Simple Concept of Investing

The fundamental principal of investing is simple. Investing is all about buying "assets" ( Robert Kiyosaki author of Rich dad Poor Dad: defines it as anything that puts money into your pocket )

To Value an Investment: let say your bank account has $1,000 cash, your bank account pays you 4% interest, so at the end of the end you get $40. We call that 4% yield or Return of Investment.

So in investing you are actually buying an asset at a reasonably predictable of Income or Earning of the asset.

These assets includes:

Stocks with dividend yield
Real Estate with cashflow
Business with net operating Incomes

Now through those investments we could have our money working for us. Therefore, we aren't working for money, leaving us enough time to enjoy our life and focus on growing our portfolio like Warren Buffett.