Assets vs. Liabilities
On reading the title you must be surprised, why am I writing about such a basic thing, but don’t worry, I will present both these terms in a different perspective. Traditionally “Asset” means property, land, building, furniture, vehicles and it also includes intangible assets like goodwill, patents etc. i.e anything on which the person has “Rights” and can execute his/her will for using, destroying or selling the same. You will find all such assets on the asset side of the balance sheet. Liabilities are the financial obligations that are to be honored at pre-decided time or sometime. If we look at the assets and liabilities with different lenses, we will be surprised to find how many assets we hold, actually are liabilities. Liabilities are invariably the same and don’t need explanation, one must be aware of the compounding effect on our liabilities as well. Robert Kiyosaki in his book “Rich Dad Poor Dad” has given a fantastic definition of assets and liabilities. H...