Knowing all types of assets is very important to you to be rich in the future. Each type of asset has different attributes so taking good care of them could maximize the value of your assets.
Robert Kiyosaki explains in Rich Dad Poor Dad that the first step in escaping the Rat Race and becoming rich is to understand the difference between assets and liabilities. It's actually very simple, assets make money flow into your pocket , debt will let money flow into other people's pockets. After understanding the difference between assets and liabilities, you should start accumulating your assets and avoid unnecessary expenses and expenses.
10 assets that make you richer:
Don't you think so?! Many large companies, such as Berkshire Hathaway, have a large amount of cash on hand, with up to $14,400,000,000 in cash in the second quarter of 2021.
There are 2 reasons to reserve a large amount of cash:
a. To seize the opportunity.
When the stock market crashed and everyone was panic-selling stocks, causing the stock market and assets to fall further, isn't this a real-life offer that value investors love most? At this time, those who hold a lot of cash can be happy to buy cheap stocks and seize the opportunity to double your net worth. This is called "Be greedy when others are fearful" .
b. P2P lending.
If you have money and are willing to take risks, you can consider lending funds to people in need through online lending platforms. Earn 10% to 18% high interest from it. As long as you save 10% to 20% of your income. You can ensure that you can seize the opportunity and prepare for the worst. So, life will only get better and better. Because every financial turmoil will cause wealth to be redistributed.
Investing in stocks is like buying a part of a business. If the business makes money every year, then this stock is your asset.
Stocks can bring you two kinds of income:
a. Dividend income
b. Spread benefit
You only need USD100 to invest in stocks. And as long as you do your research, it may bring you a 15% return on investment (ROI) every year. In fact, the method is very simple, spend 1~2 days a month, research stocks financial statements, and research trends.
3. Index Fund (ETFs)
If you don't have time and don't want to learn to research a stock, maybe index funds are more suitable for you. ETFs are passively managed funds. One of the benefits of investing in ETFs is that you can directly buy a basket of stocks, saving you the time of picking stocks can easily achieve the effect of risk diversification. For example: if you buy the S&P 500 index fund, it is equivalent to you buying different 500 US companies, including Apple, Amazon, Berkshire, Johnson & Johnson, Facebook, etc. The company's stock. The financial media CNBC reported that the S&P 500's return on investment in the past 90 years was 9.8%. It is a good return on investment. It is much stronger than the time deposit. If you invested USD10,000 in S&P 500 in 1991, and hold it for a long time, let it make a profit, by the end of 2020, you will have more than USD210,000 in assets. And during this whole process, you don't have to do anything. As long as you are patient waiting for it to make money for you.
4. Real estate
There are two types of real estate, one is for self-occupation and the other is for investment.
Owner-occupier real estate is a liability because you won't sell it, and you have to repay your mortgage every month. So you should carefully consider whether it will become a financial burden before you buy a real estate. Let you enter the never Endless Rat Race. And if you lose your job, it means you have nothing.
On the contrary, investing in real estate is an asset. Because it can help you bring rental income and become a landlord. At the same time, there is room for appreciation in the future.
Bonds are fixed income investment tools. You lend money to someone, and then they have to repay the principal plus interest to you within a specified period of time, say a year later, there are two main types of bonds: corporate bonds, and government bonds.
The biggest risk of buying a bond is that the counterparty might run away. You will lose your principal.
Government bonds are usually less risky, because the chance of her running away is very small. Unless the country runs away.
As for credit bonds, you can use credit Rating Credit Rating to measure their risk. The higher the credit rating of the company, the higher the probability that they will repay your principal. It is also more secure. And the lower the credit rating of the company, its risk is relatively higher, so it will give higher interest as compensation. In addition, the longer the maturity of the bond, the higher the interest they need to pay. So, have you seen that no matter what investment tool, the higher the volatility, the higher the investment rate of return.
6. Money making tools
Something brings you income, or tools that can increase your speed of making money. Both are an asset. For example: Uber driver's car. Youtuber's mobile phone, computer, professional microphone and other tools. Don't be stingy to invest in yours money making tools.
There are two types of employees:
A kind of cost, like water and electricity bills. Once it is used, it is gone, and the value that manpower can generate for the company is not high. It can be replaced at any time. For example, workers such as waiters or cleaners. The entry threshold is low, so it can be easily replaced.
Although talent needs cost, the value he/she brings to the company is much higher than his/her salary. For example, the sales champion brings huge sales to the company every month. Many customers are also willing to eat the dishes cooked by the chef, These talents are very important assets. Konosuke Matsushita, the god of Japanese management, also said: "The biggest asset of a company is people". If you are still an employee, remember to improve yourself and let yourself become irreplaceable talents. If you are the boss, also recruit more excellent talents, and invest in re-cultivation.
8. Patent Application or Copyright
If you are an inventor or creator, you need to know how to apply for patents and copyrights to protect your work. As long as it is your original creation, whether it is music, painting, books, or movies. You can apply for patents or copyrights , to prevent others from plagiarizing your ideas. Once you have applied for a patent or copyright, others cannot use your work casually. Therefore, at this time, you can ask them to pay your copyright fee to obtain the right to use. The patent also has a term, and to be updated regularly.
9. Intellectual Property
Everyone has some expertise, and if you put this knowledge and experience together, make a video, upload it to Youtube, or make a paid course, that's an asset that can bring you passive income. Knowledge products only need you a single investment of time can bring you unlimited income. Even when you are sleeping, others can still watch your videos or buy your courses.
10. Personal Branding
Personal image can also become a brand. Think about those super stars, Youtubers, vloggers, bloggers all have super popularity and attract a lot of fans. The high traffic brought by these fans is the business opportunity that manufacturers want. At this time, as long as there are sponsors to sponsor products or pay advertising fees, these youtubers will arrange product advertisements to attract traffic to click on the landing page. And the more subscribers, the higher your income will be.