Your Feet Shouldn’t Look Better Than Your Ass…ets

If you’re like me you enjoy looking beautiful and seeing other people looking beautiful too. You enjoy high quality, pretty purses and great looking shoes. You like shiny diamonds and brilliant gold. You love fabulous meals and vacations and luxury cars and beautiful homes. All the things that bring beauty are appreciated, but do they appreciate?

Most of what I listed will not because they are liabilities, not assets.

I’m sure it’s easy to decipher one from the other for the most part but there’s one in particular that trips people up sometimes, before I get into that allow me to quickly review the monetary difference between assets and liabilities with the simplest terms.

Assets have the ability to make you money

Liabilities cost you money

I don’t know about you but my mom taught me of the importance of having quality jewelry and there were a couple times in my life I found myself cashing in on that advice. Quality jewelry, especially gold and silver (I adore Tiffany, hint..hint future husband) will increase in value, making it a beautiful investment.

Nice cars, not so much because they depreciate in value incredibly fast, but! If you were to use your car as a source of income through ride-sharing or rental services it becomes an asset.

While new shoes and purses can be resold for a pretty penny you’re not making a profit which makes them a liability.

Now, let’s talk about the one that brings about some confusion. Beautiful homes. Now, I’ve got my real estate license and my mom and sisters are both realtors so we’ve talked about this and we agree, unless your home is paid off and you’re somehow making money on it with Vrbo or AirBnB, your HOME is a liability.

“But I can sell it and I have equity in it.”

You’re absolutely right, you CAN sell it but until then you still have property tax to cover, utilities, possibly your mortgage and you honestly don’t know the value of it until it’s sold because even it appraises well, its worth is determined by what another is willing to pay.

But if you own rental property, as long as it’s bringing in more money than it’s costing you it's an asset.

So super simple right!?

So before your swipe your card ask yourself, is this costing me money, or is this an investment?