Banks have successfully spread the rumour that buying a house is an investment 😭😭 they tell you a how is an "asset" 😩 so when I started making real money I bought this "asset" πŸ™†πŸΏ
Issa TRAP!! A house is a liability my people, it will drain money out of you. If you bought a 1M house (which is 3 bed/2 bath, nothing fancy) You will be expected to pay the following:

Bond = R8,900 which is really R3,000 capital and R4,900 interest for the BANK!! 😱
Rates = R1,200 monthly to the municipality
Maintenance = +/- 10K per annum JUST to make it stay the same way.
That is 7K you are paying MONTHLY that is not paying for your bond!! someone said "When you rent you are paying someone else's bond 😩😩" my dear friend, when you have a bond you are paying the banks interest 60% of the premium the first 7 - 9 years

What the banks DON'T want you to realise is that you don't OWN your home!! You are renting it from the bank at a MUCH higher price. This is why it's better to rent a cottage (Save on rates, save on home maintenance, save on banks interest) and rather invest your time an money in building an income stream that will allow you to buy πŸ‘‡πŸΎ that house.

Your current house is NOT yours it belongs to FNB and it's NOT an asset!! If you haven't yet bought a home PLEASE πŸ™πŸΏ calculate the true cost of your purchase and realise that what you are buying is "Social Inclusion"
If you are younger than 40 you should be focussing on buying cash generating assets NOT putting yourself in bondage, OFCOURSE they want you to think you will make money when you sell it ask yourself "Is it true?" house prices have dropped at worst and stayed stagnant at most the last decade.

We are getting into debt too early and never coming out, I meet 27yr olds with 600K vehicles and 800K homes and I want to cry because that's 2.5M debt that they want me to celebrate 😩😩
Each time a black person buys a new car we should fast because it's another one biting the dust! 😭😭that's ✋🏾 5 years of debt that they have bought and bond = bondage!! Who wants to be in bondage?
Rent!! better yet get a commune or stay at home in the back room whilst you build but best of all get land and build πŸ‘‡πŸΎ

Your House is an Asset

It seems like every financial “expert” says, “Your house is your biggest asset.” When I wrote Rich Dad Poor Dad, I said that your house was a liability. That was like spraying water on a hornets’ nest. The so-called experts lambasted me. At the time, the real estate market was skyrocketing. Everyone called me a contrarian, out to sell books. Today, after one of the worst housing crashes in US history, they aren’t laughing anymore.

Recently, I’ve been writing a series of posts on what I’m calling Rich Dad Scams, lies that are fed to people by the rich to keep them poor and in the middle class. Today, I’m going to write on one of the biggest Rich Dad Scams of all, “Your house is an asset.”

Money in, money out

Your financial planner, real estate agent, and accountant all call your house an asset. But in reality, an asset is only something that puts money in your pocket. If you have a house that you rent out to tenants, then it’s an asset. If you have a house, paid for or not, that you live in, then it can’t be an asset. Instead of putting money in your pocket, it takes money out of your pocket. That is the simple definition of a liability.

This is doubly true if you don’t own your home yet. Then it’s the bank’s asset, and it is working for them, but it’s not earning you anything.

So what is an asset?

In business terms, assets are your pros and liabilities are your cons. You need assets to offset your liabilities. Once you get away from the Rich Dad Scams, it’s easier to think in those terms, to think like an entrepreneur. But what exactly are assets?

The simple definition of an asset is something that puts money in your pocket. This is accomplished through four different categories, one of which is real estate. When I say real estate, I don’t mean your personal residence, which is a liability. What I mean is investment real estate, which is a great investment because it puts money in your pocket each month in the form of rent.

There are three other primary assets: business, paper, and commodities. If you are an entrepreneur or a business owner, your business is an asset. Paper assets are stocks, bonds, mutual funds, and so on. Finally, commodities include gold, and other resources like oil and gas, and so on.

My wife and I started out making our money in real estate, putting our money to work in properties that we could rent them out and see ongoing returns. After that, we diversified, so now we have some money in all of four of these asset areas.

Invest for cash flow, not appreciation

The Rich Dad Scam that your home is an asset was prevalent when I first wrote Rich Dad Poor Dad. That was in 1997, and everyone’s home values were climbing. It was easy to assume that your house was an asset because it was potentially making money for you in the long run through appreciation. People bought into the scam hook, line, and sinker, taking out home equity loans to buy cars, vacations, TV’s, and more. Today, those same people are so underwater that many of them are defaulting and going into foreclosure. Most people aren’t saying their home is an asset any longer.

A lot of Americans got a fast, ugly financial education when the real estate market turned around. They realized very quickly that their homes were not assets.

The difference between my poor dad and my rich dad was a financial education. And that’s not a classroom and books education, that’s a nuts-and-bolts, street-smart education, a way of looking at money that is true and that works, not just what the rich want you to believe.

Rather than invest for appreciation, my rich dad taught me to invest for cash flow and to treat appreciation like icing on a cake. I encourage you to do the same.