Have you ever wished that you can make money and achieve wealth like rich people do? If the answer is yes, then it is very important that you have a clear understanding of which quadrant you are starting from and what it takes to move into the quadrant where the rich reside.Robert T. Kiyosaki’s The Cashflow Quadrant, is the sequel to his first book, [easyazon_link asin=”3442217784″ locale=”US” new_window=”default” nofollow=”default” tag=”earweaforyouf-20″ add_to_cart=”default” cloaking=”default” localization=”default” popups=”default”]Rich Dad, Poor Dad[/easyazon_link].
In Rich Dad, Robert discussed the differences in philosophies between his real father and best friend’s father regarding money and finance and how they both influenced him and made him what he is today. You can read my Rich Dad book review here.
The Cashflow Quadrant, explains the 4 categories (quadrants)that people fit into based on how they earn money as well as their thoughts about finance. Robert states that it is possible to move from one quadrant to another. However in order to do so, a person must be willing to make the necessary lifestyle changes.
[easyazon_image add_to_cart=”default” align=”left” asin=”1612680054″ cloaking=”default” height=”160″ localization=”default” locale=”US” nofollow=”default” new_window=”default” src=”https://ecx.images-amazon.com/images/I/41HFBjU5c4L._SL160_.jpg” tag=”earweaforyouf-20″ width=”107″]
What are the 4 Quadrants?
- Has a job
- Focused on job security and good benefits
- Owns a job (like to”be their own boss”)
- Value independence–don’t want or need supervision
- Professionals–doctors, lawyers, plumbers, hair stylists
- Owns a system
- Employs others to run the system (business)
- Doesn’t work for money; money works for them
- Use other people’s time (OPT) and other people’s money (OPM) to achieve wealth
- Playground for the rich
The poor and middle class are mainly on the left side of the quadrant (E’s and S’s) while the rich are on the right side of the quadrant (B’s and I’s).
Which side of the quadrant is best?
According to Robert, it basically comes down to a choice between having job security and financial freedom. If job security is most important to you, then you’re most likely choosing to be on the left side of the quadrant–as an E or an S. If having financial freedom is most important to you however, then the right side of the quadrant– B and I is where you should be. If you are currently unhappy being on the left side of the quadrant and wish to move over to the right side, there are some things you need to change.
How do you move from the left side to the right side of the quadrant?
1. Change your thinking and mindset.
- What you say to yourself internally affects your actions and becomes your reality.
2. Try to make decisions based on logic rather than emotion.
- For example, the making and losing of money is an emotional subject. In order to move forward towards the right side of the quadrant, Robert says that it is necessary to be emotionally neutral to winning and losing; it’s all part of the game.
3. Learn what you need to learn about money and finance and continue learning.
- As you learn more, your financial intelligence will increase.
4. Take action on what you’ve learned. Don’t be afraid to make mistakes.
- Robert says that making mistakes is oftentimes the best way of learning.
- Take small steps when taking action. Think of the analogy “a baby must learn to crawl before he/she learns how to stand up and then walk”.
5. Believe in yourself that you can move from one quadrant to the other.
- If you don’t believe in yourself, then why should anyone else?
Is reading The Cashflow Quadrant worth it?
I would say most definitely yes it is. If you are unhappy about where you are financially or how your life is currently going, you need to know exactly where you are and you have to decide where you want to go in the future. I think this book gives you a blueprint for
- helping you determine where you are financially
- identifying which paths are options for you to choose in shaping your financial future
- identifying what things you need to change in order to make your financial future goals a reality
Actions I have taken since reading The Cashflow Quadrant
After having read this book, I took action and did the following:
1. I took some real estate classes taught by Robert Kiyosaki’s Rich Dad Education series
2. As a result of taking one of those classes, I entered into a lease option deal with a real estate entrepreneur who was into renting, rehabbing, and selling homes. I was successful for a while, as the deal was providing me with positive cashflow every month. However, this deal fell apart later on because I made the mistake of not having the proper written contracts in place. The real estate entrepreneur suddenly without warning, closed up his company (or reorganized under another name) and just stopped paying me. At the time I did not the money to take legal action against him. This was a painful lesson in experience ( I lost money) but it was a good lesson in that I learned what not to do if the situation should arise the next time. I would not have learned this if I had not made the lease option deal in the first place.
3. Made the conscious decision to seriously pursue affiliate marketing. I decided to do this because affiliate marketing would give me the best way to learn the ropes and make money at the same time. If you are also interested in getting involved with affiliate marketing, you can take a look at my #1 recommendation.
I hope I have helped you decide to read The Cashflow Quadrant. Now that the new year 2015 is approaching , this would be the perfect time to assess your life and how you want your future to unfold. Feel free to share this post with others who may be interested.
As always, if you have questions or comments I will be happy to help.