Active or passive asset management? The traps of narrow-minded perception

The investor's way of thinking is radically different from the perception of an average person. To effectively manage your money, you need to learn to distinguish assets from liabilities and realize that the same purchase can become an asset or a liability, depending on the purpose of the purchase.

In the book "The Way to Financial Freedom", its author Eric Nyman provides a table that will help you understand how the same item, mastered skill, or purchased product can change its status. This means that it can become a source of income or expenses for you.

The well-known author Robert Kiyosaki taught us a simple rule: the fewer liabilities and the more assets there are on the balance sheet, the better things are going. We do not expect you to immediately rush to sell your car or apartment, but you must clearly understand which items of your property bring money and which ones - take it away.

This simple analysis will make you part with a lot of illusions. It is the irrational desires to buy a new phone, car or go to an expensive restaurant that deprive us of possible profit, because the money spent can buy shares or bonds that will eventually bring income.

If you are ready to change your perception and start thinking like a professional investor, save our infographic on your wall!