Assets put money in your pocket and build your Balance Sheet
All you need to know is that assets will give you money and the more you have – the more rich you will be- yes that simple.
Try and you look around you and see what things give you money (excluding your parents). Things like money in a savings account is an asset as it will put money in your pocket by the bank paying you interest.
Look at things like buildings,land equipment – these are all examples of physical assets – think also how they put money into the pockets of people or companies that own the asset- for example rent received from the building or products made by equipment for example if you have a coffee machine you can sell coffees .
Banks give you money – but this is never for free – the reason that they are able to do this is that they have large assets which generate millions of dollars of income – I know this is very simple but essentially this is how it works.
The thing I want you to remember here is that you need to acquire assets – small ones to start off with and then over time, something called the compound affect will kick in – I will explain the compound affect in another definition.
An asset can also be knowledge that you have e.g. say you are an expert in drawing funny pictures – you can then sell these pictures to other people or teach them how to draw and charge money for teaching people to draw.
