One of my tenants is 23 days late with rent, and it isn’t the first time. Too bad the bank doesn’t allow me to extend the grace period for my mortgage to another 23 days. Life is tough, but hey, it happens. Do I want to scream at them? Yes, of course. How dare you live at my property and think it’s OK to pay 23 days late. I provide you with a roof, you provide me with a check. It’s that simple, why does there need to be any complications?
I got off the phone with my property manager this morning, and thankfully the tenant just paid today, so I should see the money in my account tomorrow. This experience reminded me once again one key aspect of investing: keeping the emotions in check despite whatever issues may come up.
Regardless of how smart you may be, if emotions take you over, rational logic is the first thing out of the door. We act out of fear that we’ll lose something. We panic, shake, and before you know it, we make a decision we regret. How many times have you sold a stock when you saw it going down?
I just kept it cool. I didn’t call and scream at the management team. I followed up politely. I know that the state laws here are in favor of the tenant. They know the laws and how to handle it so investors get the maximum returns. So ultimately, I know I chose them for a reason. The team has an innate sense of responsibility to their clients and they know their stuff, thus I trust that despite any situation they will do whatever is in their power to keep the assets profitable. And if there is a problem with the staff, all it takes is a phone call to the owner.
I could have easily lost it. It’s not uncommon for an inexperienced investor to call and scream at the management team. But what good is that? People don’t like to be treated horribly or unfairly. It’s important to give business partners a chance to do their jobs.
So if you ever feel an emotional urge to take drastic action on an investment that isn’t not performing as expected, take a step back and breath. It’ll be ok. Do things when you’re not agitated. Waiting one more day isn’t going to hurt. You did your homework and you knew this is a potential pitfall of your investment. Let the contingent plan take its course, because that’s why it’s there.