an asset can a good thing.
according to dictionary
- Something or someone that is an asset is considered useful or helps a person or organization to be successful.
- The assets of a company or a person are all the things that they own.
as you can see from the second defintion it is anything that we own, however, somethings we own are good, and some are bad. if it's making you money, it's good asset, if it's costing you money it's "bad asset" aka liability.
and you already know what cash is right?
so if you own properties, business, those are assets, cash poor means you don't have a lot of cash. simple. i saw an old interview of donald trump, they asked him how much cash he has on him, he said none or very little. he rarely has cash or deals with cash.
so someone who has maybe properties, business that is worth $2million but $20k in the bank is asset rich, cash poor. (i know $20k is a lot of cash to some, but relatively speaking...)
sometimes, this works for some people. sometimes people are heavily invested, and just have enough cash to get by. now some assets are easier to liquidate than some. for example, it's easier and faster to sell your stocks (another asset) than your house, and you get market value for it too without fire sale.
what you gotta avoid is liability rich and cash poor. which some people wrongly call asset rich, cash poor. such as owning an expensive mortgage and car loan and no cash. however the slow lanes, like to see it as owning a big house and nice car. we saw this the last few years, people who owned $1million homes, $50k cars and little to no savings. Now that's liability rich, cash poor.
personally, i never ever count any car as an investment. and i never count a primary residence as an asset, even if the mortgage is paid off. sell it first, then count it! until then, if you are going to live in it for the rest of your life, you will never realize the worth of it, the only thing you can do is maybe leverage it to get loans. so i always count primary residence as liability, well in some rare exceptions you might be able to rent out a portion of it, and it will actually cover all your mortgage, then you can count it as an asset.
hope this helped.