It’s just about a year ago. You were thinking of what to buy for Christmas. What about a family present? You figure it out. You’ll get a computer ($2,500). The perfect gift for the whole brood. Educational programs for the kids – included. An all in one word-processing, spreadsheet, and database program plus money management for the parents – included. You can even rationalize the price – you will use it to make money, by managing a home business. It was a great present and everyone is happy… for awhile.
Then you find out the kids think the educational programs are lame. They want the full version programs of the gory shoot’em-ups they’ve downloaded from the Internet. These set you back $50 a pop ($100/month). You have successfully sent email to your brother (Internet service provider, $20/month) and written a letter to Mom. You ask a friend how to use the spreadsheet or database software and they tell you to buy a book ($30) or take a class ($250).
Forget making money with this thing. It is a money pit! How can you make it pay for itself? Spend more on software and training.
The guy who sold you the computer should be jailed if he did not share the number one tenant of computer ownership – The software, data and education you will buy to get the maximum out of your computer will cost double what you pay for the computer. When you’ve paid all of that it is time for a new computer and the process starts over.
Is this a bad thing? Only if you don’t get your money’s worth. I bought my first computer in 1985. It had two floppy disk drives and no hard drive. It was “portable.” We bought Lotus 123 and dBase. I learned how to program dBase and Lotus 123 at a seminar. My wife ran around with it on a luggage carrier to clients. She asked strange men to lift it up on the Conference Room table for her. She showed banks the real costs of their non-performing assets. She did it using a spreadsheet and database program we designed. She made a lot of money.
The portable was replaced in 1987 with a “laptop.” The laptop was replaced in 1989 with a “Notebook.” We’ve been buying lighter, faster notebooks and desktops ever since. We’ve bought a lot of great software. We’ve taken a lot of classes. We’ve definitely made what we spent back in spades. As a side light, we get a lot of entertainment out of our computers, just come by the office some Tuesday night for one of our network Quake games.
I bring all this up to help you with a few decisions you need to make. Quite a few people I talk (or email) with are frustrated with what kind of computer to buy, how much to spend, and how to get their money’s worth. So in this buying season for gifts let me give you my ideas.
The software, data and education you will buy to get the maximum out of your computer will cost double what you pay for the computer.
The ability to do higher quality, more complicated work faster is how you make money with your computer. Computers are merely machines. They have no value without software. Software is what allows the machine to do the complicated quality work fast. Don’t skimp on good software. The software that comes with most computers is not good software.
Good software costs real money. It’s worth every penny.
Good software is feature rich. To get maximum value from your investment learn to use the features. Buy a book and read it next to your computer trying the exercises as you go. Or go to a seminar and learn in their lab.
Most important, always do the task using the software features. It will take you longer to complete the task the first time, but you will do it faster every time thereafter.
When buying a computer, budget your money taking the cost of the software and training you need into account. Many people have called me and asked what is the best way to spend their $3,000 computer budget. If you want to work real estate, here is my answer:
- Computer – $1,600 to buy a Pentium 166 with 32mb RAM, 2.1GB Hard Drive and a 12x CD-ROM drive plus a 15″ monitor.
Software – A good time management program and a good communications package.
If you are going to use Daily Default data get ACT v2.0 for Windows and Procomm Plus for DOS only because what you lose in power you gain in the work they’ve already done for you. I would also suggest getting Winfax for faxing.
If you are going to use another company’s data, I advise getting ACT v3.0 for Windows 95 and using Winfax for your communication package.
Everyone should also purchase a word processing program – I suggest Word – and a spreadsheet – I suggest Excel. The Microsoft Office Suite is quite good overall.
Plan to pay at least $600.
Data – A source of Default, Trustee Sale and REO leads, & A good comparative sale business.
In Northern California we suggest Daily Default Infoservice for the county recordings, in Southern California we recommend County Records Research. Price about $89/month.
For a comparative sales service we do like Dataquick, Property Pro CD, but MetroScan and CMDC all have their advantages. Price $100 to start and about $100/county/month to continue.
Internet Connection – For Internet go with a large presence. I like Coastal Web Online and they are now statewide, $200 for 6 months.
Education – At a minimum buy a third party book. This works well for me because I read them. Most don’t. If you fall into the latter crowd, get one of the video training programs. My employees have done quite well with them.
Plan to pay at least $100.
Add this all up and you get $2,700 up front and $190/month thereafter.
Follow this plan. Buy a reasonable computer. Stock it with good software. Learn to use the software. Fill the software with good data. Apply a good system to locate, value and follow up with sellers.
The computer will make good money for you. Use it to entertain your kids and maybe it will pay for itself in the quarters saved at the arcade.
