As a business owner it is important we clearly understand the difference between assets and liabilities. The truth is often people have no idea what these two really mean. You see businesses in real estate constantly fighting these words. Everything from opening many locations to buying useless tech the liabilities keep stacking up. Sometimes in business it can not be all about gaining more sales to earn more money.
Assets are items that we own or control that generate wealth. Assets in real estate businesses come in many forms. We have signs, leads, our contact list, and many other things. Teammates when paid commission only may also be on the fringe of being called an asset. What is not is the fancy car you’re driving, the watch, the suit, and other items that we see so many people put so much into. Do not get me wrong it is important to look the part. That said it is important to be the part if you are going to look the part.
Liabilities are items that we own or control that cost us money to keep. While often people look at cars, boats, homes, and other items as an asset most often they are a liability. Even the shirt on your back is a liability in the essence that you will need to wash it, store it, move it, and so on. The key thing to remember is that liabilities while necessary need to be limited. When making decisions on these items take your time and think about the true cost.
Wealth is the measure of time you have when you stop working that you can survive without a paycheck from a job. If you learn to take money away from yourself as you earn it and put it into income producing assets you will be able to watch your wealth grow. While not every investment is going to bear fruit making the choice to take calculated risks is needed. If you learn to apply this to your business and personal life you too will become wealthy. If you enjoyed this blog you should check out our Facebook Group, Podcast, Newsletter, and website Real Facts on Real Estate.