There are four types of income generating assets in general:
1. Human assets, i.e. your skills, your labour, your knowledge, your capabilities, etc.
2. Paper assets, i.e. stocks, bonds, etc.
3. Real estates, and
These assets put money, the recurring monthly income, into your pockets.
Set your financial goals in terms of sustainable and recurring monthly income. Maximize the income generating capability of your assets*. As you grow older the income generating pattern should change. You move away your income generating assets from human assets, i.e. your time and labour, to financial assets, i.e. businesses, stocks, real estates, etc. You must then remember to protect these assets accordingly.
* When we talk about assets, we are referring to assets and liabilities in terms of financial only. We use Robert Kiyosaki's definition of assets and liabilities: assets put money into your pocket and liabilities take money away from you pocket. So having a big house and a big car that you have to maintain but not generating income are liabilities even though they are probably assets in terms of quality of life. So children are, strictly financial, liabilities even though they are God-given blessing to our life and are our most precious assets (not in financial terms), and that we are more than happy to have such financial liabilities in exchange for their existence.
It is indeed all about "Income Generating Assets", OR assets(i).
Part 1 : The conventional idea
Part 2 : The breakaway wisdom: income and assets
Part 3 : Building assets(i)
Part 4 : Assets(i) planning
Part 5 : Further exploration on the principle
1. The principle in a nutshell
2. Definition of assets(i)
3. Classes of assets(i)