Shark Tank’s Barbara Corcoran was an extremely successful real estate investor before appearing on the show. She’s grown her net worth to over $100 million in the years since. So when she offers investing advice, people tend to listen.
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Here are 10 of Corcoran’s top tips for getting wealthy.
Outwork Everyone Else
Corcoran says she struggled in school as a child, sharing, “I couldn’t do letters and numbers my whole life.” She says it was difficult watching classmates breeze through assignments she would struggle with for hours.
However, the experience taught Corcoran how to rebound from obstacles. She learned to work twice as hard as the next person from a young age and credits this as a key reason she’s become financially successful.
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The lesson is that sometimes getting rich is just about putting in more work than everyone else. That might mean doing more research into investment opportunities or working harder as an entrepreneur.
For example, finding the best real estate deals in your area will probably take more effort than a quick online search. Similarly, if you want to beat the stock market, you’ll need to develop enough skills to outperform the experts.
Invest In Real Estate
Corcoran made her first millions by selling her highly successful New York real estate business. She got to that point by demonstrating a consistent track record of success, which Corcoran attributes to her golden rule of real estate investing.
The rule is to buy multi-unit properties with at least 20% down. This, she says, lets you live for free while your tenants cover your mortgage. If you can do this in an up-and-coming area, you’ll live for free and eventually may be able to sell for huge gains.
Become Great at Failure
Corcoran also says it’s important to learn how to bounce back from failures quickly. She says the most successful entrepreneurs she’s worked with have this trait. Those who do typically focus on maintaining a positive, can-do mindset in the face of challenges.
For example, before the internet, Corcoran thought she could do better with her real estate investments by putting her properties on tape and sharing the videos. Although this failed, she bounced back quickly and took full advantage of online property listings before many of her peers. She would have missed out on that opportunity had she allowed her previous investing failure to keep her from trying again.
Take Advantage of Bad Times
Corcoran believes in Warren Buffet’s famous advice: “Be fearful when others are greedy and greedy when others are fearful.” She says it’s important to remain active during quiet times and that these can be your best opportunity to lay the foundation for future success.
For example, consider the housing collapse of 2008-09. Bad mortgages sent housing prices tumbling, but the market has bounced back and then some since. If you bought during the collapse, you’re likely very happy with your investment. Those who waited too long to reenter the market missed out on the best prices.
Don’t Worry Too Much About Diversification
Some financial experts recommend diversifying your portfolio to protect yourself from market downturns. Corcoran disagrees. She says she’s built a lot of wealth by investing carefully but not worrying about diversifying just for the sake of doing it.
It’s hard to argue with her results. Corcoran’s extreme focus on the real estate market helped her turn a small loan into a multi-million-dollar fortune. Warren Buffet follows a similar approach.
Set Huge Goals
Corcoran stresses the importance of setting big expectations for yourself. She says that if you can create an image of yourself that’s bigger and better than you are in reality, “you’ve got to run like hell to keep up…”
The idea is that when you have high expectations for yourself, you start seeing how hard you need to work to achieve your goals. Even if you don’t reach those goals, the effort you put into doing so will likely leave you in a great place financially.
This could mean setting a retirement goal for yourself that you question whether you could meet. Or maybe you want to increase your monthly income with stock market gains by an amount that feels beyond your biggest dreams. The higher you aim, the farther you’ll get even if you fail.
Consider Partnering With Family
Corcoran earned her wealth by investing in real estate. But she recognizes that many of the opportunities she enjoyed aren’t as affordable as they were in her day. That’s why she says partnering with family can be a smart move for young people looking to get a head start on building their net worth.
You might not be able to afford an investment property on your own. But maybe you can take on a few partners and split the ownership percentages accordingly. Doing so could help you get your foot in the door, which can help you get the money you need to eventually buy your own investment properties outright.
Take Big Risks
Corcoran says if you’re highly risk averse, it’s not even worth investing in real estate [6]. She believes that taking risks and being aggressive with your property purchases is a non-negotiable step to success in the industry.
You can use the same logic for other investments, too. The only way to get massive upside potential is to take risks that others are often unwilling to take themselves. That could mean buying a stock after it’s declined 50% when others won’t touch it or investing in property that others in your area warn you against.
However, you still need to be smart. Taking risks just for the sake of doing so is rarely a good move.
Don’t Be Afraid to Overpay
Corcoran says you shouldn’t be afraid to overpay for a deal you love [6]. Her experience is that the extra upfront costs tend to come back to you in profit over time. That could mean buying a stock that’s at its all-time high or purchasing a property above market price with great income-generating potential.
Hold Your Investments for Years
Finally, Corcoran has always been a huge believer in holding your investments long-term. She says this practice is what helped her realize massive gains in her real estate investments. If she had sold as soon as she was in a decent profit, she would not be as wealthy as she is today.
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