I own my home outright...asset or liability?

[Kent McDaniel]

I have been reading “Rich Dad Poor Dad” for the first time and I have to say...mind blown. I always saw my dad as very financially responsible, coming from a very poor upbringing and making a comfortable life for our family. Now I realize two things, (1) I’m not wrong in that thinking, but (2) his conservative ways did not generate wealth, but just allowed him to join the Rat Race and ”make ends meet”. Now, eliminating debt was always a priority of his, and consequently a priority of mine, but I see that there is still much more to the idea of true financial independence, so my wheels are turning non-stop as I try to further develop my understanding of what it means to create wealth, and the many ways of gaining assets while using other peoples money (thank you Bigger Pockets Community!). So, I was thinking about my current situation. I have a good job, am completely debt free, I am living in and rehabbing a wonderful old house that looks down on the Columbia River in Washington State, I own another house about 1 hour away that will become my first official BRRR, and I have a couple other pieces of land that I plan on developing within the next year. At first I viewed my house as an asset, but after reading more in RDPD, I am starting to think that, even though I don’t have a mortgage, this house is still, technically, a liability because it is not putting money in my pocket. Two questions that I’d love some feedback on: (1) Do you agree with the idea that, despite not having a mortgage, my house is a liability? I’m not suggesting that a debt free home is not a justifiable liability, but just that it IS a liability. (2) Does it make sense to put the equity from this home to work for me and use the cash to buy more assets, even if it means taking out a mortgage and increasing the magnitude of the liability? I really appreciate any thoughts on this. I was told about Bigger Pockets a few weeks ago and since then have not been able to shut my mind off. I have flipped several houses over the past several years, but only on a spot basis (take your money and run). I’m changing that strategy now and am eager to learn from all of you. Thanks in advance!