₦airaland Forum

deenee:
Definition of fixed asset:-assets which are purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings, and equipment.

That said any fixed asset that is not generating income to match its depreciation through wear and tear or its been obsolete is a liability.

Please we shouldn't allow class room accounting to confuse us. Even land that is said to appreciate in theory can be a liability in retrospect esp if one cannot easily convert the land to cash in time of urgent need.

Also there is a huge difference between been asset rich and cash rich.

Even from a asset perspective only-there are still wide gaps. E.g

Mr A who is worth 100m and lives in a owner occupied house of 25m with the rest of his networth in cash generating investments is way richer than Mr B who is worth 150m but lives in a 120m owner occupied residence with the rest of his networth in the saame class of investments.

The only way Mr B will termed to be richer than Mr A is if he can convert the residence to cash or a cash generating asset. Overall cash is king!


Otherwise we can all just walk into a bank and simply exchange our title documents for cash irrespective of where the property or fixed asset is located.

I think people need to look at his investment options from an economic profit point of view-comparing all the options against the opportunity cost of other investments

Finally, as i said in my earlier post 11m is and is not small money, depending on how we look at it.
And rushing to build a house or buy land will not be a top of mind investment option for me if i was in the poster's predicament.

Exactly.
I was surprised to see someone say a fixed asset can not be a liability. It definitely can!

And rich can also be relative... What's the point having 1billion cash but living in a rented apartment.... Perspective also

Richy4:
So basically u opened two accounts today.. this particular account for insult and the other account to ask questions right?
Well my apologies.. have a good day

You caught him red handed

pocohantas:
A LAND IS AN ASSET. I am not very interested in the economic perspective of his investment. That wasn’t the premise on which my comments were founded, neither did I contest it.

Ok good for you. Please go and buy land both at the North and South poles and recognise as assets in your statement of networth.

The economic perspective which you very much don't want to talk about is the reason we are all here, arguing back and forth.

Let me recap again for you-poster has 11m and he is torn between building a house, renting or business expansion. So, basically insatiable wants and needs against limited resources which is Economics101.

It's funny how Nigerians equate land and house ownership with riches and wealth. For an average Nigerian, the moment they have 1m cash....boom they go and buy land and spend the next 6 or 7 years scrapping to complete the house losing alot of economic opportunities in the process.

Jeff Bezos just bought his first house like 3 years ago despite having been worth over 100billon dollars. Warren Buffet has only one house and he was already worth over 10 billion dollars before he bought it.

Property acquisition if it is not for commercial reasons is not worth it. That said one can invest in a nice house for residential purpose but only when you have built a reasonable portfolio of income generating assets.

Thank you and please stay safe.

chukzyfcbb:
These people you mentioned took on risks so they can enjoy later, they could as well play safe by investing all in building houses but didn't.

But they took on risks and now they are living off their wealth. Eg Tony Elumelu with his foundation helping other young ones. that's the point I am making.

Now is the time to buy landed properties, some people are cash strapped and will do anything to raise money by laying off thier assets. I don't support building of house tho it's a tie down of limited cash . But like I said he should use a bit to buy land and watch it grow , while he invests the rest in his hustle.

Don't just disagree with me, drop your points why you think otherwise.

Yes they took risk by not buying land but investing in business which is what we are telling the poster to do.

Thank you

deenee:
Ok good for you. Please go and buy land both at the North and South poles and recognise as assets in your statement of networth.

The economic perspective which you very much don't want to talk about is the reason we are all here, arguing back and forth.

Let me recap again for you-poster has 11m and he is torn between building a house, renting or business expansion. So, basically insatiable wants and needs against limited resources which is Economics101.

It's funny how Nigerians equate land and house ownership with riches and wealth. For an average Nigerian, the moment they have 1m cash....boom they go and buy land and spend the next 6 or 7 years scrapping to complete the house losing alot of economic opportunities in the process.

Jeff Bezos just bought his first house like 3 years ago despite having been worth over 100billon dollars. Warren Buffet has only one house and he was already worth over 10 billion dollars before he bought it.

Property acquisition if it is not for commercial reasons is not worth it. That said one can invest in a nice house for residential purpose but only when you have built a reasonable portfolio of income generating assets.

Thank you and please stay safe.

Okay...

deenee:
Definition of fixed asset:-assets which are purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings, and equipment.

That said any fixed asset that is not generating income to match its depreciation through wear and tear or its been obsolete is a liability.

Please we shouldn't allow class room accounting to confuse us. Even land that is said to appreciate in theory can be a liability in retrospect esp if one cannot easily convert the land to cash in time of urgent need.

Also there is a huge difference between been asset rich and cash rich.

Even from a asset perspective only-there are still wide gaps. E.g

Mr A who is worth 100m and lives in a owner occupied house of 25m with the rest of his networth in cash generating investments is way richer than Mr B who is worth 150m but lives in a 120m owner occupied residence with the rest of his networth in the saame class of investments.

The only way Mr B will termed to be richer than Mr A is if he can convert the residence to cash or a cash generating asset. Overall cash is king!


Otherwise we can all just walk into a bank and simply exchange our title documents for cash irrespective of where the property or fixed asset is located.

I think people need to look at his investment options from an economic profit point of view-comparing all the options against the opportunity cost of other investments

Finally, as i said in my earlier post 11m is and is not small money, depending on how we look at it.
And rushing to build a house or buy land will not be a top of mind investment option for me if i was in the poster's predicament.

Adonaina

Sir, what's your view on this topic generally.
You are specially invited.

Thanks

covid2019:
Adonaina

Sir, what's your view on this topic generally.
You are specially invited.

Thanks

Please refer to my first comment. Thank you

Up for sell
Hp elite book820
4gigram 320hdd
Good battery
Follow come charger
Intel

PrinzCarter:
Up for sell
Hp elite book820
4gigram 320hdd
Good battery
Follow come charger
Intel

Price please? What operating system?

covid2019:
I am in a dilemma worsened by this covid19.

I am a graduate male of 29 residing in the East. I still squat with a friend, not because I don't have money for house rent. But principally because I have been unable to figure out what I want to do with my life, hence renting a house feels like a commitment that might get me stuck.

I always feel I might move anytime soon-- to either another state or abroad for masters or just practice of my profession. Note that I didn't study a STEM course.

All these while squatting, I have been saving via my proceeds from hustles.

In the wake of this COVID19, I checked all my banks and found out that money I have in my account has lost so much value given the dollar rate.

I have 11.4 million, inclusive of my working capital, plus a rickety car valued at 350k. Each time, I need just 3-5m as working capital.

It seems that trying to save more is false economy and might be counter productive.

NOW, I AM CONSIDERING buying a plot of land and erecting a small house even if it's 3 rooms. This, I think will serve as investment that will keep appreciating and also serve as residence.

Or just open a domiciliary account to hedge against naira fall and continue saving.
What do you think please?

I am in the same delima but I have a wife and a 3month kid... What to do i do.. Should I just build for thier comfort... Maybe one rental attached and chill... Pls advice

ConnectMee:
I hope you get to read this.

29, single, a graduate, prudent, smart, with over 11m in savings.

Bruv, I envy you and would do this if I were you.

Start the Australian or Canadian PR program now that age is still on your side. Thankfully, money won't be an issue as you have the financial power to process it. Give or take, you will need 4 to 4.5m for the entire process including PoF.

And you don't have to pay anyone to do it for you, there's enough DIY resources here on Nairaland to start with.

By the time you get there, it becomes easier for you to do your Masters at a far cheaper cost and in a good school because of your PR status. And of cos, more investment and career opportunities are laid bare to you simply because you'd be more exposed, live and work legally in a country that works.

From the remaining money, retain your business capital. You can also get a plot of land in a good location. Perfect the C of O and continue with your hustling. When you start making more over there, you can come back to build your house.

I wish someone pointed me to this when I was your age. Now, I am in my late 30s, self-employed, newly married, a landlord in Lagos but guess what, I have started with the PR route.

Nothing is certain here in Nigeria. The value of your 11m now is not the same about this time last year and I doubt if it would get better by December.

So make a move now. I wish you the very best.

Can I jion u on this route?

yanabasee1:
Well..... I wish to have friends that will allow me to squat with them and be making this kind of savings to be contemplating about building a house....



God give me these type of friends mbok!!

it's actually very simple, all you need to do is to be a responsible roommate that contributes financially as well physical effort to the upkeep of the home.