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How to live comfortably
Rank: New-farer Joined: 12/15/2010 Posts: 5 Location: Nairobi, Kenya
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My two cents. There is a big diff btwn owning a house in the US/UK vs Kenya. In the US/UK kuna property tax, statutory insurance, maintenance, neighbourhood laws etc...a lot of money to pay every month/year. In some places you cannot even inherit a house for free like here, you have to pay tax on it hata kama ni ya baba yako. Thus, bottom line it "takes" money away from your pocket and i guess is the reason Kiyosaki classifies it as a liability.
The appreciation of the house will only be beneficial if you plan to sell it or if you take a loan against it to do some other business.
Here in Kenya, what you pay to keep your own house is very minimal and this why some members find this logic of a house being a liability 'faulty'.
Also, would you rather put down 5M on a house and save yourself 50K rent monthly, OR would you rather invest 5M in a business and generate enough to pay your rent plus more to invest?
In my opinion, both options are viable to a certain degree.
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Rank: Elder Joined: 5/24/2007 Posts: 1,805
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In my opinion, a house is an investment. Just that the return on investment is very low. As it appreciates, you can sell and move on higher. Investing in a business is little more risky and so you can either make money or lose. not so with your house in kenya. You ALWAYS earn some rent every month. I Think Therefore I Am
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Rank: Elder Joined: 5/30/2009 Posts: 1,390
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babyelephant wrote:My two cents. There is a big diff btwn owning a house in the US/UK vs Kenya. In the US/UK kuna property tax, statutory insurance, maintenance, neighbourhood laws etc...a lot of money to pay every month/year. In some places you cannot even inherit a house for free like here, you have to pay tax on it hata kama ni ya baba yako. Thus, bottom line it "takes" money away from your pocket and i guess is the reason Kiyosaki classifies it as a liability.
Thanks bro.We should think of our context But guys here have nice points.Thinking about it, it can only be an asset.The question is not whether it is an asset or not.The question is whetgher it is worthwhile buying that asset now or investing it elsewhere What a wicked man I am!The things I want to do,I don't do.The things I don't want to do I find myself doing
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Rank: Veteran Joined: 6/2/2010 Posts: 1,091
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HOUSE IS AN ASSET!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
So if I choose to live in my house it is not an asset...
but if I rent out the same house for say 30K and then use that money to rent a similar house to live in then it is an asset?????
Cmon do not take Robert Kick-you-in-the-sacki literally
He is rich because you keep buying his bullcrap books
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Rank: Member Joined: 8/26/2010 Posts: 124
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@babyelephant- you my brother/sister. I back you up,you said it the right way. The 5m is better of somewhere else.
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Rank: Member Joined: 3/17/2008 Posts: 567 Location: Nairobi
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Who says that getting a home and investing are mutually exclusive????
I home is a real estate investment with all the trappings of the investment plus personal security.
For those who would rather invest the 5M and get returns to pay rent they only misconception here is that the 5M home saves you the rent and appreciates in value. In addition try getting a 3M loan to buy a another investment, see what question your bank will ask you first. DO YOU OWN YOUR HOME??
I once discussed with JM (Equity) and he told me of a kikuyu saying 'mundu dage tonga na ido ciake' roughly translated to mean you cannot get rich with your resources only. You need ideas and financial resources to cross the bridge.
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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"The richest man in babylon" advises you to own the home you live in, let your wife cultivate the garden therein and enjoy the fruits and vegs therefrom. A home is a social investment. It would also cushion you from distress if you lost your source of income, give you time to start another enterprise. 50k in Rent paid is money spent but if applied to repay a mortgage, it gets you 3m worth of equity in your home in 5yrs! I agree with @tototusker that Perhaps rich dad is targeted at the american consumer society where one must have a townhouse, cabin up the mountains and a summer home in hawai, florida or the meditereanian. These homes are clearly not assets. Without fear of contradiction, i state that a personal car is an asset in some instances Life is short. Live passionately.
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Rank: Member Joined: 1/20/2009 Posts: 73
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asset or liability?
i am 2 work 4 20 years b4 retiring.
option1.
rent: 35000/- * 12*20 = 8400000/-
pay the house rent, retire and go home empty handed.
option2.
plot: 500000/-
loan to build a house 3500000/-
total cost 4000000/-
repayment within 5years.
after 5 ers one have a house n no more house rent. retire at 20th er, go 2 shaggs n rent out the house n eat the pension
verdict? so a house is an asset n only time can tell so!! 10 cents
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Rank: Elder Joined: 6/20/2007 Posts: 2,075 Location: Lagos, Nigeria
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To live comfortably do not live in a rented house, live in your own house. Have multiple income streams,rents,dividends,other investment income. The wazua spirit as members is to educate and inform and learn from others within the limit of what we know in any chosen area irrespective of our differences in tribes, nationalities, etc. .
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Rank: Member Joined: 12/3/2008 Posts: 113
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mwenza wrote:gohill wrote:X13united wrote:If Robert .K bumps on this thread,he will perhaps spank some of our veterans n of course send them back to the 'hallo' n 'new f'. The rule of thumb applies all round n it states- kiyosukis first law- if it is not putting money in your pocket/bank acc/investment plans then its a liability. NOTE: The word is 'put' money n not 'save' rent as some veterans are interpreting. Must i always do things as per Kiyosukis first law? I have my own laws and that's why i say that ka plot i have is an asset. Ha came with that law so that he can sell that book to you and take money from you(on a light note lakini). @gohill.........Some people think that the written word is law. Thats why we have so many schooled people who are not educated. Kiyosaki this kiyosaki that! many people are being fooled by this motivational books.if all investment knowledge was in books then librarians would be millionares.
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