Buying liabilities, things that doesn't have value five years from now. Many save but even when money is saved, it is done to spend and not to invest and the only way to become rich is to invest and not by savings. So , invest in assets and not liabilities.
Would you say a car is a liability? I use the car for logistics services and I know quite well that it will depreciate in value five years from now. So, how would you classify this- a liability because it will depreciate in value in the coming years or an asset because it will increase my company's revenue in the coming years?
I think the statement "
invest in assets and not liabilities." should be more expounded. When it comes to investing, there needs to be more clarity about what constitutes an asset versus a liability. Many people mistakenly believe that buying a big house or a fancy car is an asset when in reality, these are liabilities that drain your finances.
Instead, smart investors know that actual assets generate income and appreciate in value over time. This can include things like stocks, bonds, rental properties, or even a small business. These assets can grow your wealth and secure your financial future, which we can relate to the car which I assume is acquired through loan. In a sense, it is a liability because it is an obligation of past event that will result in an outflow, but at the same time the car (asset) is giving you an inflow through using it for logistics services.
That is why, it's important to do your research and make informed decisions when it comes to investing. You'll want to weigh the potential risks and rewards of any investment opportunity and make sure that you're confident with the level of risk involved no matter will be its results.