Many people have heard the word asset, but don’t have a full understanding of what it means…
Perhaps it is the fact that different things are assets for one person, but not another.
For instance, some people think their homes are an asset, while other people don’t.
If an asset is simply something you own that makes you money, well that is one idea of an asset. If an asset is a roof over your head and something that you use to get out of the weather, well that is another idea of an asset.
My definition of an asset is anything that adds to your life rather than subtracts from it.
For me, a house that meets my needs is an asset that adds to my life, while a house bigger then my needs starts to subtract from my life.
Of course it is wise to add assets that both add to your life and to your pocket book.
For some, a certain tool can be an asset, as it allows you to accomplish a certain task easier or better then you could without it. And you can often sell a tool to someone else for about the same price you paid for it. That certainly has the potential to be a big asset in your life.
Also friends and family can be a big asset in your life. They can help you when you are in need. And people really can enhance your life in a multitude of ways.
Of course, the reverse can hold true too. You can have friends and family that are simply takers rather then givers. Not just in one sense, but in every sense. In that case, they would turn out not to be a great asset in your life.
One word of advice is to be the biggest asset as possible to as many people as possible. If you are an asset to them you will often find them being an asset to you as well in the long run.
Perhaps that is the key to a life well lived…
To seek out and build as many assets as possible.
This is our 34th challenge in The Personal Finance Challenge Series…