Cashflow quadrant summary11/6/2022 ![]() ![]() If this has piqued your interest, read on. The author breaks down the concept of cash flow and shares his enormous wisdom on money. The ‘Cashflow Quadrant’ is a simple yet powerful book written by American businessman and author Robert Kiyosaki. However, it is clear that to achieve this form of freedom in life, cash flow plays a huge part in it all. Financial freedom is the way to freedom in life.įinancial Freedom has been a prominent highlight since the COVID-19 pandemic. You can check it out using the following links at Amazon, listen to it on Audible or alternatively on Booktopia – Australia’s local Bookstore.In reality, humanity is craving for freedom. The goal is to become an investor, and reap the benefit of the passive income it produces. Investors receive an income purely by virtue of their investments their money is put to work and makes more money! Investors are needed to stimulate growth in the economy and provide businesses with access to capital when they need it in return they are often paid a dividend or rewarded with share growth over time. Investors form the final quadrant, and consists of those who are typically investing in profitable assets such as business (private or publicly listed shares) and property. Business owners often work very long hours initially to create a successful business, and then only start to reap the lifestyle rewards and benefits by outsourcing and hiring their employees – even then, it is far from passive. Business owners will usually earn more, have more control over the direction of the company and implementing changing practices, and can find creative ways to avoid taxes such as through government incentives and asset write offs. Someone who has taken the skills that they ‘worked to learn’ and used them to create a business will most certainly always experience significant advantages over workers from the first two quadrants. The business owner is most always someone who has progressed from being Self-employed to employing others by definition a business will have employees. Small buisness owners are placed in this category when they dont employ anyone else. Those who are Self Employed are still subject to high income taxes, but have more scope for tax breaks as they can offset their working costs against their income. Being Self Employed can be brutal in a recession as it can be very difficult to secure contracts, and you are still subject to the whim of your employers. They still sell their time for money, however they may move freely between projects and contracts as they please. The Self Employed can be thought of as the freelancers or consultants of the working industry. The self employed is a variant on the employee someone who is working for themselves. They also are subject to high levels of income tax and don’t really get tax breaks. Employees are at significant risk should their employer terminate their job, or if the company went under. This isn’t necessarily a bad thing, as long as you realise why you are doing it – many entrepreneurs spend time as employees as they ‘work to learn, not to earn’ and then transition those skills into another quadrant. Most everyone will always begin their working lives as an employee that is to say, someone who actively sells (trades) their time for money, whilst working for a business or other entity. ![]() Cashflow Quadrant focuses on educating the reader on the four types of earners, and encourages you to analyse where you fit into the quadrant Quadrant One: Employee Your Money Or Your Life | Vicki Robin – Book SummaryĬashflow quadrant is a great financial education book and the follow up to Kiyosakis best seller Rich Dad Poor Dad. ![]()
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