Mulling over Robert Kiyosaki's Cash Flow Quadrant Part 1
I was reading Robert Kiyosaki's book "Rich Dad - Cash Flow Quadrant" over the weekend. I bought the book a year ago and finally got the chance to read it. Although after reading it, my (financial) life was still the same. After reading it again, it got me to seriously think about my own financial situation.
The book mentioned about a cash flow quadrant that points out a person's sources of income. Readers are made to ask where they get their source of income. The quadrant illustrates four sides namely: Employee, Self-Employed, Business owner and Investors quadrant. The employee and self-employed quadrant is on the left side while the business owner and investor is on the right side.
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My income comes from the employee quadrant, which has been my source for most of my adult life. Robert said that "E" quadrant will not give you financial freedom. It will only give you financial misery until you grow old. He is encouraging everyone to get out of the left quadrant and move to the right side of the quadrant. I guess it's not that easy because I've been used to the security that the "E" quadrant provides.
Come to think of it though, I realized that there's actually no security from the "E" quadrant. I've been in several jobs since I started working. I was in search of higher income. At the age of 30, when I finally thought that I had the coolest job where I could retire at the ripe age of 65, I was given early retirement at the productive age of 40 (can you believe that). Afterwards, I went back to job hunting.. Robert said in his book to get out of the rut before it is too late. He compared the "E" quadrant situation to a dog chasing its own tail.
There was also an advice in the book that caught my attention. He (Robert) said "build your assets and not your liabilities". How I wish that was easy. After sending my kids to college my assets have eroded over the years, and my liabilities has increased and remained at a level to this date. Right now, I need to reduce my liabilities using my "E" quadrant- income stream, which will delay asset building. I might not have a job next year which might further reduce my chances of building my asset.
Anyway, Robert Kiyosaki's book got my attention. I will be mulling on it for days (even years) to come. I'll try his advice - get out of the left quadrant and transfer to right quadrant, and see what happens. It's a leap of faith. His added advice was to take baby steps towards the right side of the quadrant. Good luck to me on this path! May the force be with me!
The book mentioned about a cash flow quadrant that points out a person's sources of income. Readers are made to ask where they get their source of income. The quadrant illustrates four sides namely: Employee, Self-Employed, Business owner and Investors quadrant. The employee and self-employed quadrant is on the left side while the business owner and investor is on the right side.
My income comes from the employee quadrant, which has been my source for most of my adult life. Robert said that "E" quadrant will not give you financial freedom. It will only give you financial misery until you grow old. He is encouraging everyone to get out of the left quadrant and move to the right side of the quadrant. I guess it's not that easy because I've been used to the security that the "E" quadrant provides.
Come to think of it though, I realized that there's actually no security from the "E" quadrant. I've been in several jobs since I started working. I was in search of higher income. At the age of 30, when I finally thought that I had the coolest job where I could retire at the ripe age of 65, I was given early retirement at the productive age of 40 (can you believe that). Afterwards, I went back to job hunting.. Robert said in his book to get out of the rut before it is too late. He compared the "E" quadrant situation to a dog chasing its own tail.
There was also an advice in the book that caught my attention. He (Robert) said "build your assets and not your liabilities". How I wish that was easy. After sending my kids to college my assets have eroded over the years, and my liabilities has increased and remained at a level to this date. Right now, I need to reduce my liabilities using my "E" quadrant- income stream, which will delay asset building. I might not have a job next year which might further reduce my chances of building my asset.
Anyway, Robert Kiyosaki's book got my attention. I will be mulling on it for days (even years) to come. I'll try his advice - get out of the left quadrant and transfer to right quadrant, and see what happens. It's a leap of faith. His added advice was to take baby steps towards the right side of the quadrant. Good luck to me on this path! May the force be with me!
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