The Book revolves around Kiyosaki’s cashflow quadrant, which categorizes people into four quadrants. Employee, Self-Employed, Business owner, and Investor.
This books highlights some of the lessons Mr.. Kiyosaki learned from his rich dad.
1. It’s not how much you make but what you keep
2. The poor and middle class work for money, whereas the rich have money work for them.
3. It’s not the smart that get ahead but the Bold
4. Corporations are the biggest secret of the rich
5. The rich focus on their assets column while everyone else focus on their liabilities
The cash flow quadrant made me realize that I needed to move from the lefts ide of the quadrant to the right side as the left side is set up for the poor and middle class.
The left side is Employees and Self-Employed
The right side is Business owner and Investor
if you are on the left side you must perform or you don’t get paid. -This is called the poor side.
On the Right side you start to generate Passive income. The book underscores the significance of creating passive income streams that do not rely solely on your time and effort. Passive income, such as income from investments or scalable businesses, is a key component of achieving financial freedom.
Because I will not have a lot of working years left this book pushes me in the right direction to accomplish my goals.
With passive income, I can leverage people and money to increase my wealth, even while I’m busy doing other things.
Employee–If People in this quadrant want more money and don’t want to move to the right side of the quadrant, they must work more hours, continuing to trade even more time for money. These individuals pay more in taxes as well.
Self-Employed– Also pay more in taxes. Its just one step above employee because it trades time for money, working long hours, you theoretically own your own business, in reality the business owns you.
Business Owner– Take off work when they choose as they have systems in place and employees to help them run the business. They do not trade time for money, their business generates income whether they’re present or not.
Investor–By investing in income generating assets like stocks, real estate , or bonds it is where true financial freedom is found. They pay the least amount of taxes. Investors assets make money for them. He has earned money from one or more of the quadrants and has put the money to work for him.
What I have learned is no matter what Quadrant I am in I need to always contribute to the Investor quadrant.
I need to hurry into earning passive income before I am to old and unable to work.
