Cashflow Quadrant, Robert Kyosaki
“Rich Dad’s guide to financial freedom” (Sometimes called Rich Dad, Poor Dad, Part II)
What is the book about?
Cashflow Quadrant aims to help you achieve financial freedom by explaining four different methods of income generation. It reveals why some people work less, earn more, and eventually pay less in taxes.
Who is this book written for?
If you enjoyed Rich Dad, Poor Dad, (by the same author,) this should be on your reading list. If you have already made the decision to invest in your financial future, but want to know more about the different options available to you, read this book!
Robert Kyosaki, a successful business owner, self-made millionaire and best-selling author of Rich Dad, Poor Dad, imparts the valuable knowledge his rich dad taught him about the four different types of people, which make up the world of business. He described them as the “Cashflow Quadrant.”
E= Employee, S = Self-Employed, B = Business Owner and I = Investor
Throughout Cashflow Quadrant, Kyosaki describes the many advantages and disadvantages of these fours types of income generation but demonstrates how the methods on the right side of the quadrant (Business owner and Investor) offer the best opportunities for financial freedom.
” As an employee, your earnings are taxed even before you get your paycheck. If an employee is paid $30,000 a year, by the time the government gets through with it, it’s down to $15,000….As a business owner, you can expense much of the earnings before the government gets it. If you own your own corporation, you make the rules…as long it conforms to the tax code.”
Through easy-to-understand instructions and straightforward diagrams Cashflow Quadrant teaches the seven steps needed to move from the left to the right side of the quadrant. The book explains that although financial freedom can be found on all four of the quadrants, the skills of a “B” or “I” will help you reach your goals more quickly
“The main reason why 90% of the population is working on the left side is simply because that is the side they learn about in school. They then leave school and are soon deeply in debt…”
After reading Rich Dad, Poor Dad, I immediately warmed to Robert Kyosaki’s writing style. I wanted to learn more about investing, so I sought out more of his books.
Cashflow Quadrant helps you to understand the different parts people play in the world of business.
Through this book, you can start to create your own path to financial freedom whilst identifying what changes you may need to make along the way.
You may notice a couple of references to Robert Kyosaki’s game “Cashflow 101 & 102”. I bought the electronic version of this game soon after reading Rich Dad, Poor Dad and I’m so pleased I did. It teaches you how to think and act like a rich person.
In my last game I owned 25 properties, 40 acres of land, a Pizza Franchise and made $1,000,000 on the stock market!
If you are a fan of Monopoly, you will love this game!