The path to financial independence involves collecting assets and optimizing or eliminating liabilities. When we look for ways to enhance our returns we naturally need to hone in on our biggest assets as they have the highest ROI potential. But, what is our biggest asset?

It may be our skills, our investments, or our relationships. I’ll dive into each of these three to see which is our biggest asset.

First, what’s an “asset” for the purpose of this discussion? Simply put, an asset (noun) is something that can produce income for us. While I would love to call someone’s home their greatest asset, it is often their greatest liability instead as it does not produce income and only incurs a cost each month.

Our Investments

I’ll start with investments since these are more black and white. A $10,000 investment in Vanguard’s Total Stock Market Index is subject to the riots and whims of the market, whether those be good or bad in the short term, no one can say.

Despite this, in the long run we can expect a range of returns anywhere from 5% to 8%, reasonably. Even if the price drops, we can still determine the value based on current market conditions (this is trickier with the other assets mentioned below).

I do not consider real estate an investment…unless it was a form of house hacking or rental properties.

Based on how we structure our portfolio of investments, we can expect varying degrees of returns. Those seeking a safer return might shelter money in bonds or even cash, offering returns as low as 1 or 2 percentage points.

The risk here is environments of above average inflation that may erode, eliminate, and overtake the returns on these “safe” investment vehicles.

Riskier investors may opt for individual stocks or fancier instruments such as options, futures or dabble in forex. If you have some real money (think seven figures plus) you can elect to fund private raising of capital, often seen by private equity groups. Many opportunities await only institutional investors who have access to many more instruments and investment vehicles than ordinary investors such as you and myself.

My suggestion is avoid spending too much time being wrapped up in “investing” and focus on setting up a good foundation first.

From there you can continue to add to the foundation while not distracting yourself from core pursuits. If money and investing become more of an obsession later, then you can always shift your money out of the foundation at a later date.

For more on this topic of Our Biggest Asset, check out this 5 minute podcast episode:

Our Relationships

 My experience with relationships was inspired by an excellent book called, “Never Eat Alone” Written by a former executive at Deloitte (a big 4 accounting firm) and also the youngest executive at that time for a Fortune 500 company.

While the title might suggest his one strategy is to always eat with people, the book offers a lot of great life encompassing approaches to networking.

The biggest takeaway I had, and I’ll share here, is the analogy of our network being a garden. We should focus on supplying our garden with seeds and nutritions without expecting a finished tomato to pop out overnight.

As time goes on, many of the seeds we planted will begin to grow. Depending on our future needs, we might only have a favor to ask of one or two people, but we should have planted enough seeds where we have dozens of other people who we don’t need to ask for a favor (not yet anyhow).

By focusing on providing value to many people WITHOUT expecting anything in return, we can grow our network.

The book doesn’t recommend we simply go out and provide value to everyone, but I’m sure you’re already thinking of some relationships in your life that may or may not prove helpful in the years to come.

It is never too late to start what may become an extremely helpful and beneficial relationship.

If you’re looking for extra inspiration, ask people you know how they landed their current job. Often, the answer is they got their foot in the door because of their network.

Our Skills

Investing in our skills is sometimes easy and sometimes difficult. If we are within a specific field, say accounting, an investment time into a certification program offers a chance to gain new skills while being able to easily present credentials.

In my life, I spent well over a year to develop my skills as an accountant. Specifically, I became a CPA and that required hundreds of hours of study. If your field offers lettered credentials, then be sure to analyze the cost benefit relationship to pursuing the credentials.

In most fields, skills are not listed after one’s name, so we look for other opportunities to demonstrate our work. My fiancee for example enjoys making candles and is able to show others her work through her Pinterest page. Back in the day, she would have had to carry around inventory to pull off such a marketing stunt.

Some of the biggest skills we need to learn are soft skills: Communication, Negotiation, Management (self and of a team), Emotional Intelligence, Self-Confidence, and the list goes on and on.

Similarly, if you’re gaining skills in one field, try to dive deep into the fundamentals. If you’re studying internet marketing, look for the classic sources of information on marketing in general. The growing buzz these days seems to be Facebook ads, which is great if you spend time learning what works and what doesn’t. BUT, focus on the older classics in marketing and understand why people buy or click on items in general.

By applying this approach to any new skills, we guarantee we can apply it across any area of our lives.

What’s your biggest asset? How are you investing in your assets to amplify your ROI?


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