FINANCE
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Lesson 4 - Create , build and find your asset
In this Advanced Guide to Getting Out of First you need to find extra work to increase your ability to pay off your bad debt . With the advanced method , you ’ re building your asset column to increase your ability to pay off your bad debt . You get a two-for-one deal — more assets and less bad debt . I always hammer people to stop buying ‘ luxury indulgences ’ and liabilities and start buying assets . finance and investment education specialist and author of over 20 finance help books , Robert Kiyosaki , we delve into critical strategies for overcoming debt .
What is an asset or a liability ? To put it simply , assets put money in your pocket and liabilities take money out .
Example One - Your home
• Liability - Your home doesn ’ t generate income , it costs you money through costs of the mortgage bond , levies , property rates and taxes , maintenance , utilities and other expenses so it ’ s a liability .
• Asset - What happens if you rent it out ? Only if the rental income is more than the total expenses , then it is an asset .
Example Two - Your car
• Liability - Your car is a liability , even if it ’ s paid off as it costs you monthly instalments , diesel / fuel , insurance and maintenance to run it .
• Asset - If you start renting it out as a service such as Uber ® or some other taxi service , then it ’ s making you money than your expenses then it becomes an asset .
Once you get some courses and training done , continue to save until your ‘ Pay Yourself First ’ savings can be used to put your education into action . When I bought my course on real estate , I immediately went out and found deals .
They were not the deals I invest in today ; they were very small , and they were what I could handle at the time . My mindset was not large enough to believe I could invest in huge multiunit apartments successfully . I had to start small and learn the lessons from experience , as well as grow my own confidence .
EXAMPLE THREE - REAL ESTATE EDUCATION SEMINAR
• Liability - The R3000 Real Estate Seminar took money out of my pocket . When you use the money from your ‘ Pay Yourself First ’ savings , you need to first buy the education that is going to teach you how to buy or create an asset .
• Asset - When I put what it taught me into action , it put money into my pocket . Education is an asset , but only if you use the education to make money . Check your local area or search online for courses on investments or businesses you ’ re interested in and passionate about .