Goals: Are You Investing or Are You Working?


One of the most important things to do as a real estate investor is to choose the strategy that’s the best fit for you personally. When you do this, you switch your journey from being a constant uphill climb to one that you will likely see higher profits on with less strain.

There are several aspects that should be considered when you’re trying to decide on what investing strategy will be the best fit for you. One of the primary factors to be considered is your goals. You don’t want to choose a strategy that doesn’t hit your goals because what’s the point then?

When you’re looking at your goals, you want to not only understand the specific goal, but also what constitutes those goals. For example, if you set a passive income goal for the sole purpose of wanting to be able to travel whenever you want, you want to make sure you aren’t choosing a strategy that somehow prevents you from traveling, even if you’re hitting your income goal. Remember that in that scenario, the goal is the travel. The specific income amount is the vehicle that allows you that goal.

Now, with that example in mind, let’s talk about what’s most important to understand: the difference between working and investing.

You obviously know the difference between working at your full-time job and real estate investing, but what about the difference between working and investing in real estate investing.

Let’s start with defining the difference in these two beasts.


Going to the trusty Google and looking up the definitions of working and investing, I get these definitions:

Invest: 1. Expend money with the expectation of achieving a profit or material result by putting it into financial schemes, shares, or property, or by using it to develop a commercial venture.

Work: 1. Activity involving mental or physical effort done in order to achieve a purpose or result

2. Mental or physical activity as a means of earning income; employment

3. A task or tasks to be undertaken; something a person or thing has to do

Very simply: you have to do something to achieve profits if you’re working, and you only have to put money somewhere to achieve profits if you’re investing.

Working versus investing… in real estate investing

You may assume if you’re investing in real estate, you’re simply investing. In some cases, that’s true. But in other cases, you’re having to work—meaning you’re doing things to make money—rather than simply putting your money into something.

Here’s some example of various real estate investing strategies, and various methods of those strategies, that fit into the working and investing categories.

All work, no investing


Lots of work, some investing

Flipping houses when you’re the one doing the rehab work

Landlording a high-risk rental property that requires a lot of attention

Some work, lots of investing

Flipping houses using a contracting crew and you’re only in charge of oversight

Landlording an average rental property with only occasional oversight

Minimal work, lots of investing

Having a property manager manage your rental property

Least amount of work, lots of investing

Investing in syndications

Investing in notes

No work, no investing

Never actually getting started

One thing to note with this list is just because a strategy is labeled as requiring little work doesn’t mean that there’s never work required for it. For example, before you invest in syndications or notes, you at least want to spend the time learning about those things before you jump in. So that part is still work. But the actual strategy itself requires little to no work.

Why it Matters

Does it really matter which category of working vs. investing a particular strategy falls into? Yes! Because that will tell you if that strategy can help you meet your goals or not, and it can also tell you what level of effort you should anticipate putting towards it.

In the example I mentioned about wanting to get passive income so you can travel whenever you want, the idea there is that if you have to physically be at a property working in order to make the investment work, that doesn’t very well support the idea of traveling whenever you want, does it? In that particular example, you need an investing strategy that is solely, or at least mostly, investing with little to no work required on your part.

I’d imagine if you’re reading this article, you’ve already read Rich Dad Poor Dad by Robert Kiyosaki. If you haven’t, shut this page down immediately and go read that book. Or, go order the book and while you wait on it to arrive, keep reading. In that book, Robert Kiyosaki talks about the Cash Flow Quadrant, which explains the importance of working in your business versus working on your business. Your “business” in this case is real estate investing.

After you’ve read Rich Dad Poor Dad, be sure to read my book NOT Your How-To Guide to Real Estate Investing: Life Lessons on Hacking Your Mind Before You Hack Your Wallet. While Robert gives the high-level explanation of working versus investing, I dive into the real estate specifics. I go over those example of which strategies follow which ratio of working vs. investing, but I go further with it and talk about how to incorporate that into your personal investing goals.

Remember when you’re investing to make sure you’re clear on exactly what’s required for you to profit, and be sure whatever that is fits into your goals! If you wind up doing a strategy that goes totally against your goals, maybe even without you realizing it, you aren’t going to be happy and you won’t be any closer to hitting your long-term goals. Watch out for “sweat equity” if passive income is your goal!

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