Most people believe that their car is an asset or that even their house is an asset. Is it true, I guess if you want to believe what the bank tells you. But for anyone who has read Rich Dad, Poor Dad you know better. Or at least you know something different.
To Rich Dad and to most people who understand how money works, an asset is something that puts money in your pocket. A car certainly doesn’t put money in your pocket it looses money the second it leaves the show room floor. And your house, although it allows you to take more money out on credit, which you may be able to use to buy or create an asset that does put money in your pocket, is definitely not an asset. More often than not the bank owns more of your house than you do and you just keep paying them more.
No, an asset is something that puts money in your pocket. Everything else can be considered a liability. You need to start thinking this way or else you’ll find yourself diligently lining the pockets of those that use your house or car as their assets.
