Mulling over the Robert Kiyosaki's Cash Flow Quadrant Part 2

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In order to successfully migrate to the right side of the quadrant, Robert advised in his book "Rich Dad's Cash Flow Quadrant", take baby steps.  He also advised readers to build assets not liabilities". In my current situation, I have more liabilities than assets.  This was the result of sending my three children to college.  Fortunately, they've all finished college.  Having kids that finished college might be considered assets being parents, but not from a financial perspective.

Going back to my liabilities, I have several.  I have a credit card debt from consumer purchases. Secondly, I have debts owed to relatives, when I took out personal loans from them to pay for college tuitions.  Lastly, I took out salary loans from the Social Security System and Pag-Ibig.  These loans are already in default and incurring penalties and surcharges.

Again, take baby steps towards the right side of the quadrant.  But first things first, I need to retire my debts in order to improve my financial position.  First, I am going to retire my credit card debt is which around 22,000 pesos.  Presently, I am just paying the minimum amount of 1,200 pesos monthly.  As I examined my credit card billing I realized that when I only pay the minimum amount, half goes to paying the principal and the other half goes to finance charges.  In reality, I shell out 7,200 pesos annually and the credit card company makes 7,200 pesos.

My baby step?  Stop myself from bleeding 7,200 pesos per year.  Imagine if the bleeding stops, in ten year's time that is 72,000 pesos which can be invested in assets that generate money.  After I've done this,  I hope to pay off personal loans from relatives and salary loans from government agencies.


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