How to divide your income and begin a new career investing in property

The idea of beginning a new career in property investment can seem daunting, especially for young adults with modest incomes. However, with careful planning, strategic allocation of resources, and a willingness to learn, building a property portfolio can become an achievable goal.

Steven Clark, Scottish property investment expert and Founder of This Is Property, shares his guide to begin building a property portfolio. In the below, Steven will outline practical steps tailored to young Scots aged 18-28, with a focus on low to medium income earners on around £25,000, to begin their property journey and find success.

According to the Global Entrepreneurship Monitor Scotland Report (2022/23)[1], there has been a clear change in young people's attitude towards entrepreneurial careers. When surveyed, nearly 300,000 working-age Scots between 18-64 were engaged in early-stage entrepreneurial ventures, and amidst this demographic, 59% (176,000) of Scots were nascent entrepreneurs, investing time and resources into new ventures.

Steven Clark hosts his introduction to property investment course, the 'Awakening'

Collectively, these statistics highlight the entrepreneurial enthusiasm in young Scots, with over 490,000 individuals undertaking independent entrepreneurial endeavours in various stages of business development, underscoring the dynamic nature of the entrepreneurial ecosystem.

Reflecting upon this data, it is abundantly clear that there is a real desire and enthusiasm amongst young people to be in control of their career, finances, and lifestyle. The good news is that there has never been a more promising time to get involved with the Scottish property market.

Before diving into the world of property investment, it is crucial to lay a solid financial foundation. For young adults, managing a limited income amid the cost-of-living crisis effectively is key. The rule of thumb I live faithfully by is the 50/30/20 budgeting rule. Let’s use the UK average income for 18-24-year-olds of £25,000 (£1,709.22 per month, after tax) as an example.

It goes without saying, but ensuring your financial obligations are met is top priority. Your ‘needs’ budget will include essential expenses, such as rent, utilities, weekly essentials including food shop, etc. Maintaining a stable lifestyle will ensure a level of comfort and stability that will sustain your property journey. Cost translation: £854.61

Allocate 20% of your income towards building your investment portfolio. This fund will be used to build property down payments, renovations, and other real estate ventures. Consistently investing a portion of your income lays the groundwork for long-term wealth accumulation. Cost translation: £341.84

Building and maintaining a safety net should always be a priority. Aim to set aside at least 10% of your income for unexpected expenses or future investment opportunities. Cost translation: £170.92

Continuous learning is vital for success in any field, including property investment. Dedicate 10% of your income to self-improvement and education. This can include attending seminars, purchasing books, enrolling in courses, or seeking mentorship from experienced investors. Investing in knowledge enhances your understanding of the market and equips you with valuable skills for making informed decisions. Cost translation: £170.92

Finally, don’t forget to have fun. While it is essential to be disciplined with finances, it is equally important to allocate a portion of your income for leisure. Prevent burnout and give yourself space for nights out, pursuing hobbies and booking holidays. Cost translation: £170.92

Taking the first brave step into a new financial venture can be daunting, but by being your own financial backer, your confidence will grow. Beginning your property journey as a young, low to medium-income earner requires careful planning, discipline and a keen willingness to learn. By following a structured approach to financial management, allocating resources wisely, and committing to learn as much as possible about your desired industry, will always put yourself in good stead.

With dedication and perseverance, you can turn your property aspirations into reality and embark upon a rewarding investment journey. The property market is a marathon, not a sprint, so remember to stay patient and stay focused.

This Is Property is set to launch ‘The Awakening’ on 20 - 21 April 2024 at The Village Hotel, Edinburgh. Priced affordably at £97, The Awakening is a comprehensive two-day workshop offering a broad overview of property investment, providing first-time guests with the knowledge, skillset, and strategies essential to creating a profitable property portfolio.

For more information about how to kick-start your career in property, visit This Is Property’s website today https://thisisproperty.info/courses/.

[1] https://www.enterpriseresearch.ac.uk/wp-content/uploads/2023/07/105639-GEM-Report-SCOTLAND__FINAL.pdf