MIND YOUR OWN BUSINESS

MiND YOUR OWN BUSiNESS

The rich focus on their asset columns while everyone else focuses on their income statements.

Minding your own business. These ideas all still focus on the income column and will only help a person become more financially secure if the additional money is used to purchase income-generating assets.

The primary reason the majority of the poor and middle class are fiscally conservative—which means, “I can’t afford to take risks”—is that they have no financial foundation. They have to cling to their jobs and paly it safe.

Financial struggle is often the result of people working all their lives for someone else.

        Start minding your own business. Keep your daytime job, but start buying real assets, not liabilities or personal effects that have no real value once you get them home.

 A new car loses nearly 25 percent of the price you pay for it the moment you drive it off the lot. It is not s true asset even if your banker lets you list it as one.

        Keep expenseslow, reduce liabilities, and diligently build a base of solid assets. For young people who have not yet left home, it is important for parent to teach them the difference between as asset and a liability.

Get them to start building a solid asset column before they leave home, get married, buy a house, have kids, and get stuck in a risky financial position, clinging to a job, and buying everything on credit. Many young couples who get married and trap themselves into a lifestyle that will not let them get out of debt for most of their working years.

What kind of assets rich dad is suggesting that you or your children acquire? In my world, real assets fall into the following categories: 

  Ø Business that do not require my presence I own them, but they are managed or run by other people. If l have to work there, it’s not a business. It becomes my job.

  Ø Stocks

  Ø Bonds

  Ø Income-generating real estate

  Ø Notes (IOUs)- I own you

  Ø Royalties from intellectual property such as music, scripts, and patents

  Ø Anything else that has value, produces income or appreciates, and has a ready market.

Start minding your own business. Keep your daytime job, but start buying real assets, not liabilities.

When I say mind your own business, I mean to build and keep your asset column strong. Once a dollar goes into it, never let it came out. Think of it this way: Once a dollar goes into your asset column, it become your employee. The best thing about money is that it works 24 hours a day and can work for generations. Keep your day job, be a great hardworking employee, but keep building that asset column.

This article is taken from Rich Dad andPoor Dad.

Written by Arshad. A

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