The down side to making money.

It does happen and when it does being prepaired gives you the courage not to panic. First if you are out there doing something sooner or later you will get lucky and make some money, it's inevitable. On the other hand, sooner or later, no mater how well you planned everything, circumstances will happen that makes the deal slower, faster, harder, more expensive and so on.

One way to be prepared is to consider the worst case scenario and ask what if this or that happens, what will I do? I will say that with experience this gets easier just as experience eases the scary parts of investing. Budget for the extra carrying cost and know where you will get the money. Plan for the extra expenses and know where you will get the money. Plan for the unexpected and have alternative possible outcomes. Don't bet the ranch on any one deal. You get the idea. If you do worst case scenarios be sure to do best case scenarios too. I wouldn't want you to get depressed.

I have faced these cash flow shortages dozens of times over the last 40 years and I most often come out further ahead because I carried the investments through the rough spots. I remember one deal where I sold a property to a bank, with commercial real estate deals it can take six months to close. Two weeks before the closing date, the bank gets sold and the deal dies. I carried the property the extra six months and it might be another year before it sold again so I called the real estate agent and raised the price twice my extra cost. It took two years but I got the higher price. The agent wanted me to lower the price for a quick sale (he thinks commission check) and I wanted to maximize profit. My reasoning was that if the bank was willing to pay that much some one else would to, and they did. For two years I was short of cash carrying this property at $2,300 a month plus taxes. In the mean time I could not do any other deals because my cash was tied up. I got $100,000 extra for my trouble so in the end it was worth the trouble.

If a deal was good to start with? Hold your ground, with good planning you can do that no matter how scary it is. If the deal was flawed from the beginning, get out, take your losses and move on to another deal. Just remember if you fall in love with any investment it is no longer an investment but rather a hobby. Hobbies are the bottom-less pit you throw money into.

If you want to get rich? You are always looking, always planning, always thinking and always doing.

And that, dear reader is how all them folks who make money get so dam lucky. With intelligent effort comes reward.