It seeks to help real estate agents stabilize their personal cash flow, generate an income they can support themselves and family on, and not be ramrodded when the tax bill comes at the end of the year. The profit first method is a promise to alleviate or avoid these problems. It’s easy for real estate agents to find themselves in a tax mess because they failed to set aside taxes that come with being a contractor and business. To make matters worse, we often face a dreaded tax bill at the end of the year. Living on commission and being responsible for expenses can be HARD. You’re expected to do all of this without getting paid until a home closes. It’s common for new real estate agents to invest time, money, and resources for up to six months before they make their first closing.Įven as an experienced agent, you still have to spend time and money to show clients homes, write up purchase agreements, and take listing photos. On top of that, a career in real estate often requires us to spend money, time and resources before we make any money. Sometimes it means we rely on our lines of credit or dip into our emergency savings. Managing cash flow from one month to the next is difficult. There is a lot of anxiety and concern about our livelihood. It’s hard to ride that emotional roller coaster. One minute we’re getting $10,000 worth of commission checks, and in the next minute, we haven’t closed a deal in months. That has a direct impact on our paychecks and cash flow as real estate agents. The real estate industry has its ups and downs - both in the long-term and short-term. What is it that the profit method solves? The Case For Profit First For Real Estate Agents It’s not enough for me to share with you what to do, but why you need to do it. Teamerages (the hybrid team and brokerage)īefore we dive into the principles of the profit first method for real estate agents, I want to make a case for it.Today, I want to share the case for profit first, how the profit first method works for real estate agents, and how it can work regardless of the real estate business model you run. I implemented the profit first method after the first year in real estate. The profit first method will work for you. It works for business owners and it will work for real estate agents. There are hundreds of case studies of business owners that found success with the profit first method and who have successfully changed the trajectory of their business. The profit first method was put through the fire and tested with business owners across various industries - from real estate, to construction, to dental practices. His book was developed from his personal experience as an entrepreneur and his conversations with fellow entrepreneurs. Profit First is a book and a method developed by Mike Michalowicz to help entrepreneurs overcome the challenges of cash flow and a lack of profitability in their small-business. Today, I’m sharing the power of profit first for real estate agents and brokers.įew money books will change the way you think about money, cash flow, and your real estate business.

Profit first allocation percentages