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Robert Kiyosaki wrote a book called 'Cash Flow Quadrant' that talks about a person being in one of four quadrants. You are either an employee (the 'E' quadrant), self employed (the 'S' quadrant), a business owner (the 'B' quadrant) or an Investor (the 'I' quadrant).
What determines the quadrant that you are in is how you get your money.
"E"- Employee
You get a paycheck. You have a job. You trade in time for money. To illustrate this, just yesterday a collegue tells me that he worked for a certain company in the construction industry, seven days without time off. He was paid per fortnight, very good money. He would get home and give the wife a fat paycheck but he would not have time with her. He says at one time he worked in Polokwane and he was driving there on a daily basis, seven days a week, leaving Johannesburg at 4am and getting back at 10pm. He did this for six months continuosly but in that time he was negotiating with his boss to get him accommodation in Polokwane.His boss got him accommodation in the seventh month two months before the site was finished. At one time the company bought second hand trucks in Botswana so he was tasked with taking drivers to Zeerust to bring the trucks. The trucks were in poor condition, broke down on the way and that exercise took more than twenty four hours. He had not slept, having left Johannesburg at 4am on a Saturday and arriving 6am Sunday. He briefed the boss on the journey and the boss told him he expects him to go and frshen up and be at work by nine. He came to work at 9, the boss took him to breakfast and let him have the day off. He went back home and slept the whole day. He is a divorcee and attributes that to his work
The "S" Quadrant
You are self employed.
You own a job.
To illustrate this a couple of years I had a very good Doctor. He practised privately. He was Greek. His appointments would run three hours late but the patients would wait. When this Doctor went away to Greece on holiday he would get stand-in for the duration of his leave. There would be a few patients going to his practise. When he did come back there would practice with the stand-in Doctor for some time in different consultation rooms. The queue to the owner of the practice would be unbearably long while there would be a few people prepared to see the stand-in Doctor. In other words the Doctor has to be there to maximise his income. The Doctor is the magic in his business.
In this quadrant are business owners. You must own a system, whether bought or developed by you. You hire in people towork th system thereby working less, earning more and enjoying more free time. The system becomes the bridge to financial freedom.
I love this topic absolutely love it. I was taught about this many years ago by a friend and mentor after my first business failed. Never knew who it originated from. Thanks for sharing emganwini.
This is the playground of the rich where investors make money with money. Money gets converted to wealth. People in this quadrant are free to work or not to work. They have complete physical freedom from work.
There is complete financial freedom. This is when you have tangible assets that throw off additional cashflow.
I love this topic absolutely love it. I was taught about this many years ago by a friend and mentor after my first business failed. Never knew who it originated from. Thanks for sharing emganwini.
I so agree with you, I also really enjoy this topic and this is how I always start my presentations, by explaining the "Cashflow Quadrant"
Another excellent book for Network Marketers by Robert Kiyosaki is "The Business School - For people who like helping people"
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