Turning Liabilities Into Assets

Before we start talking about turning liabilities into assets, let’s see the differences.

An asset is something you own that can potentially produce a passive income for you, meaning you can own that asset and go to sleep, close your eyes, and still make money from it. A prime example is real estate, where you purchase rentals that can generate money passively. In contrast, a liability is something you have to work to maintain, like a car or a mortgage. The house you live in that requires keeping up with a mortgage is a liability; if you don't work, you won't afford to live there.

But what if I tell you that you can turn that liability into an asset? For example, if you buy a house and have a duplex where you can live on one side. Then you can rent out the other side, which can become an asset because, yes, you are still paying for the mortgage, but then you have a tenant on the other side of the house who’s helping you pay for it.

Getting a little bit more creative about that, what about, say, a car? Can a car, which is in essence for most people a liability, because the minute you stop working and the minute you stop paying for the monthly payments, you won’t afford that car anymore. But if you turn that into an asset by renting it out to an Uber driver, to a Lyft driver, and you receive money for letting other people use your car. Or maybe an example like Turo. For those who don’t know, Turo is like Airbnb for cars. It’s a peer-to-peer rental, where folks, people like you and me can just put their vehicle, and they rent it to other people to use. The fees are a lot more affordable as if you were to rent out a car, right at the airport.

Those are some of the examples that you can use. If you have a car, let’s say, sitting in your garage that you’re not using right now. You have to keep paying or covering for the monthly payments, or maybe it’s fully paid, and it’s just not doing anything, just sitting in there. Turn that into an asset, rent that out and make some passive income out of it. I wanted to do this because I wanted you guys to start thinking creatively and not believe that the only way to create passive income is by using real estate. You can leverage anything that you have, and you can turn that into an asset.

You turn your car into an asset by renting it out to an Uber driver, to a Lyft driver. You receive money for letting other people use your car.

Another example that you can leverage is like, for women, we love handbags, right, anything from Michael Kors, Louis Vuitton bags, but we can only wear one bag at a time. What do you do with the remaining dozen that are sitting up there in the closet? You can use platforms like brand Borrow or Steal or something like that. You can rent your handbag to other people to wear during the week or a day or two. You can get good money out of it. You can get back all the money that you invested in buying that bag.

I was thinking, “Well, is there another way for us to create additional passive income?” It’s all about thinking creatively. You can turn anything into an asset if you know what to give it to.