The rich people focus on acquiring assets. Rich Dad Poor Dad book taught about the right assets that rich people acquire. Those are income generating assets. Before, I thought buying a house is buying an asset. I learned that a house can only be classified as an asset when it generates income such as being used as rental property. But if a house is being used by the owner, it is more of a liability as it has related expenses such as interest payments on mortgage and repairs. On the side note, this is a different identification of assets and liabilities in accounting.
In addition, purchasing a house requires use of large amount of cash as down payment which could have been used in starting a business or in investments. This is called opportunity cost.
I am not saying that buying a house is a bad decision. I agree that it is a personal decision. You may also check my other blog post on guide in buying a house to know if it is worthy to buy a house than to rent and vice versa.
To sum it up, acquire assets that generates income. I invite you to join me in my newsletter for free, just visit KevinUmali.com/free