Category Archives: Bibliophile

Contains book reviews

Be the Bank, not the Banker

Posted on by under Bibliophile: Cashflow Quadrant

When a panic situation is everywhere people got trapped with fear emotion. We cannot see the cheaply available investment avenue if we cannot think with rational thinking. During such a period, a person who has control over emotions has financial intelligence then he can establish a business and expand it with little effort.

If we have read, having financial intelligence, control over emotions then we can say that time will change but history repeats itself.

Every bull phase has many financial heroes and when it burst, the majority of heroes becomes a villain. So, we have to put lots of care before admiring any of the heroes of a particular time.

An employee has to first pay tax from income that is income – tax then remaining for spending. While for businesses income – spending then remaining for tax.

While governments would like to take more money from corporate bodies, they realize that if they pass abusive tax laws, the corporate bodies will take both their money and their jobs to some other country.

We need to focus on increasing an asset on the balance sheet. This we cannot do in one go. We can slowly and steadily acquire assets without getting over-leverage and without taking additional risk.

Start small, and take your time. Experience is more important than money.

We need to transfer our thoughts process from “I can’t” to “how I can do it”. Then we can see that the results get started. But it’s not an easy and short process. It will take time and effort to change the thoughts. Another point is when we are working for being “B” and “I” then we need to focus on understanding laws and take benefits from them.

We should focus on reading history and try to learn from it. So that we can understand the cyclical nature of any market. And we can take benefits of those nature.

We have two choices, either we can choose security or freedom. If we go for security then we have to pay a huge price and taxation. If we go for freedom then we can learn to play this game and can play it wisely.

Read for more detail: Rich Dad’s Cashflow Quadrant: Guide to Financial Freedom

How Do I Get Rich?

Posted on by under Bibliophile: Cashflow Quadrant

In reality, that is how simple the path to extraordinary wealth is. In other words, in this high-tech world, the principles of great wealth remain simple and low-tech. I would say that it’s merely common sense. But too often, when it comes to the subject of money, common sense is uncommon.

If we focus on what is a real asset of rich people then they think differently. If we keep on following the same path that all others are following then we end up with tax payments and debt.

First, we need to start thinking differently from what common thinking is. If we focus on who we are and what we want to do then we can achieve what we want.

We need not do something just shake of doing it. We have to put our best into it. If we do not put our full efforts with willingness then we cannot able to continue it for a long time.

People focus on what the rich have and tried to own the same. But not the way rich has own. Other people focus on looking rich, not being rich and that will blow them up. It is all about being, not doing. When we focus on doing a workout then it will not last long. But when we focus on being fit then it will longer till the end. Similarly, with rich, we can be rich, not we can do rich. Changing our thinking does not cost anything but in reality, changing our core beliefs are hard. If we focus on being fit then doing workouts and having a perfect body will come as a result. So that we have to focus on being rich.

The rich or middle class, we all are human beings and as human beings, we all have an emotion. When it is about money, our emotions get stronger. But how we manage our emotions, makes us different individuals.

When it comes to money, we all have a fear of losing it. This emotion will make us a prisoner and we keep on doing work for money. When we can control and focus on emotions, we can achieve what we want. It’s not only about the financial field but the same I have observed during my workout journey. When we control our emotions, we become mature.

Sometimes, we feel that we are making a rational decision, but those decisions are purely affected by our emotions.

When we make any decision, others’ opinions always come to stop us. They laughed at our decision; they quote that you can’t do it. But we should focus on our strength and control emotions by saying we can do it. Changing a quadrant is an internal journey, we have to learn the new mindset and new skillsets. 

What’s the main difference between winners and losers? Losers keep giving more investment to their losing positions and winners cut the losing positions. Winners know that losing can come in the way of winning so they do not stay in ego that they cannot lose.

Above emotional biases stop us from taking wise, rational decisions. If a person’s emotions think for them, those emotional thoughts often blind them from seeing anything else. Emotions always need to control and that is a key to success in an “I” quadrant.

Knowledge is overrated. Temperament comes first then experience and then knowledge which was quoted by Mr. Durgesh Shah sir in one of its interview.

Read for more detail: Rich Dad’s Cashflow Quadrant: Guide to Financial Freedom

Becoming Who You Are

Posted on by under Bibliophile: Cashflow Quadrant

Money is like a drug. When we become addicted to work for money then it will be very difficult to change that habit (rather than an addiction). We get happy when we have money and upset when do not have it. And it is a reason why we cannot shift to the B and I quadrant easily.

An “E” works for the system.

An “S” is a system.

A “B” creates, owns, and controls the system.

An “I” invest money into the system.

Money addiction creates a fear within us. whereas our passion helps us to build a business, not our fear.

Many times, during a recession, hits the economy, few of the companies decide to cut employees’ strength and due to this decision, lower-level employees have to face major prices. So, seeking security becomes riskier. While this kind of fear does not chase B and I quadrant people. They work on improving the system, enhancing the system, and improving their financial knowledge.

Many of us trained with fears since our childhood which has created difficulties with change quadrant. When we want to achieve a bigger success then we need to have a faster processing time with higher accuracy. We can go how much fast, we want. But need to remember one thing is never taking a shortcut. Shortcuts will not lead us towards results but it will trap us in midways. Financial intelligence, not an emotional decision, and focus on numbers always help to achieve our financial goals.

Read for more detail: Rich Dad’s Cashflow Quadrant: Guide to Financial Freedom

I am grateful to Mr.Meihol Jhaveri (Founder of Gatisofttech) for the development of the Lucky Idiot website.

You Cannot See Money with Your eyes

Posted on by under Bibliophile: Cashflow Quadrant

If we see some tempting offer then we must have to be suspicious. There is no free lunch available.

We have to analyze various aspects before making any investment. We may make mistakes and mistakes are essential to learning about and correcting them for better growth.

People make an investment with emotion rather than with mind which led to losing money by a majority of people. At last, they become a dreamer, speculator, or broke down. When someone told us about a good deal and earning good in the future then our emotional bias comes into the picture and become greedy as well. This emotion stops us from making wise decisions.

If we want to be successful in the B and I quadrant then we have to train our mind that we can observe what others used to ignore. We can start by getting more about financial literacy. Our ability to create more money will bring more money for us. This education helps us with taking proper steps and investing becomes less risky for us. Education will help us to differentiate between good and bad advice.

Also, when we know about investing, we or our advisors choose to provide us higher yield with a less risky avenue.

We need to understand that when we buy any property on a mortgage then that’s not our assets rather than its and assets of a bank. It will fall under the liability side of the balance sheet. When we fail to make payment on time, the bank will take over that property from us. Taking debt is not always bad but if we take personal debt then it must be small. And if we go for a huge dent then someone working for paying it. That’s means business debt.

As we have learned in the series of rich dad poor dad that we consider assets to only be those properties that generate a cash inflow to us. All other properties are considered as our liabilities.

Now, comes to savings and deposits then yes those are not taking any cash flow out from us so that is our first level of assets.

Many of us spending our life on the opinion of others rather to focus on the fact. We should only trust facts nothing else.

When it comes to money, most people are either lazy or searching for shortcuts, so they don’t do enough due diligence. And there are still others who are so afraid of making mistakes that all they do is due diligence and then do nothing.  Too much due diligence is also called ‘analysis paralysis.’ The majority cannot become financially free because they live in debt till die. So, this will not bring freedom for them.

Read for more detail: Rich Dad’s Cashflow Quadrant: Guide to Financial Freedom

I am grateful to Mr.Meihol Jhaveri (Founder of Gatisofttech) for the development of the Lucky Idiot website.