As 2020 winds down and you reflect on the goals and aspirations you had for this year, have you asked yourself why you have or haven’t accomplished all you planned to do?
Let’s take a moment and explore the latter: Why haven’t you accomplished your goals? Everyone can use the pandemic as a huge factor for their lack of accomplishments, but could it also be something else?
As I was doing some assessments of my business in 2020, I was quick to allow myself that copout. However, if I’m honest with myself, while the pandemic was a factor, the real hindrance to my success was indecision—indecision on what to do when we learned of coronavirus.
Should we pull back on marketing? Should we stop making offers? Should we even go outside? There was a ton of indecisiveness.
In the real estate world, indecision is called analysis paralysis. Analysis paralysis is not something only newbies face; seasoned investors go through it, as well. Even though I’ve been buying rentals, fixing and flipping, and wholesaling for years, analysis paralysis rears its ugly head every now and then.
Reflecting on 2020, I began to realize indecision—aka analysis paralysis—is a detriment to success in four ways.
How Indecision Impedes Your Success
1. Slows Progress
When embarking on any endeavor, momentum is crucial. I can speak from experience.
One of the biggest fears outside of talking with sellers is making an initial offer. You begin to question yourself. Is my offer too high? Is my offer too low? Did I miss something on comps? Are my rehab numbers correct?
If you become too analytical, it slows your progress. We have been taught from an early age that mistakes are harmful—you don’t want to make mistakes. I beg to differ. When speaking with other investors or listening to highly successful individuals, they always say they learned more from the bad times than from the good.
When you’re afraid to make a mistake, you overanalyze. And while you’re racking your brain over this one decision, you’re slowing your progress.
In our example above, just make the offer with confidence and figure everything else out along the way. You have to maintain your momentum.
2. Creates Doubt
This is critical. Doubt is a killer of confidence and there is nothing you need more as an investor than confidence.
The easiest way to fail is to have low self-confidence. Analysis paralysis creates a level of doubt that can become infectious. This doubt can spread throughout your team. It can have you second-guessing every decision you make, which in turn slows your progress, which we talk about above.
It’s okay to be uncertain about your decision, but you have to make a decision. No matter how concerned you are about the decision, it’s better to just decide and stop sitting on the fence.
This was a major flaw in my character. Now, I’ve decided to make a definitive decision within five minutes of receiving the information. And I’m starting to learn that even five minutes may be too long because of my analytical thought process.
3. Sets a Foundation of Fear
Analysis paralysis is basically fear. You’re scared.
Be truthful; this is the reason people continue to analyze the same data sets for hours. Nothing has changed with the numbers, nothing has changed with the property location, and nothing has changed with your exit strategy. What is changing is the thoughts in your mind—the what-if scenarios.
Think about it. Normally when we question ourselves and say, “what if,” it’s never, “What if the optimal outcome occurs?” It’s always, “What if this goes wrong, how will I be able to fix it?”
Don’t let analysis paralysis become your foundation of fear. This will undoubtedly stop you from reaching your dreams.
4. Opportunity Cost
So what happens when you sit on the sideline for months trying to figure things out? Those months tend to pile up and they become years, and when you get old enough they become decades.
All of this lost time is also lost opportunity. Analysis paralysis will tend to slow down everything you’re trying to accomplish, thus making you miss out on opportunities.
For example, I was working with a seller and we weren’t able to agree on a purchase price. There was only a $10,000 difference in price. The seller was in no rush to sell and I let the $10,000 barrier stop me from pulling the trigger.
What I should have done was put the property under contract and figured it out from there. Because of doubt, fear, and slowed progress I missed out on the deal. I later found out that the seller had multiple properties he was willing to sell, and because I was indecisive, I missed out on four other properties.
If you’re going through analysis paralysis on a deal or on the sidelines about becoming an investor, the only thing you have to do is decide.
The sooner you decide, the less likely you are to miss other opportunities.
Do you have any favorite strategies to use when making a decision?
Tell us how you commit to your choices in the comments.