Book Review: Cashflow Quadrant by R. Kiyosaki
I'm cruising through the books I have already read in the past, reminding myself of what's in them and hopefully giving you all some insights.
Cashflow Quadrant by Robert Kiyosaki is a "sequel" to Rich Dad Poor Dad. It continues on with Robert's education from his rich dad, explaining the difference between 4 quadrants that people may find themselves in:
ESBI E=Employee which is where the majority of people in the US are in - this is also the quadrant that Robert's poor dad stayed in his whole life. This group goes to work to earn money, gets taxed the most by the government, then usually complains about people in the other quadrants. S=Self Employed including many professionals like doctors, dentists, etc. These guys/gals don't work for anyone but themselves - and usually pay for it in lost time and sometimes lost money. They get taxed about the same as an E, depending on how their business is set up. The main thing is they work for themselves and by themselves usually, with a very small team. They spend lots and lots of hours working at their business. B=Business Owner. This person is very different than an S - they own a business that makes them money *without* them having to be there! Think for example of a franchise business, let's pick McDonalds. You buy into it, then hire management team who hires workers and run everything as the franchise tells you to do it. You can then go do something else while the business runs itself. Your money is working for you instead of you working for money. Time Value of Money. Time is your most precious asset. I=Investor. Besides being a business owner, this person invests. I don't have my book in front of me right now (lent it to a friend), but this person makes their money work even harder than a B. The next book Rich Dad's Guide to Investing delves deeper into the levels/types of investors.
The main goal for all of us E's & S's is to spend more of our time in the B & I quadrants (E/S are on "left" side of quadrant, B/I are on the "right" side - multiple meanings to the word "right"). Example would be from the recent summit - I attended Michael Zuber's presentation on "How to Build an Investment Portfolio while Working a Full-Time Job". It was very insightful! If you missed it, hopefully soon we'll get his presentation here on BP somewhere and maybe even a video/audio recording that we can watch/listen to over and over. Michael continues to work at his full time job while his investments in real estate make him and his family lots of money.
Rich Weese's "From Janitor to Multi-Millionaire" book also goes into how we can transition to owning lots of real estate. Here's a small token of knowledge I've gained from Chapter 4: buy 1 house a year for 20 years. Easy entry that takes perseverance. More when I finish the book!
Next time: Review of Rich Dad's Guide to Investing!
Cashflow Quadrant by Robert Kiyosaki is a "sequel" to Rich Dad Poor Dad. It continues on with Robert's education from his rich dad, explaining the difference between 4 quadrants that people may find themselves in:
ESBI E=Employee which is where the majority of people in the US are in - this is also the quadrant that Robert's poor dad stayed in his whole life. This group goes to work to earn money, gets taxed the most by the government, then usually complains about people in the other quadrants. S=Self Employed including many professionals like doctors, dentists, etc. These guys/gals don't work for anyone but themselves - and usually pay for it in lost time and sometimes lost money. They get taxed about the same as an E, depending on how their business is set up. The main thing is they work for themselves and by themselves usually, with a very small team. They spend lots and lots of hours working at their business. B=Business Owner. This person is very different than an S - they own a business that makes them money *without* them having to be there! Think for example of a franchise business, let's pick McDonalds. You buy into it, then hire management team who hires workers and run everything as the franchise tells you to do it. You can then go do something else while the business runs itself. Your money is working for you instead of you working for money. Time Value of Money. Time is your most precious asset. I=Investor. Besides being a business owner, this person invests. I don't have my book in front of me right now (lent it to a friend), but this person makes their money work even harder than a B. The next book Rich Dad's Guide to Investing delves deeper into the levels/types of investors.
The main goal for all of us E's & S's is to spend more of our time in the B & I quadrants (E/S are on "left" side of quadrant, B/I are on the "right" side - multiple meanings to the word "right"). Example would be from the recent summit - I attended Michael Zuber's presentation on "How to Build an Investment Portfolio while Working a Full-Time Job". It was very insightful! If you missed it, hopefully soon we'll get his presentation here on BP somewhere and maybe even a video/audio recording that we can watch/listen to over and over. Michael continues to work at his full time job while his investments in real estate make him and his family lots of money.
Rich Weese's "From Janitor to Multi-Millionaire" book also goes into how we can transition to owning lots of real estate. Here's a small token of knowledge I've gained from Chapter 4: buy 1 house a year for 20 years. Easy entry that takes perseverance. More when I finish the book!
Next time: Review of Rich Dad's Guide to Investing!
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