Re: Asset and liability, one key factor for poverty among most Africans
Conclusion
👉👉Let 70%- 80% of your income goes to asset. It is better to invest ones money on asset than getting liabilities that will bring no income.
👉👉Only acquire liability if the liability will add value to you, your business or improve the income made in your business.
👉👉Only acquire liability after gotten a good investment that is capable of providing enough returns for your home and the liability purchased maintenances.
👉👉Let 70%- 80% of your income goes to asset. It is better to invest ones money on asset than getting liabilities that will bring no income.
👉👉Only acquire liability if the liability will add value to you, your business or improve the income made in your business.
👉👉Only acquire liability after gotten a good investment that is capable of providing enough returns for your home and the liability purchased maintenances.
First of all its is not really possible to expect someone to invest their 70% of their income, even if they invested 20 to 30% then they will attain financial freedom sooner and probably can live the life sfter retirement peacefully. So I just wanted to keep the amount to somewhat realistic which is 25%.
Better realize the difference between needs and wants so they can spend money economically.
And most of all better to know reality than illusion. I wonder how can an average earner person survive if 70% to 80% of his income goes to assets. People have to pay rentals, monthly bills, and personal maintenance, food, transportation etc.. For a normal employee or a minimum wage earner, it is lucky to have an excess of 20% of their monthly salary. In my place in order for me to safely invest my 70% income, I need to earn at least $5k per month which is impossible because the minimum wage in my country is only $10.15 per day taxes and miscellaneous charges haven't been deducted from that. It is ideal to save and invest but the percentage OP is suggesting is way overkill!
This is very true. Not all people can afford to allot even 20% of their earnings to assets especially if you are just a minimum wage earner. Even if you say you are frugal with your life, still there are basic needs that you need to pay. You would be more than happy to even spare 5% of your earnings to your savings if your wage is just an average earner.