Assets vs. LiabilitiesAssets - something that puts money into your pocket
Liabilities - something that takes money out of your pocket
Is the home in which you live an asset or a liability?
In Rich Dad's world, your house is a liability. Even if you own the property with no mortgage, you still pay property taxes, utilities, maintenance, etc. Therefore: money is being taken out of your pocket. It is not until you sell that property – at a profit and realize capital gains – that it becomes an asset.
Types of Asset Classes
There are three types of assets:
PAPER ASSETS
This includes stocks, bonds, mutual funds, insurance
They create PORTFOLIO INCOME
REAL ESTATE
This includes residential properties you don't live in and commercial properties
They create PASSIVE INCOME
BUSINESSES
They create PASSIVE INCOME
By Robert T. Kiyosaki
http://www.richdad.com/
