Of any of these myths, Robert Kiyosaki has gotten the most flack from this idea. In 1997’s “Rich Dad Poor Dad” he wrote this concept but it didn’t make itself obvious until 2008.Many financial advisers recommend buying a house because it will appreciate meaning you will make money and you can write off the interest. So you’re telling me to pay a dollar to at best get back 40 cents. That’s still losing 60% of what I paid. How is that good advice? Buying more houses for more deductions is just bad planning. When it comes to your house, after paying the mortgage, taxes, insurance, upkeep, utilities, repairs, updates, etc. do you make money each month? Remember that an asset is anything that pays you monthly cash flow that you don’t have to work for so if you pay monthly for your house – it’s a liability. Who’s asset is it then? The banks. The bank gets a nice payment every month and they don’t have to spend any money or time to get it. The other big thing is know the difference between capital gains and cash flow. Capital gains is when something you own goes up in value. Cash flow is the money left over when you deduct all the expenses from all the income for an asset. So, if your house goes from $100,000 to $120,000, you’ve had a capital gains of $20,000. If you rent a house out for $1000 dollars a month and all your expenses are $850, your cash flow is $150 dollars. The problem with capital gains (other than taxes) is real estate goes in cycles. So in 2008 when property values dropped, many people lost their homes or owed more on their homes then they were worth. That same $100,000 house that went up to $120,000 in five years then dropped to $60,000. And the worst part is your banker told you to pull out a home equity line of credit or refinance your house so you borrowed $96,000 against your house to buy a boat or new car!! OUCH!! With a capital P for punch me in the wallet. Now you owe more than your house is worth. Now that same cash flowing house, 2008 happens – the house is in a 30 year mortgage so your expenses stay the same and rent moves slower than housing prices so unlike house number one that is now $36,000 upside down, this rental is still producing $150 a month cash flow. Notice the difference? So, please do buy a house if you want, home ownership is not a bad thing. Just keep in mind your house is not an asset.