Key Takeaways
- There are 3 types of assets:
- Productive assets
- Non-productive assets
- Limited assets
- Wealthy people reach sustainable wealth by having enough productive assets to provide them a stable monthly income that supports their financial freedom.
Terms
Productive Assets: are assets that can provide you with a stable monthly income. A rental income property or dividend-paying stocks are common examples, but another example is a business you own, either as an owner/operator or as a silent partner. Those can all be examples of productive assets.
Non-Productive Assets: are assets that depreciate in value and don’t provide you with an income. Some examples would be your car, boat, recreational vehicle, the furniture in your home, the clothes in your closet, etc.
Limited Assets: are assets that do appreciate in value, but don’t provide you with an income. That might include artwork, collectibles, classic cars, etc. But, another limited asset that often surprises people is their home. Yes, while income-producing real estate is a productive asset, the home you live in is actually a limited asset because, while it can appreciate in value, it doesn’t provide you a stable monthly income while you’re living in it.
Instructions
Note: you will notice an emergency savings account and a general savings account are already listed. It’s okay if you don’t have either account set up yet, but we include them automatically because they play a key role in a later step.
Follow the instructions below to record your asset accounts:
- Click the 3 dots in the drop-down for the emergency savings account. You will see your account details pop up.
- Fill out each field accordingly and then click save.
- Click "add asset account" and choose your account type.
- Fill out each field accordingly and then click save.
- Repeat step 3 and 4 for each asset account you have.