The main discussion question for this month: "Is your home an asset?"

Many financially uneducated people believe that cars and homes are assets and we can't really blame them. Advertisements for insurance products for example tell them to "protect their assets". I also have to laugh when Best Buy tells me to "protect my investment" when buying an HDTV, something we call a Doodad.

Within the Rich Dad circle we use a definition of assets and liabilities that takes a slightly different view than traditional accounting would. We feel it makes it easier for people to understand how cashflow and property relate to each other.

Rich Dad defines an asset as a property (real estate, business, or intellectual) that puts net income in your pocket. A liability is considered any property that takes money out of your pocket after it's all said and done.
Your primary residence for example is not considered an asset unless it is creating more in income than expenses. So unless you take the bus and are renting part of your house out, you will always have certain liabilities.

Lets discuss this at our meetup in January! Happy holidays everyone!
-Tiemen
WorkForNobody.com