The Cashflow Quadrant Explained
Restored from the Empower Network archive (2011–2017), lightly edited to meet our current advertising standards. Views are the original author’s.
What is the Cashflow Quadrant? Which Side of The Cashflow Quadrant Will You Choose?
I was rolling through my amazon book collection and I came across this book by Robert Kiyosaki call the Cashflow Quadrant.
I never read the book before. I brought the Cashflow Quadrant in the past because someone or some show may have recommended the Cashflow Quadrant.
…I do that often – if someone brings up a dope book about self development I’m all over it.
The Cashflow Quadrant Explained
So what is the Cashflow Quadrant anyway…
The Cashflow Quadrant explains four different ways someone can make money. No quadrant is better than the other – each way can make you financially free, but each Cashflow Quadrant will have a different outcome based on the person you become.
Quick Cashflow Quadrant Diagram
So Let’s Break Down the Cashflow Quadrant
Cashflow Quadrant E = Employee
As an employee I have worked in many possessions from direct support care, retail banking, restaurant management, etc. They all have one thing in common… even thou the income varies the way I make money is the same. Income is paid in a wage and I only make money based on the physical time I give to my employer.
Oh…and don’t let me forget to mention all the taxes an employee must pay because there are no write offs. If you are seeking to earn 100k per year and not use too much of your physical time read this post.
Cashflow Quadrant S = Self Employed
The Self Employed doctor, lawyer, accountant rocks, right? I wouldn’t quite say so. This person may be doing what they love, but for some strange reason the Self Employed person works more hours than the employee at times. The physical time still applies to the Self Employed person, if they don’t work they won’t make any money. Most, rarely go on vacation because they can’t afford to lose the income.
Cashflow Quadrant B = Business Owner
Now we are talking, the business owner in most cases gets paid based on the efforts of others. We like to call it leveraged income. It’s one thing to be the doctor, but to be a doctor who hires doctors, you create more leverage and more freedom to do things outside of the work place…
….and continue to earn income.
This is how people make money in Network Marketing, Online Marketing, Real estate, etc. I love to open my emails and find messages telling me I just earned an commission based on work I did weeks and sometimes months ago.
Cashflow Quadrant I = Investor
Getting into the Investor’s Quadrant should be a huge goal for everyone. Here you don’t really relay on yourself or anyone. Your money is finally working for you. You invest and seat back and collect checks. Of course there are other factors to being a great investor, but once you got it down it is a wonderful thing.
What Cashflow Quadrant are you in? Do you enjoy what you are doing? Do you have the time to do the things you love and travel the world with your family? If this is something you desire in your life click the image below and lock arms with me and the Inbound Cash Team (ICT).
