Richdads-CASHFLOW-Quadrant-

CASHFLOW Quadrant
is “The Rich Don’t Work for Money.” One of the reasons why those in
the E and S quadrants have problems with that statement is because
most went to school to learn to work for money. They did not go to
school to learn how to have other people’s money work for them.
When Kim and I started The Rich Dad Company, we borrowed
$250,000 from investors. We paid the money back once the company
was up and running. Today, the business has returned multi-millions
of dollars, not only to Kim and me, but to companies and individuals
associated with Rich Dad. As I said, capitalists are generous.
My point is that, the moment a person knows how to make money
out of nothing or with other people’s money or a bank’s money, they enter
a different world. It’s a world almost exactly opposite from the E and S
quadrants’ world of hard work, high taxes, and low returns on investment.
The reason most people believe saving is smart and a 10 percent
return in the stock market is worth it is simply due to a lack of
financial education.
Your best ROI is not a return on your investment, but a return
on your information. This is why a financial education is essential,
especially for the uncertainty of the world ahead.
Remember this about the word “education”: “Education gives us the
power to turn information into meaning.” In the Information Age,
we are drenched with financial information. Yet, without financial
education, we cannot turn information into useful meaning for our lives.
In closing, I say the I quadrant is the most important quadrant for
your future. No matter what you do for a living, how well you do in the
I quadrant will determine your future. In other words, even if you make
very little money in the E or S quadrant, financial education in the
I quadrant is your ticket to freedom and financial security.
For example, my sister is a Buddhist nun. She earns nearly zero in
the S quadrant. Yet she attends our investment courses and has steadily
been increasing her financial education. Today, her future is bright
because she stopped saving money in the bank and buying mutual
funds and began investing in real estate and silver. In the ten years
between 2000 and 2010, she has made much more money in the
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