Cashflow Quadrant

Last week I talked about the Cashflow 101 game by Robert Kiyosaki and today I'm going to talk about one of his books "Cashflow Quadrant". Robert and his team have written many books on finance and investing, but this is one of my favorites.

What is the Cashflow Quadrant? Well, it looks something like this:

What it's saying is that there are four ways to produce an income: you can be an employee, self-employed, a business owner or an investor.  According to this graphic, 95% of the population is on the left side of the quadrant, that is they have a job or own a job (self-employed), but either way they're trading their time for money. And only 5% of the wealth is on the left side. The 5% of the population on the right side controls 95% of the wealth.

Remember "Occupy Wall Street"? They were complaining about the 1% who controlled the money. But what did they really accomplish? Nothing. The 1% still controls the money. How about instead of protesting and calling these people names that we join the 1% (or 5% in this case)? If we learn how to create businesses and to invest our money wisely we can be part of the 5%. In fact, if enough people do this, we can double the size to 10%.

There are many ways to start a business: you can be a professional like a doctor, lawyer, plumber but usually when you start out you'll be by yourself so you'll be in the lower left quadrant. Or maybe you can purchase a franchise such as McDonald's. I don't know how much a McDonald's franchise costs…probably hundreds of thousands of dollars. But what you're really buying is the system. Or you could join a network marketing company. Again, you're buying a system but now you're spending maybe a few hundred dollars.

Education is the best way to move to the right side of the quadrant. Learn about the different ways to start a business and pick one that works for you. And then you can look at the many different ways that you can get money to work for you.

Interesting days

Today - https://www.daysoftheyear.com/days/world-backup-day/ Backup all of that valuable data! Your spreadsheets, your databases, your music and all of those beautiful pictures! Ask me how you can get unlimited photo storage for only $39/month. It's https://www.daysoftheyear.com/days/eiffel-tower-day/ I've been to England and Germany. And I had a 4 hour layover in Italy but I've never been to France. I love their bread! And don't get your crayons too close to the flame! 

Tomorrow - https://www.daysoftheyear.com/days/sourdough-bread-day/ I'll have to try again to make it to the bakery in Berkeley that I missed on French Bread Day earlier in the month. And you know you want to celebrate https://www.daysoftheyear.com/days/fun-day/ Go ahead…it's ok. And https://www.daysoftheyear.com/days/one-cent-day/ celebrates the lowly copper coin.

Next Tuesday - How about https://www.daysoftheyear.com/days/no-housework-day/ as a day worth celebrating? And it's https://www.daysoftheyear.com/days/beaver-day/ How about a "Leave it to Beaver" marathon? (6 seasons are available on Netflix and I've already added them to my queue!)

April 31 - Fooled you…there is no April 31st, so you get a day to rest.