ASSETS – is it right asset that you have invested from your saving?

In most studies people has been made to understand that asset is important to us. In accounting assets are classified under fixed assets and current assets. Below are listed some sample of assets as in principles of accounting:

Fixed assets
- Buildings
- Land
- Cars
- Equipments

Current Assets
- Fixed Deposits
- Shares
- Bonds

In business, debtors are also included under current assets. However for fixed assets such as equipments and cars undergoes depreciations. After certain years the net book value of the assets is much lower than the purchased price.

This is different from assets such as fixed deposits, bonds, and the lucrative assets that is land. The price shows some appreciation from time to time and for the land the appreciations is much higher than the day of purchased. The house even would shows some immediate appreciation if it is an auction house. That goes to the land too.

So where to invest

In many of my lectures, a have advice the students that if investment are to be made, a careful understanding on the type of assets to be invested is very crucial. I have met friends, clients and people who has been asking me what assets to invest and would immediately put up an opinion to invest in appreciative assets.

Some people ask me, if they have money, what business they should be in. I told them, “If you have money, don’t do business. Only if you don’t have money, you start doing business.” All of them were stunt.

I have always advice that if we have money then invest, divest then invest. But the investment must be in appreciative assets. After a certain calculated appreciation or after meeting the target return (ROI) that we want we can divest the assets and prepare for another investment. In between enjoy your profits.

All of them thank me until now.