Topic: Asset and liability, one key factor for poverty among most Africans - page 2. (Read 229 times)

This is just an assumption, you can't speak for all Africans especially Nigerians, especially since you cannot tell all our preferences exactly. If you make this claim, you should have at least attached a source for your data.

The debate between what exactly we can call an Asset and Liability will continue for a while as I believe that some things that some people may consider as liabilities may be assets to other persons, it all depends on usage IMO. A car for instance which may be considered a liability to some, can be a asset to a business person who uses it to facilitate their business in form of logistics or transport services to bring profit, which is also in line of what an asset is.

You spend majorly on maintenance and repairs when you buy a fairly used or not too good item, in this case a phone or a car. If you can get a good one in very good working condition, it will be a while before you talk maintenance and repair, it would have served you already a lot and possibly made you some good returns already.

I doubt a lot of people are spending that much on debt without being incentivised to do it (eg high inflation and low interest).

Quality of life depends on where and how you live but it's much more than the assets and liabilities you might acquire.

You can't call a mortgage a liability somewhere (if house prices don't rise much) and then call it an asset builder somewhere else because house prices are soaring there (you still need a house near social or work connections).

There’s a good debt and bad debt, you should be more aware the difference between this two and take advantage of what works for you. Asset can be your liability as well, don’t get be fooled by any investment that promise easy profit because it’s too risky.

What’s your basis about Africans getting into more liability than to focus on creating more asset that generates income? Most probably they are into debt because it left them with no choice, the problem there is poverty and corruption.

I completely disagree with this brazen claim of yours, what statistics or proof do you have to back it up that Africans (Nigerians more specifically like you said) are more concerned about acquiring things that are liabilities to them, than stacking up assets; i can categorically state that it is wholly untrue. You can prolly call it a human trait, but to pinpoint a particular people as doing it more without stats is uncalled-for.

Having said that, you quite forget that in most parts of Africa people live below the poverty level, some even earn less than $2 a day, quite a lot of them are basically concerned about what to eat, wear, good water, etc, that they can't even condition their minds to dream of acquiring luxurious items, only the wealthy/rich can afford it there. It is in parts of the world where life is much better, first world countries were people earn a reasonable minimum wage that you could talk about even the middle class citizens leading a somewhat comfortable life.

What is asset? What is liability? Assets are the items you owns that can provide future economic benefit while liabilities are things we own with future obligations. In a simple definition, assets are things we buy that will bring money back to us while liabilities are things we buy that we will keep spending money on. Assets put money in your pocket while liabilities take money out of your pocket.

Most Africans especially Nigerians prefer liability to asset. In the journey of becoming a successful being, it is advisable to acquire more assets than liabilities. The questions here is where does 70%- 80% of your income goes? Asset or liability?

Imagine someone that can hardly feed himself twice daily buying an expensive phones and cars without a specific purpose (just for fashion). This is the different between the rich and the poor. The rich invest in what can fetch them more money (asset) e.g buying land, investing in reputable businesses but the poor out of fashion keep buying liabilities (goods that they keep on spending their little earnings on for maintenance). If 70%- 80% of your income goes to liability then one is preparing for a poor life.

I'm not saying buying expensive phones and cars isn't good but shouldn't be priority over ones investment. Phones and cars maintenance in some countries are expensive. So this may prevent one from saving if one acquire it without a good job.

Conclusion
👉👉Let 70%- 80% of your income goes to asset. It is better to invest ones money on asset than getting liabilities that will bring no income.

👉👉Only acquire liability if the liability will add value to you, your business or improve the income made in your business.

👉👉Only acquire liability after gotten a good investment that is capable of providing enough returns for your home and the liability purchased maintenances.