The Choice is yours: Assets or Liabilities?

Before starting my today's topic, I would like to tell you the real meaning of assets and liabilities and what mistake we students mostly do.

Last week I took a survey of my 5 friends. I asked all of them the same questions: The question was "What is an asset " and "What is a liability?"
All of them came up with the same answer which was "Assets means property and liabilities mean debts."
However, it is correct theoritically but not practically.
According to me, an asset is something that makes you money or anything which gives you cash flow.
Whereas a liability is something which costs you money and outcome of your cash flow.

To make it more clear, let me provide you all with a simple yet explanatory example.
There are two boys and both of them receive their respective pocket money. The first boy buys an iphone and starts showing off and he thinks that his phone is asset for him but as I told you earlier, assets means the things that makes you or gives you cash flow but by buying the phone he did expense.
On the other hand, the second boy decides to invest that money in stocks and purchase an iphone with the cash flow of that investment, which is the real asset of that boy.
If the rich do not work for money, then what do they work for?
Before stating the fact that the rich do not work for money, we should understand the true and actual meaning of working for money.
Simply, working for money is getting paid for time and work directly. It means if you are working, then you get paid as salary .
It is called Trading time for money .
Trading for money is just like working for money as active income.
Example - if we work for an hour we get paid for an hour.
And more than 95% people in India work like this.

And rich people do not work for active income they build assets and cash flow from assets is their income.
This is why rich people first focus on creating assets which can give them passive income.

5 types of asset of rich people are:

1. Small or big systematic business

2. Real estate (focused on rental income)

3. Paper asset (stock, bonds)

4. Commodity assets (gold, Silver)

5. Intellectual assets ( copyright, patent)

Many of us think that our property is our asset which is totally wrong , according to me our house is also a liability for us because it also increases your expenses and the
outcome of money .
But your house can be converted into an asset, if you give your house on rent by which you will get earning /cash flow and your house/ asset will make money for you.
If you want to be a real rich person, then you must apply this secret and create/build asset which will give you passive cash flow income.

Note:  The Choice is yours: Assets or Liabilities?

Motivation:

1. Focus on learning not earning.
2. The truth is that real rich are those only who have passive and portfolio income more than doublethan their lifestyle expenses.
3. Try to find the difference between the real asset and liability.
4. You become what you study - read alot...