Robert Kiyosaki's 4 Different Types of Income!

Robert Kiyosaki's 4 Different Types of Income!

 

 

4 Cashflow Quadrants!!!

Today we will be talking about financial independence and financial freedom as assessed by the financial mentor and Guru - Robert Kiyosaki. Roberts two books 'Cashflow Quadrant' and 'Rich Dad Poor Dad' are two fantastic books which I read early on in my ongoing self-develop and education. What they taught me, I will be writing about below as I write about and explore with you the four quadrants of financial capital and income.

The four Quadrants.

The Four Quadrants which Kiyosaki explores in many of his books and products are the:

1. The E-Quadrant.

2. The S-Quadrant.

3. The B-Quadrant.

4. The I-Quadrant.

Exploring the E-Quadrant

The first Quadrant which Kiyosaki talks about, at the top left hand corner of his model is the E-Quadrant. The E-Quadrant represents Employed People or Employees who work in a JOB. JOB, which is an acronym for Just Over Broke represents well over 85% of the global world's population. Here people work for others and receive a regular income or pay check so that they can function in society buying and paying for the essentials such as Food, Water, Gas, Electricity, Housing and Entertainment.

The Benefits and Burdens of the E-Quadrant

* The benefits of this particular quadrant is that if you find the right job, then it is assumed that you will be financially stable and receive a regular pay packet. This is of course assuming that you can continue to turn up at work and your place of employment.

* The burdens of this quadrant is that there are only so many hours in the day. Also that you can be fired at any time without notice and that you can be replaced or find yourself without a job rather quickly if things go pear shaped in your employment. Perhaps this is why it is better for you to be Self-Employed

Exploring the S-Quadrant

The second Quadrant on the bottom left hand corner of Kiyosaki's system is the S-Quadrant. This Quadrant represents the Self-employed person who is either a consultant or the type of person who manages their own private business and/or income. The person who operates and works in the S-quadrant has both the freedom and burden of managing their own life and their own circumstances a.k.a. their future through the use and management of their own income, labour and resources.

The Benefits and Burdens of the S-Quadrant

* The benefits of this quadrant is that, when a person fully develops their small business has the opportunity to pay themselves, reduce their tax and also has the ability to make more money than their employees or people who are employed in a day job.

* The burdens of this quadrant is time. There is only so much time in the day and physical energy which can be used as labour in order to create certain capital required to make them a person of wealth and/or riches. This is why it is important to develop your small business into a big business, allowing you to increase your income while leveraging your time.

Exploring the B-Quadrant

The third quadrant, on the top right hand side of Kiyosaki's system is the B-Quadrant. The B-Quadrant stands for big business and is the type of business which entrepreneurs, multi-millionaires/billionaires and people who have evolved their Small businesses or S-Quadrant businesses from the left to the right side. Here, in the B-Quadrant people are able to leverage their time and their wealth so that other people can run their business for them and this allows them to become financially independent and wealthy.

The Benefits and Burdens of the B-Quadrant

* The benefits of this quadrant is that when it is fully set up the entrepreneur or millionaire can walk away from the business and have someone else manage this for them. This is real freedom for the individual that wants to dictate the destiny of their own life.

* The burdens of this quadrant is that like all businesses including financial institutions and banks, they can be too big to fail (2008 financial crash) and that sometimes, even when leaders walk away from their businesses and have someone else manage for them - They can still collapse, go bankrupt or have fraud take place etc. This unfortunately can also affect investors.

Exploring the I-Quadrant

The fourth and final quadrant at the bottom right hand side is the I-Quadrant which stands for investor. Investors are the types of people who have made enough money from the different types of income streams in E-S-B or from their own previous investments in order to make money over long periods of time such as through Compound interest (Read Yesterdays Post on Warren Buffett) or similar methods and to make money work for you, instead of you having to work for money.

The Benefits and Burdens of the I-Quadrant

* The benefits of this quadrant are the ability to leverage your time, your money and your circumstances in such a way, if you are financially intelligent enough to keep increasing your wealth, buy what you need to survive and to keep increasing your ability to be successful in further investments.

* The burdens of this quadrant are that you can lose all and everything and have to start again. That money once worked so hard for in order to be gained, can be lost. This is the primary difference between each quadrant in what is lost and what is gained through working within them.

The Primary differences between each quadrant

The differences between each  E-S Quadrants and B-I quadrants is the ability to have time and financial freedom vs. time and financial expectancy. I.e. You expect to receive X amount instead of working to have X amount keep coming in, even while you sleep. An example of this is being an employee or Self-employed and how if and when you stop working, you stop receiving more money.

Contrast this with owning a big business or being an investor. In either case this means that as long as you understand, work hard and learn your craft in business/investment that - Even while you sleep you will be making ongoing cash, whose potential will only increase as time goes along with further work and reinvestment.

Investment is important, wherever you fall or find yourself in your financial education and quadrant. Indeed no matter which quadrant you find yourself within, just remember you have the ability to change quadrants and by doing so, change your future.

You can find Kiyosaki's two books at Amazon.com here:

Rich Dad's Cashflow Quadrant: Guide to Financial Freedom

Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money--That the Poor and the Middle Class Do Not!

Warren Buffett and Compound Interest!

Warren Buffett and Compound Interest!

"My Wealth has come from a combination of living in America, some lucky genes, and compound interest" - Warren Buffett

Warren Buffett is an investor, business entrepreneur and visionary. He was born in and remains in Omaha Nebraska.

For most of his life, Buffett has been entrepreneurial yet he did not make most of his wealth until he was in his 30's and 40's. In the post-modern world he is the second richest man in America, with only Bill Gates and his technology company Microsoft being 10 billion dollars in front of him in stock holdings. Unlike Gates however, Buffett does not believe in having stock in technology or anything which could potentially collapse or fail over night. Buffet fancies himself a conservative in his values and would rather invest in companies and consumerables which would have a long-term gain.

Because of this he has continued to believe throughout the duration of his life in the power of stocks, bonds and similar types of investment capital which work towards long-term financial and economic solutions. This type of capital, he believes in particular could be used and compounded in interest, dividends and etc. in order to create so much wealth over a long period of time that someone who started out with a small investment could in 5-40 years using buffets method... Retire from the workforce quite wealthy and rich. This is also echoed by Robert Kiyoskai in his work on the four quadrants, something we will talk more about tomorrow.

Buffett is eccentric and he lives in his house in Omaha which he bought in the mid to late 1950's and owns to this day. He lives below his means and even owns a car which he has not updated since the 1970's and only spends on himself as an annual income of 50-thousand American dollars per year. (Business income). A few years ago, due to his advanced age, he was forced to be less frugal and buy himself a private jet named "The Indefensible" which he used both in his  private business dealings and also in his work on Philanthropy.

Buffett spends quite an amount annually on philanthropic enterprises which he believes will ultimately help the future of humanity on this planet survive. For buffet survival and success are tied together as one and this is why the focus on successful philanthropic enterprises for Buffett is so strong. But what is the key to Buffett's success, be it in business, Philanthropy or in life? Buffett draws his success down into two words. These are "compound" and "interest". Buffett believes that most of his success comes from the compound interest accumulated by his investments over his lifetime. He notes that for most of his investments made, he will invest not in the shorterm, not even in the long-term but within the scope of his own and others lifetimes.

Buffett does not care if stock loses 200 points one day and gains 800 points another. What he is looking for is the longevity and survival of the stock through which he has made an investment over the course and duration of his lifetime.When Buffett started investing he only had $9,800 which was quite a small fortune back in the 1950's. He was able to save it up and made $127,000 in savings. Buffett estimated that he could live off $12,000 per year and make a huge fortune off the rest via compound interest.

When he found that he became quite wealthy, other people started to give him their money and pay him to look after their investments, money and similar forms of capital and that is how Buffett's business Berkshire Hathaway was born. So what did Buffett have that other men and woman who invest did and do not? Simple, Buffett has a vision and having a vision is important to your success wherever you are in life that and perhaps understanding compound interest the way Buffett does.

Daniel Counts. November the 5th 2013

 

Becoming Financially Intelligent!!!

Becoming Financially Intelligent!!!

This week we will be discussing different aspects of financial intelligence.

What does it mean to become financially intelligent, to become financially independent and to also have the ability to use your finances widely and wisely in order to help others? Good question, I will leave those aspects of financial intelligence up to you. The one thing I will say however, is that it is not money which makes you a successful man or woman... Rather, it is the intent with which you have around the money you create and bring into existence which makes your attitude and better self valid in this lifetime. 

The intent which people have, creates their life. Money and the use of money is a bi-product of this intent, allowing a person depending upon their level of self-growth and spiritual maturity to create the correct amount of resources with which they envision for themselves in the creation of their success and the help of others. Considering financial attitudes, we will cover three different types of people and their varying levels of financial intelligence towards the betterment of all humanity. 

This week, some of the topics on financial attitudes, freedom and independence will be:

* Wednesday; Explorations into different types of investing by talking about Warren Buffett, his idea on wealth creation, financial capital and compound interest.

* Thursday, a discussion on Robert Kiyosaki and his ideas on the four different types of wealth quadrants and how these apply to financial investment in your everyday life.

* Friday we will talk about Winston Shrout and how his ideas on bonds, notices of interest and birth certificates have influenced people to discharge debt.

* Saturday, will explore different ways of creating income and provide a book review.

* Sunday, will explore how to save money and how to live cheaply. Helping you better afford the lifestyle that you want.

This is a short post, as life is busy. But hey... What is more important in your life, when you are busy than to explore your ability to become more finically intelligent and educated? Education be it in finance, in relationships or enhancing your health etc. involves your ability to become more intelligent and move forwards in the progression and avenues of your life. If I have learned anything over the last years of my life, it is that no one owes you anything other than yourself to create the life that you want... On your terms.

That my friends is the start of a financially independent and driven life.

Count. Daniel John Fogarty, Tuesday 29th of October 2013

Women Better Understanding Men!

Women Better Understanding Men!

Since this week has been about relationships, I thought it would be appropriate to conclude it with content on relationship coaching to improve the content of couples and their relationships. Instead of all the material on the web about how men can better understand woman, I thought it would be appropriate to review a book on how woman can better understand men.

In so doing, help men and woman in their relationships to get on better, understand one another and improve the quality of their recreational, love and social lives.

Ladies, if you would you like to understand:

* The emotional needs of men in your life?

* Be interested in understanding men better, so that they can better understand you?

* Understand what a man wants and also what he needs in life?

If so, then look into getting The Eye Of The Seductress: Vol 1 - A Workbook For Women To Learn About The Emotional Needs of Men by relationship coach Frank B. Kermit.

Frank has been a professional relationship coach for 10 years and he delivers what he promises in The Eye Of The Seductress by allowing woman to better understand the men she communicates with and encounters in all areas of her life. Be they her father, her brother, her boss, her son or her lover.

Frank B. Kermit says it on his website:

"This book was written for both women and men to understand the emotional needs of men. It is a great starting point for women and a great education for men to learn about their own emotional needs. This book is designed to teach women how to attract a man and earn his commitment. The techniques you are about to learn is based on what makes even the most notorious confirmed bachelors, and sought after men commit to one particular woman. This book is also a great resource for men to learn how to judge the value of a woman to know if she is worthy of everything he has to offer."

Personally impressed with Franks, frank professionalism and ability to help men and woman understand one another, a reviewer captured the content and importance The Eye Of The Seductress by writing:

"As a relationship coach, Frank is like the big brother that looks out for you and sees your blind spots. He tells you things that you may not want to hear but does so because he knows you deserve better than what you're allowing yourself to experience. Frank teaches women to stop wasting their time on the wrong man and how to recognize the right one. His help with bringing up topics within a relationship has been amazing!" -Patty Contenta, Sensuality Secrets.

In The Eye Of The Seductress Frank states that the ten emotional needs of men are:

1. Protection of his Reputation as Desirable.

- Protect his reputation and keep what he does in the relationship private.

2. Recharge Time.

- Allow a man the ability to have his time out.

3. Can You Mind The Store?

- Allow a man the ability to heal from injury or harm  while suspending his activities and then allow him to come back to what he does best in his life without interference.

4. She must show Compliance to his Dominance.

- Allow a man the ability to lead in the relationship.

5. Nurture of his social-personal environment.

- Help a man look after the family home, children and lifestyle of the family unit.

6. Be The Secret Keeper.

- Trust that when a man shares secrets with you that he trusts you not to break these secrets to others.

7. Put Us (The Couple) First.

- No one else comes in the way of the relationship, including family or friends.

8. Sex, Give Him The Sex He Wants.

- Pretty obvious.

9. Penis Identity.

- Support a man's self image and help him feel masculine.

10. Be feminine.

- Be attractive to him. Appreciative of him and his usefulness while being courteous and giving when he appreciates you.

After reading this book and better understanding my emotional needs as a man, I was able to look back on some of my past relationships where as a man some if not all of these emotional needs were violated and not respected. 

In one particular relationship, quite a few core of my emotional needs were violated where my partner of the time chose her friendship over our relationship. With this she also did not respect my reputation as a man and also did not keep the secrets of our relationship exclusive to the relationship by telling her friends certain private aspects which should have been kept private between us as a couple. Given this, I wish that I had Frank's book on me at the time so that I could explain to her how she broke some of my emotional needs which I needed in order to maintain our relationship together and which led us to breaking up.

So ladies, if you want to understand men then please get this book and please understand that men like woman have emotional needs. This is very important and one of the core reasons why I have written this blog post today and if you would like to find out more about this book and similar materials, you can find them here for your browsing interest:

Eye of the Seducteress Book 1 Link.

Onwards and into a new week, for this week we will be discussing financial intelligence and solidarity. Until then,

Count. Daniel John Fogarty, Real Life Development!!! - Saturday 26th of October 2013