Turning A Liability Into An Asset

You've heard me ranting about how a car is not an asset, and that is still true.

However, you can still turn something like this from a liability into an asset. In December, I was flitting around on Ebay Motors and I found an auction on a 2004 Toyota Prius that was going to end in 30 minutes with no reserve.

I did a quick Carfax report on the car and it came back clean. I also confirmed that the title was clean (not salvage). I placed a bid and won the car for $15,400. My intention from the beginning was to resell this car for a profit.

I had to ship it from California and re-register the title into my name, that cost about $1,000. There was also about $250 - $300 in misc. costs (insurance, gas, advertising, etc.). So overall my total costs for the car was about $16,650.

I knew that I could sell this car for a proft and make some money. I put an ad in the local paper and placed some flyers around town and I eventually sold it for $18,200 just this past week! That's a profit of $1,550, or a 10% return in only 6 weeks.

So I made a nice little profit in a relatively short period of time. Remember, an asset is anything that has the potential to increase in value. Buy low, sell high, get wealthy!