Depreciating Assets Explained in One Minute

Depreciating assets are assets about which you can be pretty much certain they'll lose value: electronics, furniture, you name it.

While depreciating assets are obviously "better" to have than liabilities, your goal should definitely be aquiring investment grade assets (real estate, stocks, digital assets and so on) rather than depreciating ones.

Remember: you BUY depreciating assets, you don't INVEST in them.

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[LeserDrac]

From this video, I obtained the following info:

Assets:-
1) Undergoes Depreciation
-becomes less worth over time.
-also known as expense.
(yes it can be an investment too, when you buy the asset and capitalize it for some sort of production)

2) Undergoes Appreciation
-becomes more worth over time.
-it does not permanently increases, there will be a point of down turn.
-also known as investment.
(yes it is an expense too, because you initially bought the thing, the difference is that it doesn't have reduction
in its value after the purchase, rather, the price goes up until a certain eventual point.)

Thanks for the video.

[sonofagunM]

nice informative short video, keep it up

[ISMDOBLE]

Love this video, going to show it to my homebase! Also props for mentioning Bitcoin!!

[bernardthomas]

Not what I was looking for, but thanks.

[DJ-xkux]

Is depreciating assets and liabilities same ??

[sanisidrocr]

Great that you promoted Bitcoin as an appreciating asset due to it being a disinflationary currency unlike USD fiat which depreciated at 2-6% a year and worse currencies that depreciate between 170-720% a year (Venezuela). Bitcoin has gone up from around 1/10 of a penny in value in may 2010 to 607 USD today, for an average return of 666% per year or the dollar losing 99.9+ % in value against bitcoin in the last 6 years. Growth has slowed but still growing at an incredible 159% from one year ago which is excellent returns from a cost average basis.

[sanisidrocr]

Gold is a good store of value, but it can be argued is a poor investment as it cannot beat the returns of many safe index funds like the SP 500 or the DOW over the long haul where you can expect an average of 9.7% a year. Thus one of the primary benefits of gold beyond investment is tax avoidence and money laundering due to its more fungible nature but at the cost of illiquidity and liability of usage and storage.

[neoxenoz]

Anyone who honestly thinks buying a car or motorcycle is an investment that goes up is stupid as hell. Why are these called an asset in the first place when they lose value?

[claytonhalligan]

Isn't a depreciatiing asset a liability ?

[nikolaosventouzhs]

So..which category fiat currency fall in? :P

[OneMinuteEconomics]

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