SUMMARY OF THE BOOK,
RICH DAD'S CASHFLOW QUADRANT
by Robert Kiyosaki with Sharon L. lechter, C.P.A. 

Each of us has one way or another through which cash flows to us. Each of us resides in at least one of the four quadrants of the CASHFLOW QUADRANT depending on where your cash comes from.

This is the cash flow quadrant:
E quadrant – employee
S quadrant – Self employed
B quadrant – Business owner
I quadrant – Investor

You are either an employee (E), a self employed (S), a business owner (B) or an investor (I).

Though financial freedom can be found in all four of the quadrants, the skill of a “B” or “I” will help you reach your financial goals faster.

The wealthiest people master the skills of the B and I quadrant.

What it takes to become financially free is not primarily money neither is it a good college degree ( Henry Ford, founder of Ford Motors, Bill Gates, founder of Microsoft; Ted Turner, founder of CNN, did not have college degrees. They just built successful businesses). Rather, it takes a dream, a lot of determination, a willingness to learn quickly, and the ability to use your God-given assets properly and to KNOW WHICH SECTOR OF THE CASHFLOW QUADRANT TO GENERATE YOUR INCOME FROM.

Different methods of income generation require different frames of mind, technical skills, educational paths and personalities (even if it is the same person in the different quadrants).

WHO you are at the core determines which quadrant you will best fit into.

You can be rich or poor in all four quadrants. There are people who earn millions and people who go bankrupt in each of the quadrants.

“E” QUADRANT WORDS (Security is important)

“I am looking for a safe, secure job with good pay and benefits”

“S” QUADRANT WORDS (Hire smart people to run their business for them)

“I've got more than 20 hours into this project”

“My normal commission rate is 6% of the total price”

“I” QUADRANT WORDS (Their money makes money for them. This is the playground of the rich)

“Is my cash flow based on an internal rate of return or net rate of return?”

It is in the I quadrant that money becomes wealth.

An “S” owns a job. A “B” owns a system and then hires competent people to operate the system.

Bill Gates did not build a great product. He bought somebody else's product and built a powerful global system around it.

The definition of wealth:” The number of days you can survive without physically working and still maintain your standard of living”.

If you want to get rich, you need to learn how to take risks. Learn to be an investor.

Depending on a big company or big government for your financial future is an industrial age idea. It's not for the information age.

People who take risks change the world. Few people ever get rich without taking risks.

Anyone can change quadrant with the right skills and determination.

Financial security or freedom is seldom found in the “E” or “S” quadrants. True security and freedom are found in the “b” and “I” quadrants.

To become more financially secure, I suggest, in addition to performing their jobs in the “E” or “S” quadrants, individuals become educated in the “B” and “I” quadrants.

Just as we study at school to learn a job, we should study to learn to be professional investors.

Your boss's job is not to make you rich. Your boss's job is to make sure you get your pay check. It is your job to become rich, if you want to.

If you have poor money management skills, then all the money in the world cannot save you.

If you budget your money wisely, learn about either the “B” or “I” quadrant, then you are on your own path to great personal fortune and most importantly freedom.

The fact is, people who work the hardest do not wind up rich. If you want to be rich, you need to “think”.

Security is a myth. Learn something new and take on this brave new world. Don't hide it.

The seven steps to finding your financial fast track are:

* AdeWale Adefuye.