In the 50’s, usually a woman had very limited access to financial development – often that her only choice was to marry an extremely successful man. Her attractiveness was essentially her money in the marriage industry. Today, it is completely different. The red pill failed to receive the memo; it looks just like every other pill on the market.
The reality today is that anyone who has a substantial income can have access to additional asset classes. In addition, people with substantial stocks and bonds also tend to be more financially stable than those with no investments. So, for the vast majority of people, assets are not a function of luck and necessity. They are developed through careful planning and prudent investing, just as they were in years past.
One type of asset class that has been growing in recent times is “leveraged funds”. These are simply individual securities or portfolios that are owned by a lender and used as collateral for loans. For instance, if a person has a savings account with a bank but does not have sufficient credit score to qualify for a good interest rate, the bank may issue a loan for the balance. The bank uses the asset value of the fund as a replacement for the cash balance. If the borrower pays back the loan early, the asset is then less liquid and less likely to suffer loss by holders of the stock or bond.
Assets are obviously important to individuals and families looking to secure their financial future. How does one identify the best assets? The answer is probably not what you think. Your largest asset, by far, is your home. But, you are probably aware that the home will depreciate in value over time. Depreciation slows down as the years go by and home values usually do not begin to increase again until the late sixties or seventies.
So, let us look at another asset which is becoming much more closely tied to personal finance issues; highly educated items. A highly educated person is likely to have a wide variety of highly educated items in his or her possession. This means that this person is likely to have many highly educated possessions. Some of these might include, computers, high-end automobiles, sophisticated machinery, and highly technical educational learning equipment. All of these assets are highly liquid and thus have the potential to appreciate significantly in value.
In addition, highly educated items can be owned by one person. However, the real value of these assets grows substantially with the inflation of the system. Therefore, these assets are the best options for asset-based loans. Most real estate and asset-based lenders have a diversified offering of assets. Therefore, they do not experience the same losses as they might if they had access only to one type of asset.
It is important for you to realize that asset-based lending may not be appropriate for some situations. For example, if you own valuable jewelry or other items that you plan to wear for a long period of time, then you should probably consider selling them rather than using an asset-based loan to pay for them. Also, if you are married and are considering starting a family, and are not sure whether you can afford a down payment for your first house, then you should probably rent rather than obtain an asset-based loan. However, if you can make good payments on your assets, you should keep them, even after you have a family.
In conclusion, you must be very careful about what kind of assets you choose to use in asset-based loan applications. If you are planning on keeping your assets for a long time, then you should probably consider selling them rather than using an asset-based loan. On the other hand, if you anticipate needing to borrow money for many years, then you should probably obtain an asset-based loan. Although both types of loans involve borrowing from lenders, there are differences between the rates and terms of these two loans.
Editor-in-Chief since 2011.