Book Summary: Cashflow Quadrant
2 min readOct 21, 2018
- Moving from E (employees) and S (self employed) to the right quadrants B (business) and I (investors)
- For someone who has a job you can’t really explain why you don’t want one
- Thinking is the hardest task that is why so few people engage in it
- Self employed people are very independent, perfectionists.
- Employees care about security
- Technical skills needed for leadership: marketing, sales, accounting, management, reading financial statements, production and negotiation
- Working with people: hardest skill
- Mutual funds are not less risky. Blue Chip stocks give the illusion of safety. Diversification does not lead to the most optimal or even safe outcomes. You’d much rather invest in fewer and better businesses
- Savers are one of the nicest losers
- Recommended path, go from E to B then I. It will make you a better I
- 5 levels of investing: don’t invest at all, only save, too busy to invest, small time with little knowledge investor and efficient capitalist investor
- Starting with nothing is not an excuse.
- Becoming a capitalist involves knowing how to make money using other people’s money
- Tax lien certificates let you earn interest in unpaid property taxes. And if the tax is not paid, you get to own the property itself
- Find out which type of investor you are : type a, b or c
- Dig yourself out of your rabbit hole of debt if any
- Reduce your cash flow to not so important expenses. Keep a set amount free to invest.
- Find out about real estate or stock market, whatever interests you.
- Be truthful to yourself. Personal truths are some at moments of peak emotion.
- If you don’t trust yourself and your decisions, your money won’t stay with you
