Cash Flow Quadrant, Robert Kyosaki
“Rich Dad’s Guide to Financial Freedom” (sometimes called Rich Dad, Poor Dad, Part II)
What is the book about?
The Cashflow Quadrant aims to help you achieve financial freedom by explaining four different methods of generating income. It reveals why some people work less, earn more, and ultimately pay less in tax.
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’ve already made the decision to invest in your financial future, but want to learn more about the different options available to you, read this book!
Robert Kyosaki, 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 who make up the business world. . He described them as the “Cash Flow Quadrant.”
E= Employee, S = Self-Employed, B = Entrepreneur and I = Investor
Throughout the Cash Flow Quadrant, Kyosaki outlines the many advantages and disadvantages of these four 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 cash flow. Financial Freedom.
“As an employee, your earnings are taxed before you even get your paycheck. If an employee is paid $30,000 a year, by the time the government is done with him, it will be down to $15,000…. As an owner of “A business, you can spend a lot of the profits before the government gets them. If you own your own corporation, you make the rules…as long as it follows the tax code.”
Through easy-to-understand instructions and simple diagrams, the Cashflow Quadrant teaches the seven steps required to move from the left to the right side of the quadrant. The book explains that although financial freedom can be found in all four quadrants, the skills of a “B” or “I” will help you reach your goals more quickly.
“The main reason why 90% of the population works on the left side is simply because that’s the side they learn about in school. Then they drop out of school and soon find themselves in deep debt…”
I say:
After reading Rich Dad Poor Dad, I was immediately taken with Robert Kyosaki’s writing style. I wanted to learn more about investing, so I looked up more of his books.
The Cashflow Quadrant helps you understand the different roles people play in the business world.
Through this book, you can begin to create your own path to financial freedom while 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 shortly after reading Rich Dad Poor Dad and I’m very glad I did. It teaches you 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 in the stock market!
If you are a Monopoly fan, you will love this game!