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Many people don’t know the difference between asset and liability, and as a result, most of those people struggle financially. Basically, an asset is something that is going to add money to your bank account or pocket, and a liability is something that’s going to take the money from your bank account or pocket.
When some people buy a car or a house, they think this thing is an asset. However, it’s usually a liability. If you buy a car and the car has a certain value, the value will go down the day you take it out from the dealership. There also are expenses related to the car that you are going to pay for over time, such as service, going through the car wash, insurance, and parking fees. A car basically is a liability because it’s taking money from your pocket.
If you want to understand the main differances between the Employees, Self Employed people, Business Owners and Investors, this Books is a must read book and one of the top 3 books ever written by Robert Kiyosaki, you can get the book by clicking here