Acquiring Asset To Build Wealth
Acquiring asset to build our wealth is what we need to do, what an smart investor do. From the previous post, we know that we cannot keep currency for long time. Once currency is not moving, it is dead. No value. Currency does not represent our wealth. So what we need to do is transferring our currency to asset. Currency got no value but asset got.
Asset is something you own that can help generate income either now or in the future. This is base on my own definition. Some people might think that car, mobile phone, and house ( not for investment purpose) are assets. But for me, those are liabilities. As long as it cannot help me generate income, I will act them as liabilities. That is my simple and easy understand definition for asset.
Robert T. Kiyosaki author of Rich Dad Poor Dad like property as his asset. He buy property and rent it out using leverage of the bank money. He start gaining income after he settle the housing debt. On the other hand, he is also consider as gaining income as the rental from tenant is used to pay the bank debt. No money is flowing out form his pocket. This is what Robert called good debt.
My sister-in-law is owing tractor as his asset. Some might ague that why owning tractor is asset while owning car is liabilities. The different here is he is renting his tractor to others to gain side income. The tractor work for him.
Another new type of owning asset is owning space online. Some people monetize their website to make money online. I guess it is unnecessary for me to name it out the name who making fortune online. Plenty of it.
My favorite assets are property too. Hope to own as many property as possible. Any other asset that are worth acquire?
