The Long-Term View of Having Property or Fixed Assets

The opposing terms of asset and liabilities are fairly familiar with the most educated person in India being eager to provide for himself/herself and the family in the future. Unfortunately, it is not possible to have unlimited sums of disposable money handy. Choosing between fixed assets and property may become a trifle difficult as a result.

You may be the proud owner of tangible assets in the form of vehicles, a plant, machinery, or buildings. In short, you can touch each of the assets physically. Your fixed assets will also include the intangible ones such as your good reputation, the pants you may have as well as copyrights in your name and software. Most of these assets happen to be valuable with software as well as patents and copyrights being sold to another party in exchange for an amount of money. One’s goodwill cannot be sold, however. Make sure to go through your balance sheet while trying to list all your assets. The cost incurred for the construction of a building would be labelled as capital work that is in progress. The structure, once completed, will be transferred in your name or the name of your company thus becoming a tangible asset.

Sure, there are multiple advantages to owning tangible fixed assets. You can use it for a specific purpose for a long time and earn a good income from it over a while. You would be elated to see your asset increase the prestige of your company with your reputation growing consistently over a particular period. Moreover, you may enjoy tax deductions thus increasing your profits in a financial year.

Unfortunately, it is not all gains. There are quite a few minus points associated with fixed assets as well. For one, you may have to face a steady depreciation of value when the asset undergoes wear and tear as machinery and plants are likely to do. Sadly, you may be pleased with the thought of owning an asset but it will not give you immediate returns as you may be unable to offload it quickly in exchange for cash value.

It does not come as a surprise to find that Indians are more obsessed about buying real estate instead of opting for tangible fixed assets no matter how lucrative they happen to be. Some of the reasons for favoring property over other assets include: -

• You will be able to generate income by investing in real estate without living in it.
• You will be overjoyed to find it appreciate over time particularly when you take good care to maintain it properly. You will thus be able to get a handsome return when you think of selling it a few years down the line.
• You would even be able to use it to build wealth and create a generous portfolio with the money earned from a second or vacation house
• You would be able to get tax benefits while repaying the mortgage loan

Both real estate and fixed assets come with rewards and risks. It is advisable to trust your requirement and make the investment if you feel confident about it.

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The Pride Group is one of the best builders in Bangalore, known for their superior construction capabilities.