gtghost,

How do you come up a budget of 200K to 250K?? And, if you have a budget of 200K to 250K, you cannot afford a house that is price at 200K to 250K. The reason is there are additional costs associated in buying and straying in a house.

For example, it costs on the average of 30K to move in a house. So, just by deducting 30K, you can only afford a house that is 170K to 220K. Plus, we have not factored in ALL other costs.

How much monthly loan payment can you pay per month?? For example, you should not pay MORE than 25% of your monthly gross income on house.

The point that I am trying to bring up is you have not done a proper calculation to find out how much house can you afford. And, the house that you lived in is NOT AN INVESTMENT. It is a LIABILITY.

Dreamer

tinkerbel,

That is YOUR OPINION. And, it is not share by me and many others in our wealth building path. We judge an asset by cash flow.

An asset is something that give you money every month. The house that you live in does not give you money every month unless you rent it out. In fact, you have to pay money every month to maintain your house. It is an expense. And, it does not matter how much the house is appreciated. It means nothing until you sell it. And, when you sell the house that you live in, you have to buy or rent another to live in.

Dreamer

tinkerbel,

1) That is YOUR OPINION and YOUR WAY of looking at things. And, you are what you believe. IMHO, anything that does not generate positive cash flow is NOT an asset.

2) In your system of belief, when you buy something and you own it aka even a TV, you think you have an asset and your net worth is increasing. In my system of belief, anything that does not make money for me is not an asset. So, between you and me, who is going to spend more money on things that does not make money?? You or me?? You are what you believe.


Dreamer

yewkhuay,

1) Average people are not rich and rich people are not average. You have a choice. You can choose to be average or rich. You cannot be both.

2) Rich people do not look at things the same as average people. And, they are NOT limited or use the definition of normal people.

3) My definition of asset is based on cash flow basis. Anything that does not generate positive cash flow is NOT an asset.

4) In my book, appreciation is NOT REAL. It is not cash flow. Until you can sell that thing and get some money, it is ALL PAPER PROFIT.

So, do you want to be RIGHT or RICH. And, that is the question. Normal and average people use definition and way of looking at thing that cause them to waste money as opposed to using money to generate wealth.

I would rather be RICH than RIGHT.

Dreamer

This post has been edited by dreamer101: Nov 29 2007, 10:15 PM

jasontoh,

You have contradicted yourself.

<<Definition of asset is not important, if u know how to make money.>>

If you believe this, then, being right is irrelevant to you. You only care about making money.

<<We can always right and rich at the same time.>

If you believe in this, then, you do not believe definition of asset is not important.

Which one do you choose?? What is more important to you??

Dreamer

yewkhuay,

<<read my post carefully , i was commenting tinkerbel is right at her point of view, >>

You do not get IT. My POV is that kind of POV will not help a person to get rich. And, it is HARMFUL in the path of gathering wealth. A person's POV shape what a person believe. And, that determines whether a person is average or
rich.

You are what you believe.

Dreamer

Pai,

1) Only cash flow positive investment are assets. Anything else are liabilities.

2) House that you lived in is liability unless you rent part of your house out and it is cash flow positive./

In USA as for many in Malaysia too, people think that the house that they live in is an asset. Because of that flawed thinking, they spent TOO MUCH on the house that they live in and tied up most ofl their money. So, the house is the only "ASSET" that they have. They are house rich and have nothing else.

Dreamer

This post has been edited by dreamer101: Dec 5 2007, 10:17 AM