The Cash Flow Quadrant by Robert T. Kiyosaki
The Cash Flow Quadrant generates passive income cash flow and Kiyosaki proves to be a pretty much cash flow guru loved and respected by many. The Cash Flow Quadrant is a nice inspirational book that reflects Kiyosaki’s storytelling abilities as well as his engaging and empowering prowess. The book contains and gives enough practical advice that can get the reader into the desired quadrant. Kiyosaki has enriched the book with plenty of examples on how an individual can achieve the desired quadrant by explaining in detail the different quadrants and what they entail (Kiyosaki & Lechter 20-34). The author meticulously explains the personality characteristics of every quadrant and further asserts that one can be in multiple quadrants simultaneously such as being an employee and an investor at the same time. Robert Kiyosaki explains in detail the different quadrants including E-Employed, S-Self-employed, B-Business owner, and I-investor.
Description of the personality traits of each quadrant is indeed very interesting such as the one for self-employed professionals such as lawyers whom he describes as fiercely independent and always like taking control of the situation. He explains that the self-employed professionals love doing things on their own and are usually considered perfectionists (Kiyosaki & Lechter 56-72). Kiyosaki further provides an interesting explanation regarding people owning their own business both the businesses in the “S” or “B” quadrant. Kiyosaki asserts that people in the “B” quadrant need to have the ability to lead people and take control of systems as well as working with people and convincing them to follow the business owner’s vision while the “S” Quadrant re business owners who are also self-employed professionals.
Kiyosaki explains that the wealthy are mostly business owners and investors falling in the “I” quadrant and are always looking for ways to minimize taxes while continuing to generate cash flow. On the other hand, Kiyosaki posits that the biggest expense is tax and that the “E” quadrant always continues to pay taxes. He points out at the weakness of the individuals in the “E” quadrant of paying tax unlike those in the other three quadrants who tend to pay minimal tax such as the “I” who pay tax in terms of dividends.
Moreover, Kiyosaki gives a detailed explanation concerning the three types of business systems including the seven levels of investors and the fact that financial advisers can always exploit once financial illiteracy. He observes and offers pieces of advice on how one can become either fall in a “B” and an “I” quadrant, which are the wealthiest people. According to Kiyosaki, the Investor and the Business quadrants are where the assets are concentrated. He highlights some of the ways of taking advantage of one’s own weakness and disappointments and turning them into strengths.
Kiyosaki interestingly advices the reader that everyone should have a mentor and that humility, taking risks and failing in an endeavor are paramount in every successful man (26-44). He believes that failing provides a lesson to open minded individuals who can therefore grow from them. Kiyosaki observes that there are serious dangers in greed and fear and that employee are driven by the two because they normally focus on job security and instant gratification. The book helps in understanding the way things work in the monetary system and further helps readers in their quest for financial freedom.
Kiyosaki, Robert T, and Sharon L. Lechter. The Cashflow Quadrant: Rich Dad’s Guide to Financial Freedom. Paradise Valley, Arizona: TechPress, 1998. Print.