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“If you want to be rich, you’ve got to read and understand numbers If I louis vuitton online heard that once, I heard it a thousand times from my rich dadAnd I also heard, “The rich acquire assets and the poor and middle class acquire liabilities
Here is how to tell the difference between an asset and a liabilityMost accountants and financial professionals do net agree with the definitions, but these simple drawings were the start of strong hermes bag financial foundations for two young boys
To teach pre?teen boys, rich dad kept everything simple, using as many pictures as possible, as few words as possible, and no numbers for years
“This is the Cash Flow pattern of an asset
The above box is an Income Statement, often called a Profit and Loss StatementIt measures income and expensesMoney in and money purse louis vuitton outThe bottom diagram is the Balance SheetIt is called that because it is
supposed to balance assets against liabilitiesMany financial novices don’t know the relationship between the Income Statement and the Balance SheetThat relationship is vital to understand
The primary cause of financial struggle is simply not knowing the difference between an asset and a cartier watch santos liabilityThe cause of the confusion is found in the definition of the two wordsIf you want a lesson in confusion, simply look up the words “asset” and “liability” in the dictionary
Now it may make sense to trained accountants, but to the average person, it may as well be written in MandarinYou read the words in the definition, but true comprehension is tiffany heart tag diffi
