Did Your Banker Tell You The Whole Truth?

Accounting 101 aside, what exactly is an asset anyway? Many people believe that assets consist of possessions like cars, boats, houses, and furniture. That isn't true. Sadly, most of us have been taught that we need to buy things like these to gain net worth. Realistically though, have you ever been able to go to the store and pay for groceries based on your net worth?

Basically, an asset is something you own that actually generates any kind of positive cash flow for you. In other words, it generates more money for you than what you have invested in it. And, it generates this money month after month.

Now, let's look at the other end of the financial spectrum - Liabilities. A liability is the opposite of an asset. It is defined as something that takes money out of your pocket each month. That is, it costs you something each month. Now that we have both assets and liabilities defined, let's take a closer look at them.

Many people look at their homes as an asset. In fact, bankers even tell us that houses are an asset. Sadly, this can't be true based on the definition of an asset given above. Why? Because if you are paying a monthly payment on your house of any kind, and taxes, and up keep, and utilities, etc each month, does the cost of these get exceeded by the income your house creates for you? No. In reality, your house takes money out of your pocket and doesn't pay you a penny. Thus, your house is a liability. Keep this in mind though. Every liability is an asset for someone else. In the case of your house who is that someone else? The bank. That's right, your house is an asset for the bank that has the mortgage on it. It is not your asset, rather it is the bank's. So the next time you hear a banker say your house is an asset, remember they are telling you the truth. Deceptively, however, they are not telling whose asset it really is.

Honestly, the only way you will ever be able to create wealth is to either purchase or create assets. The more assets you have, the more cash flow you will enjoy. Where does that leave you? Are you like most people who misunderstand exactly what assets and liabilities are? Would you like to start creating your own assets TODAY?

The good news is that we specialize in showing people just like you how to create assets that will actually pay you. If you are ready to get started in creating your own assets, then send us your name, phone number, and the best time to call. We will show you how to begin your building project TODAY! CLICK HERE to send the email.

To Your Success,

Stephan Bourget
Success Team Builders

Discover The Difference Between The Assets & Liabilities