Charlotte Howard Consulting Blog

Which Quadrant Do You Fall Into: Robert Kiyosaki Explains

The Cash Flow Quadrant is the sequel to Robert Kiyosaki’s bestseller book Rich Dad, Poor Dad. For a better understanding of the sequel, it is highly advised to read first the first book.

Robert Kiyosaki’s describes the cash flow quadrant as ‘a set-up where one goes vertically, and another line goes horizontally. The lines cross in the middles to create four separate areas. Each area is labeled accordingly.

1. The top left side is “E”. This includes employees who work full time, complete with the benefits. This can be any job form a chef to a school principal.
2. The bottom left side is “S”. A self-employed person belongs here. This can be doctors and small businessmen.
3. The top right side is “B”. This area represents business owners. B differs from area S in terms of involvement. Small business owners are directly involved in the operations of their business. If they miss work, then there’s no money. On the other hand, big business owners work in a way that their business still runs with or without them.
4. The bottom right side is “I”. This area includes investors. This describes people who don’t work for money but instead money works for them. This is where most people would want to be.

The Cash Flow Quadrant offers a reader friendly concept. Anyone will have no difficult grasping into it. In summary, Kiyosaki describes the different types of working people and the way they earn money. The left side of the quadrant describes people who wok hard for money. These people will be the first ones to pay taxes. However, it seems that they find it difficult to avoid the “rat race”.

The right side of the quadrant represents people who take money as a tool. These are the people who are paid first, pay their taxes later, but still get more time to enjoy life. There is no wrong side of the quadrant. Everything depends on the person on how they view their sources of income.

Just like Kiyosaki’s other works, this book works on the concept of motivation and thought. The book does not give readers ideas on hoe to get rich quickly rather it I something than gives the reader the varying notions of living and succeeding in financial goals. Kiyosaki also debunks the idea that school is a necessary requirement in getting god jobs. He points that the cause failure is fear rather than stupidity.

Kiyosaki’s confidently presented his ideas on this book. It prompts reader to ask themselves the inevitable “what ifs?” This is a good read for people looking for a new perspective on financial freedom. It is important to note that the book is not for people who wish to get rich quickly but rather for people who wishes to consider other perspectives.

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