THE TRUTH ABOUT ASSETS AND LIABILITI

Layman’s definition of Assets and Liabilities: Assets refers to whatsoever “owned” property/ies that puts money in your pocket whether you work or not while Liabilities refers to those “owned” property/ies  that drains(removes money) your pocket whether you work or not.

From the forgoing definition, you will notice that the word owned was given some attention. This is because you definitely have to own a piece of property and have all the documents and rights/or even some rights and shares in cases of joint ownership to its ownership before your banker can list that to your statements of accounts.-(Please prove me wrong by bringing your proof and leaving a comment below).

To get rich, all you need is some money at a moment. Your ability and willingness to spend that money will cause people to call you “Rich”. Thus, “rich” is measured by the size of your pocket at any given point in time.

Wealth is totally different. In fact, to bring out the distinction, I can say that wealth is measured by the length of time you can survive without working. You can be rich today and broke tomorrow. A guy that just won a lottery today and cashed out $1,000,000 can be broke the following week. Rich can be said to come from hard work or luck (if something like ‘luck’ actually exist). But a wealthy man makes money even while asleep. And he can decide not to work anymore and still have all the good of this world. If you can survive a week without working, then you are a week wealthy. If you can survive the rest of your life from now without working, then you are very wealthy.  

Do you want to be rich or wealthy? (Please leave your answer below).

This is where the knowledge of assets and liabilities plays an important role.

Let’s use an illustration to push forward this idea. Assuming you have a car for private use only then that car is only a liability because it removes money for maintenance from your pocket but by using that car for commercial purposes, it status changes from being a liability to being an asset. But you must make sure that you don’t end up becoming a taxi driver cause that will become a job meaning that you have to be there for the car to make money for you. As someone that wants to be wealthy, you can’t take that part because it won’t lead you to wealth.  From the foregoing, we can see that a piece of property can be either an asset or a liability just by the slight change of usage.

There are other types of asset too. They include Real Estate, Business, Books, Bonds, Shares, Stocks e.t.c.

Thus the key to acquiring much wealth is in your ability to acquiring and utilizing properly your assets.

We want to have an interactive section now. So in the comment below, tell us if this material has been of help and give us some examples of liabilities and the misconception you had about this topic previously.

Am excited about the future! Am Mr Edovasal (Ezeji Daniel Onyekachi).

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