Center for REALTOR® Development 040: Financial Considerations for You and Your Clients with Ryan Bokros
Even though financial experts don't agree on where we're headed economically, there are still principles that can help you improve your financial situation in any market. Today's guest, Ryan Bokros, joins Monica to talk about some of these practical principles that you can start applying today. They cover expenses, savings, lending, the current market climate, and what you can do now to make sure you come out of this time successful.
One of the most important basic financial rules is to treat your business finances like you would your personal finances. Keep a separate checking account and a savings account, and a credit card specific to a purpose. For agents, as you start to get in touch with your expenses, go through all of your monthly fees and really identify where your money is going, and how often you are utilizing the products of those charges. If it's not an essential part of your business, start looking here first for places to gain control. You can prioritize products or software by things that provide a benefit — making you money, or helping you stay more connected.
Ryan and Monica discuss some of the kinds of marketing and different apps people might be using where you could save money, especially during this slower time. If you can't correlate a cost per lead to close, this would be a good place to cut costs. You also need to watch out for annual subscriptions; you can look through your credit card bills to help track these things.
Savings is an interesting discussion; a big part of savings comes back to lifestyle and how that correlates to the income that you have. Prospecting income in real estate is different because you don't necessarily have a paycheck every two weeks. Ryan talks about a quarterly savings structure, and using more of a chunking method instead of giving a percentage of a check, for example. It is wise to keep at least a few months of cash in an emergency fund that you can access when/if needed. This will be especially important as things start to turn in the coming months. As you cut your expenses, don't forget to save!
Today's lending environment is very fluid, even from day to day. When giving your clients information, keep it broad. Give them enough information that they will come to you when they are ready or have questions. If you don't have one person that you would trust to do your own mortgage, then you're behind on being able to provide the best advice to your clients. A trusted relationship with your own lender is crucial to be able to share the best information to your clients. Ryan and Monica talk about how the big banks can help predict trends that may trickle down to smaller, local bank lenders. Keep your finger on the pulse for yourself, and also build those trusted relationships so you can supply information to your clients.
Ryan and Monica briefly touch on our current situation with the forbearance issue and deferrals. All of the banks are going to handle these differently when it comes time for people to pay these back. They talk about the likelihood of an inventory struggle coming out of this, and what consequences may follow. As agents, we don't have to understand all of this, but we do have to understand that there is change happening that we may not fully understand yet, but that will affect us and our clients. We may need to step back and focus on advising, rather than buying or selling. This will be the difference between agents who come out successful from this time and those who don't.
When it comes to the financial part of your business, be a learner. Be discretionary with your spending, and also intentional about your learning and where you're getting your information. Keeping people informed can help keep anxiety low, and help clients make good decisions. As an agent or a client, make sure you are always looking at real numbers. Spend some time looking at your finances, and make sure you are set up for success.
Tweetables:
"For many of us that are in real estate, the chasm between our business expenses and our personal expenses is really close." — Ryan
"Having that emergency fund is huge for a self-employed person because quite frankly, it helps you sleep better.' — Monica
"The people who came out of that with successful businesses were the people who took a step back during that time and said 'What can I do to effectively make sure that I'm the best person for the consumer right now.'" — Ryan
Guest Links:
Additional Links:
Online learning.REALTOR for NAR Online Education
Training4RE.com — List of Classroom Courses from NAR and its affiliates
Host Information:
Monica Neubauer
Speaker/Podcaster/REALTOR®
Monica's Facebook Page
Additional Bio:
Ryan Bokros has been serving Houstonians in many aspects of the real estate industry for over 14 years. He is a practicing REALTOR® and the Director of Market Development for JP and Associates, REALTORS®. He has been recognized by the Houston Association of REALTORS® as a Top 20 Under 40 Rising Star in Real Estate. Ryan attributes much of his success to being an early adopter of technology while maintaining face-to-face relationships. He holds a belief that technology should enhance the consumer experience, not take away from it. Ryan has developed and executed in-brokerage training programs geared toward engaging the next generation of real estate professionals to understand service through technology. Using his experience as a practicing agent, Ryan has been able to give back to the industry by helping other agents be better at serving their clients. As a respected speaker and educator, Ryan has traveled North America teaching agents how to be more productive with technology tools and streamline their processes to become more efficient. Ryan also proudly serves on many levels of the National Association of REALTORS® and the Texas Association of REALTORS®. In 2019 he served as Chair of the NAR Residential Economic Issues and Trends Forum as well as a member of the Research Committee. He also led the Texas Association of REALTORS® MLS & Technology Committee as Chair for 2019.