Rich Dad's CASHFLOW Quadrant. Robert T. Kiyosaki

storm, a way station on the path of life. By joining a CASHFLOW club, you get to meet people like you, people who are committed to making changes, not just talking about change.

      Unlike school, there is not a requirement of past academic success. All that is asked is a sincere desire to learn and make changes. In the game, you will make a lot of mistakes in different financial situations and will learn from your mistakes, using play money.

      CASHFLOW clubs are not for those who want to get rich quick. CASHFLOW clubs are there to support the long-term mental, emotional, spiritual, physical, and financial changes a person needs to go through. We all change and evolve at different rates of speed so you are encouraged to go at your own speed.

      After playing the game with others a few times, you will have a better idea of what your next step should be and which of the four asset classes (business, real estate, paper assets, or commodities) is best for you.

       In Conclusion

      Finding one’s path is not necessarily easy. Even today, I do not really know if I am on my path or not. As you know, we all get lost at times, and it is not always easy to find our way back.

      If you feel you are not in the right quadrant for you, or you are not on your life’s path, I encourage you to search your heart and find your path in life. You may know it is time to change if you are saying things like the following statements:

       • “I’m working with dead people.”

       • “I love what I do, but I wish I could make more money.”

       • “I can’t wait for the weekend.”

       • “I want to do my own thing.”

       • “Is it quitting time yet?”

      My sister is a Buddhist nun. Her path is to support the Dalai Lama, a path that pays nothing. Yet, although she earns little, it does not mean she has to be a poor nun. She has her own rental property and investments in gold and silver. Her strength of spirit and her financially educated mind allow her to follow her life’s path without taking a vow of poverty.

      In many ways, it was a good thing I was labeled stupid in school. Although emotionally painful, that pain allowed me to find my life’s path as a teacher. And like my sister, the nun, just because I am a teacher does not mean I have to be a poor teacher.

      Repeating what Thich Naht Hahn said: “The path is the goal.”

       Introduction

WHICH QUADRANT ARE YOU IN?

       The CASHFLOW Quadrant® is a way to categorize people based on where their money comes from.

      Are you financially free? If your life has come to a financial fork in the road, Rich Dad’s CASHFLOW Quadrant was written for you. If you want to take control of what you do today in order to change your financial destiny, this book will help you chart your course.

      This is the CASHFLOW Quadrant. The letters in each quadrant represent:

      Each of us resides in at least one of the four sections (quadrants) of the CASHFLOW Quadrant. Where we are is determined by where our cash comes from. Many of us are employees who rely on paychecks, while others are self-employed. Employees and self-employed individuals reside on the left side of the CASHFLOW Quadrant. The right side is for individuals who receive their cash from businesses they own or investments they own.

      The CASHFLOW Quadrant is an easy way to categorize people based on where their money comes from. Each quadrant within the CASHFLOW Quadrant is unique, and the people within each one share common characteristics. The quadrants will show you where you are today and will help you chart a course for where you want to be in the future as you choose your own path to financial freedom. While financial freedom can be found in all four of the quadrants, the skills of a B or I will help you reach your financial goals more quickly. Successful E’s need to become successful I’s to ensure their financial security during retirement.

       What Do You Want to Be When You Grow Up?

      This book is, in many ways, Part II of my book, Rich Dad Poor Dad. For those of you who may not have read Rich Dad Poor Dad, it is about the different lessons my two dads taught me about money and life choices. One was my real dad, and the other was my best friend’s dad. One was highly educated and the other was a high school dropout. One was poor, and the other was rich.

       Poor Dad’s Advice

      Growing up, my highly educated, but poor, dad always said, “Go to school, get good grades, and find a safe secure job.” He was recommending a life path that looked like this:

      Poor dad recommended that I become either a well-paid E, employee, or a well-paid S, self-employed professional, such as a medical doctor, lawyer, or accountant. My poor dad was very concerned about a steady paycheck, benefits, and job security. That’s why he was a well-paid government official, the head of education for the State of Hawaii.

       Rich Dad’s Advice

      My uneducated, but rich, dad offered very different advice. He said, “Go to school, graduate, build businesses, and become a successful investor.” He was recommending a life path that looked like this:

      This book is about the mental, emotional, and educational process I went through in following my rich dad’s advice.

       Who Is This Book For?

      This book is written for people who are ready to change quadrants, especially for individuals who are currently in the E and S categories and are contemplating moving to the B or I category. This book is for people who are ready to move beyond job security and begin to achieve financial security. It’s not an easy life path, but the prize at the end of the road, financial freedom, is worth the journey.

      When I was 12 years old, rich dad told me a simple story that guided me to great wealth and financial freedom. It was his way of explaining the difference between the left side of the CASHFLOW Quadrant, the E and S quadrants, and the right side, or the B and I quadrants. The story goes like this:

      “Once upon a time there was this quaint little village. It was a great place to live except for one problem. The village had no water unless it rained. To solve this problem once and for all, the village elders asked contractors to submit bids to deliver water to the village on a daily basis. Two people volunteered to take on the task, and the elders awarded the contract to both of them. They felt that a little competition would keep prices low and ensure a backup supply of water.

      “The first person who won the contract, Ed, immediately ran out, bought two galvanized steel buckets and began running back and forth to the lake which was a mile away. He immediately began making money as he labored morning to dusk, hauling water from the lake with his two buckets. He would empty them into the large concrete holding tank the village had built. Each morning he had to get up before the rest of the village awoke to make sure there was enough water for the people. It was hard work, but he was very happy to be making money and for having one of the two exclusive contracts for this business.

      “The second winning contractor, Bill, disappeared for a while. He wasn’t seen for months, which made Ed very happy, since he had no competition.

      “Instead of buying two buckets to compete