According to Cashflow Quadrant (Robert T. Kiyosaki), there are only 4 ways of making money
Employees
Self-Employed
Business Owners
Investors
80-85 % of the people, who are financially rich, come under category 3 and 4. Common traits are
For them, their money works for them versus people of category 1 and 2, who work for their money.
Their income is not linear, which means that they don’t have to put X amount of time to make ‘X times Y’ amount of money. As oppose to people of category 1 and 2 who has to work of keep their business open for certain number of hours to make certain amount of money.
To be in # 3 or 4 don't you need to have money? Usually people work through #1 and #2 to get in #3,4 or they are born rich and ride on their daddy's shoulders.
Difference between Self Employed and Business Owner
Before we get into any other details, let’s describe what it means to be self-employed and what it means to be a business owner. Sometimes it’s hard to distinguish the two. But here’s a simple way to tell the difference, ask yourself…
“If I disappeared for a year, would my income stop? Or, would my financial situation continue to be about the same?”
If the answer is yes, your income would stop, then you are self-employed.
A simple example of this is a doctor or a dentist who has their own practice. They don’t have a boss so they definitely aren’t an employee. On the other hand, they don’t make any money unless they are there to actually work and help people. So it might seem like they are a business owner because there name is on the sign and they have business cards, but really, they are self-employed.
Compare this to someone who is a true business owner. If they wanted to go away for a year, all they would need to do is tell the CEO to take care of everything while they were gone. All of the other employees in the business would continue doing the same work they were before. Most of them probably wouldn’t even notice that the owner was gone!
With that being said, let’s learn the **key **difference between the life of the self-employed and the life of business owners…
Life Of The Self-Employed
No matter what type of self-employed person you are, or are striving to be, there is something important you should know… The more successful you become, the busier you are going to be!
For example, let’s say that you are striving to be a top business consultant. When you first start out, you aren’t very well-known, and you struggle to keep busy because you don’t have very many clients. But over time, things start to really take off for you. Your customers like what you do and start referring you to other companies. Those companies start wanting your service. They like you as well, and then those other companies start referring you. This goes on until eventually you have an unlimited number of people that want your consulting services.
Now that you are extremely successful, you basically need to work 24 hours a day because you are in such high demand.
Being successful when being self-employed certainly isn’t bad. After all, you can start charging a lot more for your services to cut down on some of the demand. If it’s a job that you really love doing, having the high demand gives you the opportunity to do what you love to do on a constant basis. There’s just one thing that is for sure…
You are going to be busy. If you want to make any money, you are going to have to be their working. The moment you stop is the moment that your money stops as well. If you want a vacation, it’s going to cost you the price of the trip **plus **the cost of not working.
The Different Life Of A Business Owner
The life of a business owner is completely different. With the more success that you have, the **less **you have to work. Why is this?
If you start up a company that floods money into your bank account, this gives you a ton of options. If you want, you can use those profits to hire a top-notch CEO to run the company. You can also hire more employees that will do all of the work that you were doing before.
Unlike a self-employed person, being successful as a business owner gives you more freedom. More time to spend with your family and enjoy life.
If you are a successful business owner, you can go on vacation for a week, even a year if you want. Your business will continue to roll in profits without you. So the only money you are losing is the cost of your vacation.
That’s not to say that being a business owner isn’t hard-work. It’s extremely hard in the beginning setting up a business. And that’s not to say that all business owners hire people to do everything for them. Some owners never stop working their fingers to the bone! I’m simply saying that with more success (unlike the self-employed) doesn’t necessarily mean more work. It often means more freedom. Source
he is a real estate investor among other things... but arguably, it's his motivational speaking engagements and books that have landed him the fame and $$$.
Keeping aside my own bias against motivational speakers, this guy is as "filler" as they come... I saw an ABC 20/20 show where he was a miserable failure as a mentor/coach in helping ppl startup their businesses.
If you want to read on investments etc., I'd go with John Reed over Kiyosaki any day! at least he doesn't make nonsensical claims and his books are more hands-on than motivational fillers.
Originally Posted by MirchMany categories are missing.Inventors.Innovators.Explorers.Discoverers.
These cannot neccessarily be a source of income, mirch .. can they?
Yes they can if your you sell your invention or license it. There are many examples of people making money off of licensing their inventions , innovation, discoveries etc.
TLK you really are gullible. These guys are only out to profit on desperation. I know far too many people that have wasted far too much money and time on seminars, books and audio tapes that promise the world and deliver nothing. It's disgusting.
Problem with all these people, Kiyosaki included, is they'll pitch they have a "secret" way of making their money that can only be revealed if you buy information. What they wont tell you is that they're really making their millions off you. The day Kiyosaki reveals that he's rich in real estate because he has thousands of desperate fans buying his books is the day his scam is revealed.
TLK you really are gullible. These guys are only out to profit on desperation. I know far too many people that have wasted far too much money and time on seminars, books and audio tapes that promise the world and deliver nothing. It's disgusting.
Problem with all these people, Kiyosaki included, is they'll pitch they have a "secret" way of making their money that can only be revealed if you buy information. What they wont tell you is that they're really making their millions off you. The day Kiyosaki reveals that he's rich in real estate because he has thousands of desperate fans buying his books is the day his scam is revealed.
No book says that they have a Mantra which will bring instant cash/profits, these books share ideas, which a creative business man or employee can re-design as per his sector/region. The key point in these books is "work-smart & dedication".
