There is a very important part of becoming a successful REALTOR that has only a little bit to do with selling houses: managing your income. Unlike a salaried employees, REALTORs do not have guaranteed income. Plus, there are no automatic tax withholdings or retirement plans for REALTORs. While this shouldn’t scare anyone from entering the industry, these REALTOR tips on managing income can help new agents be more successful.
- Have savings – Having money set aside is crucial for new REALTORs. Even experienced REALTORs understand the importance of having money set aside to help through lean months. After all, there are no paid vacation, sick, or personal days on this job!
- Reduce or eliminate debt – Having as little debt as possible also helps with those leaner times. As a REALTOR there will be marketing and education expenses and reducing debt frees up more income to put back in the business. There are multiple strategies for getting debt free, though we personally are fans of Dave Ramsey.
- Use a budget – Having a budget is essential for managing your income as a new agent. Tracking expenses will reveal where and how you spend money, as well as where you can cut costs.
- Set aside for taxes and retirement – Again, there are no automatic taxes taken out of real estate commission checks. There’s no automatic contribution to a retirement plan either. Start to set aside early and consistently for these two costs, even if it means living on a reduced income.
While lots of people imagine REALTORs make tons of money every month with little work, nothing could be further from the truth. REALTORs work very hard to earn an income and it can take awhile before becoming successful enough to have a more predictable one. Learning to manage your income early on is not always easy either. However, it is a crucial part of becoming a successful REALTOR.
Want a mentor to talk with you about managing your income as a REALTOR? Call DeSelms Real Estate today at 615.550.5565 to learn more about how we help new agents!
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