So last weekend I attended a seminar for the Rich Dad University because one of the first books I read out of high school was Rich Dad, Poor Dad by Robert Kiyosaki. This book was definitely the fire starter that started my mind down the path of self development. Typically they try to sell you on a couple of courses but I go to hear the trainers the speakers usually speak very intelligently and I pick up things I may have not picked up in previous sessions.

1. Robert Kiyosaki’s Cashflow Quadrant How to
Maneuver The Cash Flow Diagram
by Joe Carrera in Lifestyle
Robert Kiyosaki’s Cashflow Quadrant
So last weekend I attended a seminar for the Rich Dad University because one of the first books I read out
of high school was Rich Dad, Poor Dad by Robert Kiyosaki. This book was definitely the fire starter that
started my mind down the path of self development. Typically they try to sell you on a couple of courses
but I go to hear the trainers the speakers usually speak very intelligently and I pick up things I may have not
picked up in previous sessions.
One thing that I wanted to discuss was the cash flow quadrant because this was one of the first things I put
into place when I read the book several years back. I feel it is worth the share because there are many new
people to the game and new generations out there I can help with this.
So today sitting with a few people at my local Panera bread there are other people around the table were all
employees and they therefore discussed how career paths looked from this side of the table, so knowing me
I thought I could be a coach and present them to my career path forecast as an entrepreneur.
I am hoping this will give someone insight as it did for me when I read the book initially and woke my
financial mind.
Robert Kiyosaki’s Cashflow Quadrant
In this post I want to specifically discuss is Robert Kiyosaki’s Cashflow Quadrant. It is draw out very
simplistic to understand but this version is just a little enhanced to add more value for added perspective it
can add to your future.
First take a peek at the diagram and I will break down each quadrant and explain more as I go along. In
essence, all we are talking about today is a cash flow diagram.

2. The diagram is broken into 4 squares hence the quadrant.
Employee – E portion of the quadrant
I would confidently say about 95% of the population is currently in this quadrant. They are an employee
that is employed by a company or an organization and you are basically trading your time for money. In
this linear model basically if you want to make more money you need to work more time (my old
employees loved overtime). Of course you can job hop and get a higher paying job but the cycle is the same
you go to work you make money and if you don’t show up you don’t make money.
Self Employed – S portion of the quadrant
Now most people when they start trying to knock down the cubicle wall because they know or self talk to
themselves. Hmm I am worth more, I can be more they usually transition to the S quadrant and buy
themselves a job. The great thing is they have transitioned they have now moved from reporting to a boss
to now being the boss and work for themselves. Freelancers also belong to this category and such an
example would be like a graphic designer.
Now at first this is awesome because you can work when you want and you can charge what you want but
there’s one problem, if you don’t work then your not making money! You should be proud though because
your not an employee any longer, you have a higher salary but now you have a cool awesome boss, YOU! I

3. help a lot of self employed better their situation because now they are working 80 hours a week trying to
survive.
Business Owner – B portion of the quadrant
Business owner basically owns a system that makes money. This type of system usually has employees
working there and if the owner leaves they can take a two month vacation and the system still operates and
makes money. You no longer have to give hours for you to make money the system is making money even
while you sleep or while you are away.
Investor – I portion of the quadrant
I call the investor someone who has portfolio money which is 1 of the 3 income sources everyone should
have. Similar to the business owner they dont have to trade hours to make money but their money is
working for them. Such examples of investments are; real estate, stocks, businesses etc. Once you make
money in the B quadrant is where you start to drop money in the I quadrant and slowly start to scale this
allocation.
How Did I Get Where I am?
My plan that I help people with is to move from E to B and skip S completely because I do not recommend
trading time for money. I help others get systems in place so they can start an action plan to set a date to
fire their boss. For those that are in the B quadrant and are struggling I help them assess their systems
because one thing I find 98% of the time is the small business owner wears all hats and this blurs their
vision. The small business owner just need certain things in place in order to slowly get the hours back they
are trading.
I am definitely not knocking those who are in the E category because if it works for you great and if you
love it great! I am speaking to those that want more time freedom because I was once spending 12-15 hours
a week in the car just commuting back and forth to work. Also, this is great information for those that want
to retire early or just have enough in their retirement accounts when that time comes.
Robert Kiyosaki himself states that says that the two quadrants on the right own 95% of the world’s assets,
so at least if you want to earn some money -then you should start to take a look at your own career path.
Take action now
So you may be asking okay you have a point but what can I do now? Hmm,
if you’re an employee…
You need to start planning to get out of the E quadrant. Contact me if you need ideas on how or what to do
because all money is like I tell most of the people I work with is an idea.
If you are in the S quadrant
You need to build a product or a system to start creating cash flow. I spend a lot of my time designing and
maintaining current systems that create income for me.
If you are in the B quadrant

4. You need to invest a portion of your proceeds. I know Robert suggests real estate and I will be honest with
I don’t have a passion for that so if you do that’s great but I invest in other things just make sure it
resonates with you so you can learn about it. One thing I love to do is help fund small start ups because the
return is nice and I love being part of the operational start-up.
If you are in the I quadrant
you should be making money already and you are on the right track. Many of you in the quadrant are
probably like me with the money your making your creating new and exciting businesses and just are a
serial entrepreneur.
My only job with this post today was to inspire you to use your head nothing else!
Going through the traditional school system we learn so many things but financial education was not one of
them. Has anyone ever taken a course in 401k? No but you have taken courses on geology and and the
science of rocks….. You see when you read Rich Dad, Poor Dad you will get the same interpretation from
the book this is stuff the rich teach their children so educate yourself and I would love to hear your thoughts
just comment below.
Your Partner,
Joe Carrera