The rich buy assets, the poor buy liabilities

The phrase “The rich buy assets, the poor buy liabilities” became famous with the book Rich Dad Poor Dad as it was one of the lessons Rich Dad allegedly taught to author Robert Kiyosaki. The book is a worldwide bestseller, but it’s been criticized on many of the points it advocates.

picture money can't buy happinessI’ve been thinking about that phrase – Rich buy assets, poor buy liabilites – I’ve been thinking about it quite a lot. Especially since our newlywed money and finance is not in a great shape. Is the secret key to getting rich that simple – just buy assets instead of liabilities?

It makes perfect sense to put your money into stuff that pays you back – like a rental property or a stock portfolio; investing is all about putting money into stuff that will help you make more money later. But us humans are so gullible! We have a hard time saying “no” to that seductive, shiny, brand new flat screen that is way cooler than the flat screen Peter bought last month (and made rounds at the office bragging to everyone about it). So we buy it and do a little Tarzan-style victory dance in front of Peter’s desk. Take that, Peter!

According to Kiyosaki, the rich invest their money by buying things called “assets” – things that put money in your pocket like rental properties or stock portfolios. The poorspend their money on things called “liabilities” – things that are basically money-pits and never put money in your pocket. Like that flat screen we were eager to rub in Peter’s face.

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Strategies for getting rich: savings vs. skills

We all want to be rich. But few of us are ready to work at it.

You know how some people say “I don’t want to be rich?” Haha! Does that mean that if they won the lottary, they would just give the money away because they “don’t want to be rich?” Of course not.

What these people mean is they DO want to be rich (or at least won’t mind being rich), but they don’t want it bad enough to put in the effort. And they don’t want to  put in the effort because they think it’s TOO MUCH effort.

It’s not. No it’s not. Many people think that being rich is suuuuper hard, but that’s just because they are working at it the wrong way: by working. Try this instead:

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10 tips: Improve your chance of getting rich

Dream bubble
Dream bubble. Src: Google images

One winter night in Sofia, all dorms were dark except for one: ours.

Sitting in bed in our pajamas, my roomies and I were talking about how we’ll decorate our houses some day. Imagination knows no limits: we talked about pools and gardens and romantic dark bedrooms.

We chirped well into the little hours, and then my roommate said: “You know guys, no one ever sees themselves being poor in the future. Everyone imagines they are rich, or at least much better from now. But it doesn’t always turn that way.”

I could hear our three dream bubbles go pop, pop, pop.

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