How to Identify Your Assets & What They Can Do to Build Your Wealth

| June 2, 2017 | 0 Comments

Building wealth comes down to the assets and liabilities that are part of your financial picture. An asset is anything that produces income or grows in value. Liabilities are everything else.

Buying for a boat, for instance, is a poor financial choice if it will never appreciate in value enough to make up for the money you put into it. Here are some positive investments that you can use to build your assets.

Buy Real Estate

Given a positive economic climate, real estate nearly always grows in value. This can be anything from house “flips” to commercial or residential rental properties. As you make payments, your mortgage balance goes down and your equity improves.

9 Ways To Build Wealth Fast (That Your Financial Advisor Might Not …

Those who know me know how much I love the Roth IRA. I love it so much in fact that I tried to convince my wife to name our third son “Roth.

 

You can borrow against this equity, or sell the property and pocket the profit as funds for other investments. Equity takes time to build, however, relative to the interest and insurance you’re paying. Be certain the profit you’ll make outweighs the costs of insurance, taxes, interest, and upkeep.

Invest in Companies

You don’t necessarily have to launch your own enterprise to reap the profits. Many established businesses look for investors to raise the capital they need for major expansions or other initiatives.

In return, you receive a share of profits proportional to your investment. Backing the right company ensures you a steady income stream at no effort. This is called passive income.

Shop for Antiques and Collectibles

Collectibles like antiques, rare coins, gems, precious metals, and art generally rise in value over time. Their worth is a matter of scarcity and relative quality, but also demand.

Value can also take sharp drops if other collectors lose interest. If you have or can acquire some expertise in these markets, buying and selling the right items at the opportune time can realize substantial profits.

Purchase Financial Instruments

Investment portfolios are generally built around financial products. It’s important to buy varied financial products that give the best chance of minimizing losses and optimizing returns.

Time-Tested Tactics to Build Your Wealth

We have doled out a lot of good advice over the 70 years we’ve been publishing Kiplinger’s Personal Finance magazine. So in many ways it was easy to come …

 

There are a wide variety of financial instruments, such as stocks, mutual funds, futures, foreign currencies, and more. To understand how to make this work for you, it’s best to consult with a knowledgeable wealth management expert, like those at State Bank of Cross Plains, who can find the best investments to meet your budget and financial goals.

Every rich person’s goal is not gambling on meteoric profits, but establishing passive income that will be re-invested to produce more passive income. Help in picking the right investments is a wealth manager’s specialty.

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