If you decide to start your own home-based business, that’s great. But, before you do that, you must know several important things to do this the right way. There are many resources available on the internet that you can use to help you learn from other successful online business owner. If you don’t know any technical stuff to build your business, don’t worry about that. There are many companies that will help you do all the work for you when you join them.I will give you several step by step guides to build your home-based business.1. How To Choose Your Business.When people want to start a business, no matter it is online or not, they must choose what kind of business they want to run. If you only in a tight budget, you can join with a company to sell their products to build extra income at first. This is the easiest way to start your business immediately. But, in the other side, you can also start your own business by selling your own product. The important thing that you must remember is choose a product or service that you enjoy selling it. If you try to do business that you dislike, you will find it hard or even impossible to become successful with that business.There are several home-based business types that you can choose. One of them is MLM businesses. In this type of business, you must build down lines like crazy. This can be considered as a perfect opportunity to earn extra cash for you. The Advantages of MLM business is because it is so easy to communicate with other people. You can start with your own friend. The other ways that you can do are contact any people you know by email and creating your own website. Some MLM companies will help you to contact the people you know and offer the opportunity to them. You don’t need to become an experienced salesperson to do this.When you try to join an MLM business, check the company background and make sure it is a reputable company. This will help you to avoid scams because you don’t want to waste your time and not getting any money.2. Manage Your TimeWhen running your home-based business, you must carefully manage your time. There are many people try to get success without doing anything or spend their time to build their business. This will not make you success at all. If you have a full-time job when you try to build your home-based business, you can spend only a few hours a week to work with your home-home=based business.After you decide about it, you can schedule it. Stick with schedule and be consistent. You must think that you have your very own business and you want it to be success.3. Prepare The Tools This is one of important aspect that you must consider. Prepare a computer with fast internet connection to help you do all the work smoothly. Write your working schedule in your desk to help you stick with it. Choose a place that can help you concentrate with your work and make you think clearly. A place with a lot of noise will make so much distraction for you.4. Money Investment and BudgetingMake sure you choose the right business for you before you invest some money. If you selling other company products, you can save more money, because you don’t need to create your own product. Be careful with your promotion effort. Calculate how much money you want to invest to promote the product with the potential profit you can get from it.Once you’ve chosen the right business to invest in, set up a budget carefully for your business. Get a new account with online payment processor. PayPal is the most popular online payment processor right now. If you apply with an online MLM company, find out how they will pay you and check their threshold.5. Use Your AbilityIf you start working with an MLM company or start a business selling your own products and services, remember to use all your abilities and skills. Maybe you’re a great speaker or a tech geek. Perhaps you know how to create and design a websites, make a banner, or do online promotions. Use your skills to maximize your home-based business profits.

In my years in the foreclosure and real estate business, I bet I’ve met over 1,500 investors. These people have been at all levels of knowledge and experience. Some have become amazingly successful, while others have lost steam or experienced drastic failure. I watched people who are successful and I’ve noticed that there are certain characteristics that come with real estate investing success.

Before I outline the specific characteristics that I’ve found in successful investors, let me define what I mean by “successful investor”. A successful investor is NOT the person who owns the most properties or does the most deals, or who has the most zeros in his net worth. A successful investor is simply a person who knows what he wants – financially, personally, and in terms of what he wants to contribute to the world – and uses real estate investing as a way to get those things. For a successful real estate investor, real estate is a means to an end, not an end unto itself. A successful real estate investor works to become as financially secure as is necessary for his peace of mind and who is happy and comfortable with his investment activities.

Successful investors I’ve known include high school dropouts and PhDs, men and women of all races and backgrounds, people born into poverty and people born with trust funds, guys who started investing at 18 and those who started in their 70′s, part-timers and full timers. There is no single trait that will predict success, but there are traits that I’ve found that all successful investor have in common. Here are a few:

1. Successful investors have a plan – and work it.

It’s pretty easy to work pen & paper and figure out how to become financially independent in 2 or five or ten years. It’s another thing to wake up each morning and do the things you need to do to get that done. Somehow, your real life always seems to get in the way of your long-term goals. Successful investors battle this dilemma to get caught up “in the thick of things” by creating not just a list of goals, but a daily plan for getting there. Every day Lisa and I start with a checklist of things we need to get done that day, but also things we want to get done. Some examples will include marketing, getting letters out, or meeting sellers. What it doesn’t include is swinging a hammer.

Plans are fluid, they are always changing. Just because I plan to do something does not mean I must accomplish that task. I must sometimes alter a plan to meet a new timeline or move its priority up or down on my list because of a new crisis.

The point is that it all starts with a written daily plan that leads me to the end result. My Daily Plan typically starts at 4:30 am and terminates at 8:00 p.m. 6 days per week. Of course there are days I start later and quit earlier, but that is a “normal” day for me.

2. Successful investors network.

Real estate investing must be the only profession in the country that has no accepted curriculum of formal training. Electricians have to be licensed, Realtors have to pass a test, Attorneys have to pass the BAR exam and so many other examples exist. Since your success as a real estate entrepreneur relies SOLEY on your ability to get reliable and practical information & advice when you need it, & since the local community college doesn’t teach you how to evict a non-paying tenant, the only answer is for you to find a mentor who can teach you the ropes from their learning from the school of hard knocks. The “been there done that” school can surely help you keep from skinning your own knees. As Ron Legrand would say, “Been to that seminar”. We are currently evicting a tenant buyer who gave us a $34,000 non-refundable option deposit. Our network brought us the attorney who is doing the eviction. Sure we have an attorney or two that can do the standard eviction. But with such a large non-refundable option deposit and a few other twists in the case, they were a little gun shy. The attorney handling the case now, is so assertive, that one of the plaintiff’s is having a difficult time finding an attorney to take his case. And that all came from networking!

Choose a mentor who is knowledgeable, motivating, accessible, and is known for high ethical and business standards. Don’t abuse the mentor you choose by constantly asking for information that you could get from a simple trip to the internet. And don’t forget to thank your mentor by taking him to lunch, giving him gift certificates to his favorite restaurant, and, of course, letting him in on good leads when you find them.

One of my personal mentors is in Upstate NY. We are in regular communication, we try to talk weekly. Sometimes there is a question I may have, but sometimes it is just a quick hello. On occasion I get a lead that is in his back yard. Don’t get me wrong I am not marketing in any way in his neighborhood much less his state! Even if I was located there, I wouldn’t market in his farm area. That just seems wrong in some way. So when a lead pops up in NY, I pass it on to him.

3. Successful Investors Cull Their Herds.

When I was a teenager, I spent time at a family friend’s farm in Wisconsin. Part of his business was the raising of hogs. The hogs were always giving birth, sometimes several times a week. The farmer killed the weak, undersized, and deformed piglets before they had a chance to grow up. I was horrified!

Most real estate investors look at selling their “dud” properties with the same horror with which I view the culling the herd of pigs. They will keep a property year after year despite that it loses money, doesn’t fit the business’s goals, is a management hassle or is in an area that has become a warzone. Successful investors review their portfolios at least once a year, and get rid of their loser properties before they can damage the profits from their winners.

Late last year I bought a condo and a 3 unit building from another investor, who is also Realtor and a Banker. He wrote us a nice healthy check to take over his properties “subject to”. I hated those properties. The tenants in the 3 unit were worthless. They had (I imagine still do) an attitude of entitlement. They were owed by society a place to live, yet didn’t feel that paying me was a priority. It took about 2 months of that attitude to wear on me. Sometimes tenants think they can steal your property and hold it hostage and get away with it for free! We got rid of those properties pretty fast. Dump the dogs. I have children to give me grey hair; I don’t want my properties to do it to me. You will buy properties you wish you never would have (everyone I know has), just recognize them, dump them (maybe for a loss), move on, and stop crying over spilled milk. As Ron Legrand says… Go milk another cow.

4. Successful Investors Protect Their Assets.

What’s the use of building a huge real estate portfolio if a single lawsuit could wipe it all out? Why bother to achieve financial independence if the bulk of your estate will end up in the hands of the government when you pass on? And why is it that the average real estate investor does absolutely nothing to reduce their #1 yearly expenses – taxes?

If you chose to make investing a career, you will be sued one day. It is not something I look forward to, but it is a reality. Even if you enter into an arrangement with perfect intentions and honorable heart, someone will view you in their sights as a payday. You don’t even have to do anything wrong to be sued! Arranging your affairs to protect your assets from creditors, plaintiffs, and the taxman is tedious, expensive, complicated, and time consuming. Yet every successful real estate investor takes the time and spends the money to do it, thus assuring that their hard-earned money stay theirs and not the victim of a law suit.

5. Successful investors have a code of ethics.

We tend to think of our investments in terms of properties and cash. In fact, the real estate business is about PEOPLE and RELATIONSHIPS. Without sellers, renters, contractors, agents, brokers and so many others, I would not have a real estate business. And since your business affects so many other people, I think it’s important to decide how you are going to treat the people you come into contact with each day.

I read an article recently about Donald Trump. When he was introduced to the article’s author, the first thing he did was compliment the author on something about his clothing. It made the author feels good about himself. Later on when the author saw Mr. Trump rip a contractor who was trying to unjustifiably raise his price, he saw both sides of Mr. Trump, the sweet and the bitter.

Since there is no formal code of ethics for real estate investors, it’s up to each of us to decide how we’ll behave toward customers, tenants, sellers, workers etc. Instead of using as a measure, “what can I get away with?”, or “what allows me to sleep at night?”, perhaps the proper question is, “what’s FAIR?”. Take the time to think about your activities and how they affect people that you come into contact with.

6. Successful Investors Involve Their Families.

I have not yet met a truly successful investor who did not have the support of his (or her) significant other. Because your real estate activities generally involve spending (or promising to pay) tens of thousands of dollars at a time, and since your business will take time away from your family, I think it’s critical to sit down with everyone who’s old enough to understand and explain what you’re doing, and why, and that you’d really like to have their help or at least their understanding.

If you have a spouse who’s reluctant to support you, try sending him or her to a beginner’s seminar. Some of their natural fears may be conquered by an understanding of what you’re attempting to do.

7. Successful Investors Treat Everyone Better than They Expect to Be Treated.

What goes around comes around. If you think that your reputation as a buyer or landlord doesn’t precede you, think again. When you go the extra mile to solve people’s problems, both profit and success will follow.

This week we received a caller from a seller. She was referred to us by a realtor whom I never heard of nor dealt with. How the realtor came up with my name, I have no idea. She told the seller, (her sister-in-law) that she heard we can do deals that others can’t. I didn’t buy the house, it is still listed on the MLS, but she and I will be in contact over time. When that listing expires, I will work the deal out so everyone wins. And when that happens, I will send the Realtor a nice gift certificate so she can take her husband out for a nice meal. I think she will remember us, don’t you?

Some of my best tenant buyers come from my current buyers. And I have had more than 1 seller refer a friend to us. That is the best marketing I can get from anyone. No amount of money can replace that type of marketing.

8. Successful Investors Stay Educated.

Since I began investing in real estate full time, Illinois has passed disclosures for people in foreclosure. There are other laws that exist: the federal government makes lead-based paint disclosures mandatory and expensive to ignore. Congress has rules for capital gains taxes. HIV-positive people have become a “protected class” in terms of fair housing. One city has ordinances that dictate what months that you cannot evict people who steal your property. Mortgage money for high-risk borrowers has become harder to get. The Fair Credit Reporting Act has been revised to include landlords. Things change. Your business may be affected. Stay on top of it and meld yourself.

9. Successful Investors Find The Money Before They Need it.

Imagine this scenario. You found a deal of a lifetime. A property worth 650,000.00 in great shape comes across your desk. It needs just a quick clean job and the grass to be cut. The seller is moving to another state to be with the spouse’s mom, who is going through some health issues. They are going….PERIOD, or the spouse made it clear that their future together would be quickly shortened by their lawyer. They only owe 300,000.00 and just need 50,000 to get moved and settled in. But they want the loan out of their name and they need the cash. Well, a subject to deal is not going to work now will it?

Oil seems to be on every bodies mind a lot lately both in the good sense and the bad sense, but regardless of what one thinks of the oil industry it is the #1 most efficient energy source in the world. And if we didn’t have it we would still be on horse and buggies or riding a bicycle to and from work.

The oil industry has always had a mystical aura about it in the fact that it just appears out of the ground and the thoughts of Jed shooting at the ground in the Beverly Hillbillies and it comes bubbling out of the ground. In reality this is not the case, but it does make for a good story.

I am not going to go into the many different reasons of why oil is a good thing, but I do want to address the bad publicity it has gotten in the area of risk that is involved when investing into the oil industry.

First I want to disclose that I come from a family that was born and raised in Southern Illinois who made their living working in the oil industry by drilling and servicing oil wells. I know people are never aware that there are such things as oil wells in Illinois, but there are approximately 650 oil fields and around 30,000 oil wells in the state. It is a dirty business and not very many people want to do this kind of work, but we are all thankful for the people who have chosen to work in this industry.

When most people think of investing in oil wells they think of dry holes and unscrupulous individuals like Snidely Whiplash hiding in the weeds waiting to prey on another suspecting investor with cash hanging out of their pocket. Again, another myth. The reality of investing in oil wells is that with this kind of investment you can at least visit the well site and see where your money was invested and talk to the operator who you invested with and find out the situation if it is either good or bad. Not so when an individual invests in the stock market or mutual funds. And that is why I wrote the article about the “10 Myths of Investing in Oil”

When people invest money they are either buying stocks or mutual funds or REITS or some other type of investments I can’t even pronounce and how do they do it? Either online with a computer screen in front of them or at an Edward Jones or Financial Institution’s office. And even then you don’t know what you are investing in. You get to meet a nice person to whom you write the check to, but that is about it. And is it risky? Can you say “Bernie Madoff?”

My point to the story is not to make light of investing in stocks, bonds, mutual funds, or CD’s or other financial instruments. It is only to let people know that investing in oil is no more risky and sometimes less risky than the many different financial products that is touted by the many financial institutions.

Relax, enjoy the journey and hopefully I have shared some information that will benefit you in some way.

Myth #1 – You can lose all of your money.
Truth – It depends on how you want to look at your money. In reality the money that you invest into the oil business is different than the money you would invest into the stock market or the purchase of real estate. When someone invests into the stock market or the purchase of real estate they are investing with “post” tax dollars. Meaning they are using the money they have left over after paying the taxes that are owed on the money they earned to make the investment. But when someone invests into the drilling of an oil well they are given preferential treatment from the federal government in the form of Tangible and Intangible investment allowances. What this means is that if you invested $25,000.00 into the drilling of an oil well you would be allowed to write off or deduct the Intangible amount of your investment off of your annual gross income 60% to 75% of your investment could be written off against your personal income) of the year you made the investment. In essence you could never lose all of your money, because it never was all your money in the first place. The government was going to get their part of your income regardless whether you invested into an oil well or not. Generally they were going to get between 35% to 40% of your income anyway. So when you invest into an oil well you are really using some of your money and part of the government’s money.
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Myth #2 – It is more profitable to buy stock in Exxon or a major oil company from my stock broker than to invest in an oil well.
Truth – When you purchase stock from a stock broker or online in essence you are buying tiny piece of a huge corporation with millions of many different pieces. There is some comfort in knowing that it is a large corporation with holdings all over the world, but it also comes with a huge overhead to support. When one purchases stock in such a large corporation with their large overhead it takes a lot of movement in the market for one to make a substantial profit, plus you are buying the stock with “post” tax dollars so you only getting to invest 60% to 70% of the income you had earned. You have already given up a large part of your buying power before you even start. When you invest into an oil well it is called “Direct Participation” and that is what is happening. You are investing directly either into one oil well or a group of oil wells. Your investment is more focused on the production of oil and not on the running of a huge corporation. Your investment will have the chance to grow faster and larger when it is focused instead of thrown into a huge group where it is used to run the machine.
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Myth # 3 – Most oil wells are a dry hole. They only find oil in about 1 out 10 wells drilled.
Truth – There are different kinds of drilling when it comes to finding oil. The type that most people have heard of is “Wildcatting”. It is what was talked about on the TV shows of Dallas and other movies about oil wells where the guy goes out into the middle of nowhere and when he is down and out on his last dollar hits a gusher of a well and it blows up in the air and everyone lives happily ever after like the Beverly Hillbillies. In situations like that where one is drilling in the middle of no known oil production the odds of getting a dry hole are probably more like 25 to 1 that you will get a dry hole.

The other type of drilling that is done and has a much higher success rate is “Developmental Drilling”. When you are doing developmental drilling you are either drilling next to or very near to existing oil wells or oil fields. This type of drilling is highly successful and can sometimes have a 100% success rate. When investing into an oil well be sure to clarify if the investment is a wildcat or a developmental drilling project. Chances are if you are investing into a developmental drilling project you odds of hitting oil and making money are going to be very good.
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Myth # 4 – If someone offers you an opportunity to invest into an oil well it is a scam.
Truth – The best way to find out if you are getting a good investment opportunity is to do the research. Generally that is why people buy stocks and investments from a stock brokerage house or online service they have heard of, because they are not really interested in doing the research. An investment representative will ask them their tolerance for risk and take their money and invest it for them. Minimal risk. Minimal return.

When in investing into an oil well do the research. A for real oil drilling and exploration company will invite you to the drilling site and explain the risks to you first hand. They will allow you to hear what the geologist has to say in regard to whether the well is going to be commercial or not in his opinion. Legitimate oil operators don’t shy away from the investor who wants to learn more about the process of drilling and producing oil wells. They welcome the questions and comments and it allows you to get directly to the people who are making the oil well investment decisions and thereby increasing your knowledge of the oil industry and reducing your risk.
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Myth #5 – I know that the only reason I am asked to invest into an oil well is because they know it isn’t going to be a good well.
Truth – If anyone really knew how much oil an oil well would make before it was drilled do you really think they would be asking you to invest? Nobody knows. And I mean nobody knows how much an oil well is going to produce. When a project is based on developmental drilling it is easier to get an idea and a possible range, but even then nobody ever really knows how much an oil well will make. All oil wells are different. They can be right next to each other and be totally different. And that is why oil operators share the wealth and the risk when drilling. Because of the unknown. Even the largest companies in the world like Exxon, Shell or BP share the risk when they are drilling new projects, because they too know that there is an unknown factor when drilling oil wells and it is better to have a piece of a lot of oil wells than have all of your eggs in basket per se with just one oil well.
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Myth #6 – Investing into an oil well is easy, but it is after they start the well is when it gets expensive.
Truth – Very rarely are the carrying costs to maintain and operate an existing oil well excessive. The exception is rare. The cost to prepare, drill and complete and oil well are expensive, but if an oil well is completed properly the cost to maintain and operate are almost minimal. There are some wells that may go a year or beyond before ever needing any additional maintenance. Only when you have factors such as corrosive fluids or other chemical reactions down hole do you encounter excessive maintenance costs. It is rare that you will have excessive mechanical costs after an oil well has been completed. Your oil operator is also your partner when you are involved in direct participation oil drilling and they do not to be burdened with high carrying costs either. You can be assured they have already factored carrying costs into the equation, because they want the oil well to be a viable investment too.
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Myth #7 – Drilling oil wells sound dangerous and could have a lot of liability and I don’t want to become part of the liability factor.
Truth – Investing into oil wells is like when you buy stock. You are only liable for the amount of your investment. In the stock market if the company you invested in goes broke or has a product liability issue you are not affected by these issues other than your investment may go down or become worthless. The same is true when investing in an oil well where you have an operating agreement between yourself and the operator stating that you are not liable for any actions of the oil well and the operator is assuming the responsibility and liability. It is like getting the best of both worlds. You are on the ground so to speak in the front row watching your investment, but without any of the liability.
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Myth # 8 – Oil wells don’t have a very long life span.
Truth – Oil wells have a very long life span. Oil wells have a tendency to begin with a higher rate of production, because in the beginning you are letting off the pressure that has been captured underneath the earth’s surface for millions of years and over time it is like putting a very tiny tube into the side of huge tire full of air whereby it eventually slows down to a slow stream and continues to blow out air. Oil wells are similar. After the initial pressure has been released there is still oil in place and some wells will continue to produce 20, 30, 40 & 50 years under their own pressure. Some oil wells will need to get a push later in life with an operator injecting water or some form of gas to give the oil a push and help it come out. But generally an oil well has a long life. The production won’t be at a very high daily rate, but it will keep going and going and going like the Ever Ready Battery Bunny.
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Myth # 9 – If the price of oil goes down and the well is a low producer I won’t ever get my money back.
Truth – Everything in life is cyclical. Things go up and thing and things go down. And the price of oil is not different. However, in today’s world the market place is different. We now have 1 Billion people in India with a 300 Million middle class that is evolving and we have 1.1 Billion people in China that has 300 Million middle class that is evolving there too and are consuming more and more energy to help their countries grow and prosper. Plus like the stock market oil wells are known to be long performers and continue to produce and give an economical return to their investors. In the stock market if the sales of a company should tumble and go into the negative column as it did with General Motors and all of the investors money was wiped out with the company filing bankruptcy due to low sales. In the situation of an oil well if the market price should drop below the amount needed to be profitable you can turn the well off and wait until the market price returns. And it always cycles back around again to profitability in the oil business. You find after doing the math on the amount of money you have invested that over time before factoring in your tax benefits that oil investments generally have a very high rate of return.
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Myth # 10 – If I invest in an oil well I will be stuck with it forever and won’t be able to sell my interest.
Truth – An interest in an oil well is sellable, because it is based on cash flow. Just like a stock is priced based on earnings times a multiple an oil interest is the same way. The longer you own an oil interest and the more established the production becomes the easy it is to sell, because it has a proven cash flow record just like a stock in a company would have.
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Bonus Myth # 11 – They have found all of the oil there is to be found so why waste the time to drill?
Truth – It is believed that all of the big oil or easy oil has been found in the Continental United States excluding the offshore oil which is yet to be discovered. But big oil and new oil is expensive. Because it is in hard to get to places and it is much deeper than the oil found in the past it is much more expensive and therefore it would cost a private investor considerably more to invest in this type of oil exploration.

But there are thousands of proven oil fields in the United States with oil reserves in place that have been sitting idle for many years. Fields that were abandoned when the price of oil had dropped and before new technology was invented to get the oil out with reduced costs and at today’s prices make the developmental drilling procedures of an existing oil field very profitable and cost effective in today’s market place.