexter Yager had created an excellent "system" for success.

As I mentioned a couple of posts ago, I have been looking into SiteBuildIt. It seems to me that the creator of the site has done a pretty good job of building a good system that can be followed by most people. The system looks pretty comprehensive. If you are (like me) uncertain what type of Internet business to create, there is a Brainstorm section which provides lots of data. You can use the data to determine supply Vs demand for any particular keyword (i.e. business idea). His C-T-P-M model makes a lot of sense (and points out why this blog doesn't make much money!).

I am applying for a Census job and have thought about taking a second job. The problem with second jobs is that they have little flexibility. Since my boys have not been willing to get their driving licenses, I still need to do a lot of chauffeuring.I thought about becoming a Real Estate Agent and took an on-line CCI - but, as I suspected, the competencies needed are much like Amway and I scored in the lowest 20%.

So, over the next few weeks I will explore a web site in more detail and may pursue that for the time being.


IBOFB said...

Hi Paul,
Interesting post. I note your comment "I don't really consider Amway an option due to the high people skill requirements for success"

If you read books about research into the area of success, such as Malcolm Gladwell's new book "Outliers" or Robert Holden's "Success Intelligence" you'll find that in pretty much every area you can think of, once you're smart enough (and that's not that smart), then things like people skills and persistence are what makes the difference between success and failure. It certainly the case in the business owner world, and anyone who has ever conducted interviews for prospective employees can tell you it's the case in the employee world - a CV gets you to an interview, people skills get you the job.

The good thing is these are skills not talents. You can learn them and improve them. Some folk have it come more naturally than others, but anyone of sound mind can learn them. Heck, my branch of the Amway world is chock full of engineers - not exactly the profession best known for people skills! - but they are extremely successful because they made the decision to learn skills like how to deal with people.

Worth doing no matter what field you decide to pursue. Some recommended reading -

* Skill with People by Les Giblin.
(a very small book with all you need to know!)
* Personality Plus by Florence Littaeur
(I have graduate qualifications in psychology, yet learned more about people from this book!)
* The Five Love Languages by Gary Chapman
(Read this and it will make a huge diffence in dealing with your teenagers!)
and of course the classic -
*How to Win Friends & Influence People by Dale Carnegie.

Best of luck!

Paul said...

Thanks for the comments. I've read every one of your recommended books several times. Is it a skill or is there something about certain people that "clicks" and they connect with others. I've watched many people in Amway seemingly change - but I think that these were people that had that trait and the books just helped them overcome their fear.

I had no fear of cold calling people. I just could not connect afterward in a timely manner. All the techniques I learned were artificial for me and people sensed that.

IBOFB said...

I think it comes down to motivation. If you're thinking of "techniques" then you're really trying to get someone to do what you want. True skill with people comes when you're sincerely interested in the other person. In network marketing it's the difference between trying to get people to join/buy because you think it will make you reach, and trying to get people to join/buy because you think it will help them. You're doing much the same things, the same "techniques", but the motivation changes perceptions dramatically.

The latter is what gives that "connect" - you're sincerly interested in them. There are skills you can learn to do that, but sincerity is an attitude, and attitudes are things you decide to have - though it requires practise to keep them!

Paul said...

The old line your parents told you that "you can do anything you want" is not really true. You can do more than you think but some people are gifted in ways that make them successful in certain fields and not others. I happen to think Calculus is trivial, but could never succeed in the NBA. Likewise, some people have a gift with people.

IBOFB said...

I think folk who have "a gift with people" simply learned the skills at a younger age and have the confidence necessary to use them. Confidence is again something some have more naturally than others, but it can be learned by anyone.

Are there folk that have an "advantage" because of this? Sure, but anyone can learn the skills, and anyone can develop confidence. It might be easier for some than others, but that doesn't mean it can't be done.

My upline in Amway is a Founder's Crown Ambassador, and an engineer. As it happens we went to the same university and I once encountered someone who knew him there. Apparently then his people skills were more than lacking! He learned them, and learned confidence. This isn't an unusual story. What folk tend to see are the polished Diamonds, who've on average spent about 10 years getting to that level (matching perfectly Gladwell's thesis on 10000hrs to master a topic - not talent) or the new flash in the pan stars that grow fast thanks to some natural charm. The latter tend to not even be around 10 years later, natural talent may give an advantage at the start, but it's the hard work learning the skills that develops long-term success.

Indeed, the same thing applies in the NBA. There's probably plenty of folk who have more raw natural talent than Michael Jordan playing hoops in the back streets - but he put in the hours to learn the skills needed to succeed at the highest level. Talent only gets you so far. Still, to play NBA there's probably some point where you have to have "enough" talent so that hard work can make a difference. From my study of Amway (and I've been studying it a long time, not just as an IBO) and successful Amway leaders, "talent" is not a prerequisite to success. Anyone who is of reasonably sound mind has "enough" talent - much of the rest is putting in the hours. I'd add one proviso to that. Gladwell talks a lot about various serendipities for the most successful people - they were essentially the right people, but also in the right place at the right time. With MLM I think there is a similar thing that occurs - whatever group you join, even within one company like Amway, is important - it has to be the right people for you, otherwise the task becomes far too hard for most folk. I for example would never have lasted in the Yager organization, whereas others find it a strength.

Other than that, if you yourself have a talent, and you enjoy it and and it's marketable, then that's an area you should be investigating further. But to make money from it, you have to "sell" it. And to sell it ... you need people skills, even on the 'net.

Unknown said...

Paul,I guess commentors realize you have already gone down that Amway road previously(?).I really wish you would do a wrap up on how your various properties did/are doing just for the entertainment value. This is not a putdown by any means. It's just that you worked so hard and posted regularly on how things were going, then you go into engineer-style posts (yawn)when you've got so much to give(i.e. writing about your experiences.)I am not putting your engineer skills down; I am in awe of anyone who can do that type of work. Did your properties come out in positive territory for 2008?Did you get any sold? Such topics, although I can't see how they would fill your coffers, would be interesting. Who knows, maybe you could get job leads. Unless you've figured something out which you could sell, you must be getting older. Are you being given the gentle nudge toward the exit door? Maybe you could get a buyout, pay off your properties, then go into a new career. Find a need and fill it. Nobody I know needs any more cleaning products.
Who knows; the best may be yet to come. (I space out on your engineer-style topics, so I might have missed a few posts and you might have updated your real estate endeavors. Sorry if you have.)

Paul said...

Yes, people are on edge concerning jobs here. We had one lay-off last month which I fortunately made it through. Unless the economy improves quickly, I expect that there will be more.

So, I feel intense pressure to generate a second source of income. My real estate investments are revenue neutral, though I am sure I will show a large loss in my tax returns. None of my tenants are buying and one is being a real pain about paying in a timely manner.

As to IBOFB's comment, anyone cannot be successful in sales (I bought that for many years when I was in Amway, but came to different conclusion after examining the data). The reason professions like sales provide such a good income would seems to make that obvious.

IBOFB said...

My original point wassn't really supposed to lead to an Amway discussion - more that your reasons for dismissing Amway would apply to virtually anything. People skills are necessary for long-term success in virtually any field, not just sales. The research supporting this conclusion is pretty overwhelming.

So if you honestly believe people skills are actually "people talent" and you can't learn them, then you must resign yourself to never reaching great heights.

Alternatively, consider that people skills are indeed skills, and can be learned, and then learn them and apply them in whichever field suits you best.

Paul said...

I don't think anyone is disputing your point that people "skills" are important for success. However, I believe that the word "skill" here is somewhat misleading. Obviously, anyone can improve their skills in any area. I can learn to play basketball better by practicing 10000 hours. But I am not tall enough to ever make big money at it. Likewise, you can be better at math with practice. I used to get really upset with people that struggled with math (like my kids). But they are not wired like me.

My company hires 95% engineers. I believe that the ones that climb the management ladder successfully are generally not good engineers. But they have other talents (I use to call it BS factor), i.e people skills. And I believe that the best ones are born with it. Some of my brothers were born talking, social animals.

You don't have to be a good at people skills to sell books or be invent new things. But you can be quite successful at both.

IBOFB said...

Well, I think we'll just have to agree to disagree! I think you don't need people skills to write a book - but you do need them to sell it and make money from it, even if just to sell it to an agent. Similarly you don't need people skills to invent something, but you do need them to sell it and make money from it. The folk without people skills inventing stuff might be making money for their employers, but it's unlikely they're doing as well from it themselves.

I also disagree that some folk are born with this stuff. I remember a fellow at my school when I was 14/15. His people skills were fabulous. A natural? Everyone thought so. I've since found out he'd been reading Carnegie and Giblin etc etc.

He'd learned it.

Just the ability to talk to folk I don't consider a major part of people skills. In fact (as someone "born" with that, ie a sanguine), it can be a significant impediment - we have to learn to control it. Folk with people skills are good listeners, not good talkers.