Ask any person what is their biggest asset? Well it sets them thinking….and then the facts…

Most people do not know what is their biggest asset. They then say – it is ‘ my house’ , ‘my equity portfolio’, my car, etc.

However then I lead them to the next question:

Have you borrowed for your house?

They jump and say yes. My house cost me 93 lakhs – i put Rs. 12L of my own and borrowed Rs. 81 lakhs…or so goes the discussion.

Is this a home loan? They say yes. I ask them what is the security that you gave…they think it is the house. It is not.

You do not get a house loan, a car loan or a personal loan. What you get is a loan against your FORM 16 – it is an assumed capability to create income in the future ALSO.

So your biggest asset is ‘your ability to create the net cash flows which can repay the loans’ – that is your earning power.

What can affect your earning ability / power to bring in the cash flows?

Early death, Critical Illness, Disability – and these are the risks that you run. Thankfully these are all insurable risks.

One more very big factor affects your earning ability if you are in service – RETIREMENT. Learn about saving / investing for your retirement.

Read India’s latest book on Retirement planning – or a Retirement Guide by an Indian author “Retire Rich Invest Rs. 40 a day” – see the page on ‘about the book I have written’ button…you will find greater details.