Personal Money Tips

I came to this conclusion. Cash is no longer an asset! Yeah, you read correctly. With inflation rearing its head rather alarmingly, prices of almost everything has gone up. I’ve noticed something happening over the past few months and wonder whether cash can still be considered an asset.

When I say cash, I mean anything that’s liquid that gives you very low return.

If you define an asset as something that will either :

• grow in value over time, or
• produce an income or throw off interest,

then, I have to say that cash is no longer an asset. It depreciates like heck, interest from FD or savings account (where I live anyway, is peanuts). Yeah, some of you lucky souls out there have online banks available, I don’t.

There is not much motivation to hang on to cash. Looking at the way things are heading, there’s limited option to grow your money. Without getting into sophisticated investments like collectible, it leaves me with properly selected real estate, value stocks and some mutual funds.

I wrote this post to illustrate a point. The point here is that when something is repeated over and over again, it is accepted as real even though there is nothing to prove it is the truth.

Have you ever heard the story of the Slow Boiled Frog? I’m pretty sure you have but for the benefit of those who haven’t, it goes like this.

Most people (after they have been told countless time, including me)belief that when you put a frog in a cool pot of water and slowly heat it, the from will get accustomed to the slow temperature changes and not do anything to escape. It will remain comfortable until it suffers it gets too hot and dies. Conversely, if you drop a frog into a pot of boiling water, the poor frog would do anything to get out it if can.

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The comments in my last 2 post prompted me to write this article about deciding what you want. In my previous article, I wrote about a person who, in moments of indecision, would buy both things , if he can’t decide which he really wanted. Obviously, Joe Flashy is not his real name although he exist.

Pondering it over a few days, I felt I should write this article. I felt, deciding what you really want, is an important skill everyone should develop. If not, I think we don’t enjoy and value what we own.

Let me illustrate my point. If you are reading this article and it is the first article you read on this site, you probably don’t know that I’m pretty darn frugal and something bordering in stingy, according to some. So when I buy stuff, I really make sure I enjoy it and get the most mileage out of it. I rarely buy stuff I don’t really want, and seldom make mistakes on my purchases. You see, I research the heck out of things I want to buy especially bigger ticket items.

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