The Cashflow Quadrant
I recently bought three books using MPH vouchers I redeemed from my credit card reward program. Those books are: Rich Dad’s Cashflow Quadrant (Robert Kiyosaki), The One Minute Millionaire (Mark Victor Hansen & Robert Allen), and How to Become a Property Millionaire (Azizi Ali). At first I thought of starting with the One Minute Millionaire but due to small printing (my fault for not opening the sealed book before purchasing) I was a bit put off and chose Rich Dad’s instead. A very easy read. The ideas laid out are simple but it really gets me thinking. I’ve been wanting to play the cashflow game for quite some time. They have a ‘millionaire’s club’ nearby our place where you pay a small fee to play this game. Having read a quater of the actual book, I now have a rough idea about what to expect from the game and the lesson’s I’ll be able to learn from it.
Basically the cashflow quadrant shows us just where our cash is coming from - left side consists of being an employee (E) and being self-employed (S), the right side consists of business (B) and investment (I). Simply said, according to Rich Dad, to become rich your cash must come from the right side of the quadrant (business or investment or both). Because the majority of us are on the left side, this book shows us the steps to take to get to the other side of the quadrant even while still being able to operate from the left. I hope that makes sense.
I am currently in the E quadrant. I hope to be able to also get into the I quadrant soon. And eventually the B quadrant. People in the S quadrant are thought to have the toughest time. Being self-employed means that you are working in your own business.It’s means that you are your own boss. But it also means that you play multiple roles as a manager, marketer, accountant, etc. It’s pretty much a one man show. Sure you may be driven by passion at doing what you truly love at first. But with being self-employed your income depends on how hard you work. When you slow down or decide to take a break, your business suffers.
People in the B quadrant on the other hand create an efficient system that will allow other people to work the system for them. The beauty in creating a system that’s run by others is that you get to take time off and return to find your business further blossoming and making more profits. In the I quadrant you make profit too by making money work hard for you. Both the I and B quadrant ofcourse requires you to have good financial knowledge - something that are not taught in schools.
It is also very much possible for an E to also be an I to acquire financial freedom. You need to have investment knowledge for that. So for me, that’s what I’m trying to do. Working at learning whatever I can to in this area to become financially free.
I’ve been thinking about whether joining Success University makes me a B person. SU definitely has a system (that’s already being laid out for you). But are the founder of SU the only ones in the B quadrant (since they’re the one who came up with the system)? Or are they, through the system also helping others become a B by adapting their system and making financial gains through it? I have to ask Zamri Nanyan about this. Hopefully he can drop by my blog anytime soon.
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