Are you a highly-compensated employee who has, in the past ten years, struggled through mergers, acquisitions, down-sizings, right-sizings, outsourcing, layoffs, and multiple moves to different locations, starting over with different companies, wondering what ever happened to the shining visions you had when you first graduated from college? My husband is, and my children and I have traveled down this painful path with him, suffering enormous psychological and emotional tolls in our pursuit of the American dream.
During our multiple moves, I was self-employed as a Music teacher and musician, building a small business only to have to start over again and again (for the fourth time since 1996....)
Robert Kiyosaki's book is the first book which identified why we were feeling all this pain while we were working so hard and doing all the right things. According to him, we have left the industrial age, and are now in the information age, and, consequently, we need how to depend on ourselves for our security.
He describes four "cash-flow quadrants" under which people earn money: Employee, Self-Employment, Business, and Investment. Only in the business and investment quadrants can people build assets which will continue to grow and develop without ever-increasing amounts of work.
His explanations of the difference between self-employment and business told me why my "business" will never make me rich. As a solo player, only my increased efforts will bring me more income. Building a business will magnify those efforts exponentially.
His explanation of why a "home" is not an asset also made sense to me (try selling three expensive homes in four years, and you'll learn why they're not assets.) Only those "assets" which produce a positive cash-flow are truly your assets.
One of his most interesting predictions involved the stock market, a subject in which I have an avid interest. He predicts that, around 2010, when baby boomers start withdrawing the IRA money they've been accumulating for retirement, the stock market will suffer huge cash withdrawals, putting serious pressure on its bottom line.
I had never heard anyone else draw that conclusion, but it made a great deal of sense to me. I will definitely be paying lots of attention to my investments when the first boomers start retiring.
We are rethinking our positions in the cash-flow quadrant in our next move...we are renting our "home", and investigating the "B" and "I" quadrants further. My husband's employment has brought us lots of financial security in the past, but I think we'll learn to build our assets in different ways in the future.
The Cash Flow Quadrant: Rich Dad, Poor Dad's Sequel
The Cash Flow Quadrant explores Kiyosaki's philosophy in greater depth, and gives more concrete suggestions for action.
To read this review, written on December 22, 2000, please go to:
http://www.epinions.com/book-review-7384-42B58408-3A44D408-prod3
