Buy Assets

Although I cannot fully endorse Robert Kiyosaki’s book Rich Dad, Poor Dad (it is a fairly controversial book in the PF world, because he goes against just about all traditional fiancial advice), I do think it is a worthwhile read. Especially since you can get it from Amazon for under $5.

Just Buy Assets

One of the worthwhile points he makes is to, “Buy Assets and Sell Liabilities”. It is common sense, but often times common sense isn’t that common.

He defines an asset as “something that puts money into your pocket” and a liability as “something that takes money out of your pocket.

I think this is a great way to think about every purchase. How much will this item be worth in 5 years from now? Most of what most people buy will be worth a small fraction of what they paid. If you focus on buying more assets (stocks, mutual funds, real estate, or anything else that will increase in value) your wealth will begin to grow at an impressive rate. As Kiyosaki would say, this is what separates the rich from everyone else.

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