An asset is a resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide future benefit. Assets have four characteristics:
Maturity: Short-term or Long-term
Short-term assets are available for use within one year. One example of a short-term asset is a cash holding. A long-term asset is a stock, bond or other asset that an investor plans to hold for a long period of time. An example of a long-term asset is a retirement account.
Use: Personal, Investment, or Business
A personal use asset is a type of property that an individual does not use for business purposes or hold as an investment. An investment property is a real estate property that has been purchased with the intention of earning a return on the investment. A business asset is a piece of property or equipment purchased exclusively or primarily for business use.
Tax Treatment: Qualified or Nonqualified
A qualified asset refers to the special tax treatment given to investments held in employer-sponsored or individual retirement plans. Non-qualified holding is an investment that does not qualify for any level of tax-deferred or tax-exempt status. They are taxed on an ongoing basis as they earn income.
Security Type: Fixed Income or Equity
Fixed income assets or bonds are types of investing or budgeting styles. Real return rates or periodic incomes are received at regular intervals and at reasonably predictable levels. Equity is a stock or any other security representing ownership.