Day 3: How the rich & the wealthy make money in our society

Welcome back. We have made a tone of progress. I promise your determination will pay off BIG in both financial and time freedom.

Before we get started setting up and breaking down your 7 figure income blueprint, let me give you the big picture and remind you once more time why we are building your passion business. If I have to guise, your ultimate goal is to build a business that give you ultimate freedom. “FREEDOM” is the single word that sum it all.
Freedom to control time and money so that you can live your live on your terms.

So, here’s the realization I had…?There are only two ways to gain true time and financial freedom.
For you to really understand how you can gain true time and financial freedom so that you can live life on your terms, like the top 10% percent of the rich and the wealthy, you must first understand how the rich and the wealthy make their income in our society.

Because they don’t teach that in school. In our education system today, they teach you how to get a job not how to become wealthy.

Let Me Introduce You To Robert Kiyosaki - Self Made Millionaire || Investor | Author

When Robert Kiyosaki came along and wrote the books “Rich Dad Poor Dad that made him famous, he was able to give us a way to think about and talk about and look at how the poor, the middle class and the rich make their money. He explained to us the concept through his cash flow quadrant.

This book change my perspective on the concept of making money and creating wealth. I have never look at making money the same again. From when I finish reading this book, I became obsessed with moving away from the left hand side of the Cashflow Quadrant where you trade your time for money over to the right hand side of the Cashflow Quadrant where money work for you.

He simply said, there are four ways to earn money and each of us fit at least into one. Some people fit into two.

Let’s look at them one by one:

Employee & Self Employee

Group A: Active Income Earner

On the left hand side of the board, we have the employee and the self employee.
This guys work an average of 8-10 hours per day to make between $19 to $30 an hour on average. With average income of $40,000 to $80,000 per year. Sound familiar?

They’re on what we call, a 40 Year Plan. (This guys work, 40hrs per week, 40 weeks per year for 40 years. In other words, work 9 – 5, until you’re 65 and hope that you have enough saving by the time you’re 65)

The people on the 40 Year Plan, exchange their time for money. Here is how it looks. You work an hour & get paid an hour. If you work more hours, you get paid for that hour. But when you don’t work an hour, you don’t get paid.

So, as you work those long hours, you try your level best to put some money aside little by little as saving so that you don’t have to work anymore when you reach 65. At least that’s the plan.
But here is the problem. Statistic shows that, most people in our society find it very hard to stick to a saving plan because of their limited income. Almost 100% of the money they make go to cover all the bills that never stop coming.

Making it almost impossible to achieve financial freedom.
Most people in the 40 year plan would turn 65 with no enough money. They either would need to continue working or they would need help from social security or family members. Not a pleasant place to be.
So, these people are stuck in what we called survival mode. They go through their working days feeling angry and frustrated.
80% of people in our society make their money this way. We call these group, active income earners. Why? Because you always have to be physically active to make the money.
To me, this is the worst way of making money. You never get ahead because you have zero leverage.

If you are like me, you want to know what else is out there. What else can you do to achieve personal and financial freedom.

Investor & business owner

Group B: Passive Income Earner

The rich and the wealthy, the top 10% on the right hand side, they know, that’s a prison.

They know that, you can not create wealth by trading time for dollar.

They know that, to be financially free, you must find a way to create some passive income.

Passive income which is the income that continue to be generated after the initial effort has been expended.
In addition, they also know, if you use leverage, you can move weight many time greater than what you can move yourself.

In other words, the wealthy understand that leveraging the effort of others is the key to wealth.
The poor and the middle class on the other hand, are stuck in what’s called “the time for money prison”.

The rich and the wealthy make their money in two ways:
Investor: Being an investor. That is when you take money and make more money from it. The key ingredient here is off cause money. And last time we check, 80% of people don’t have such money lying around. So, only few people have the luxury to make their money this way.

Business Owner: And then the top one which we are more interested in is being a business owner.
The different between a business owner and self employee is that, this guys invest their time, money and effort to create asset and those asset make them money.
This right hand side of the cash flow quadrant are the two ways that will give you the opportunity to achieve personal and financial freedom and with the right vehicle, you could achieve that in just 5 to 10 years.

This are the two ways the rich and the ultra rich of our society make their money.
And they live in the best neighbourhood. Send their kids to the best school. They get to travel in some of the best places in the world. They get the best health care service, They live longer and they live life on their own terms.
These’re the people who live a life of peace, joy and freedom.

But here is the good news. You can live that way too. Because most of these guys who are now in the top 10% where at one point at the bottom 90%.

And the journey you’re taking now is design to help you move from the left hand side of the cashflow to the right hand side.

How You Can Create Passive Income & Make Your Money From The Right Side Of The Quadrant:

Now, let’s look at how we can move from trading time for dollar treadmill scenario to creating passive income. That is our main goal here today. To create passive income, you still need to put forward effort and that effort generate money and that money goes to pay your bills. But what begin to happen is every time you put forward an effort, you also generate a secondary income called passive or ongoing income. Eventually, over a period of time, your passive income will replace your active income and will become the sources of your income.
Let me give you an example, let’s assume that you’re coffee maker. And that you work at a coffee shop. Let’s assume you get $20 an hr for working at a coffee shop. But in addition to the $20 an hr income you receive for serving coffee, let’s assume that every customer that you sold a coffee to, was require to send you $5 a month for the rest of their life. Now, when you sold your first coffee, off cause the $20 an hr is way greater than the $5 a month. So, you want the $20 an hr too. It’s logical. But here is what happen, As you sell coffee, after coffee after coffee, and those $5 begin to compound or add up, what happen is, the $5 a month become your income. And eventually, you’re outta place where you no longer need to sell coffee anymore as you got all those $5 payment coming in from many customers called passive income. And this come in every month and they covered all your bills so you never have to work or worry about money again.

The key to wealth is how to generate passive income for all your effort that you put forward daily. And that is what your passion business in the online space can do for you.

If you are not excited right now, I worry about you. because, I don’t know what else can make you excited 🙂

When one of my millionaire mentor explained to me this great hidden secret about how the rich and the wealthy earn their income, my whole live changed.

The whole time, the only thing I knew was trading my time for dollar. As much as that single principle change my life, I promise you, stick to the course and your life will change as well if you put in the work.

Summery:

To summarise, today we have looked at the 4 different ways you can create income and how only 2 ways can give you the opportunity to become personally and financially free. Which explained how the poor, the middle class and the rich earn their income in our society.

We have looked at examples and scenarios so that you can see how simple it is for you to start thinking and acting like the top 10% do. This is some powerful stuff that if you understand clearly and take to heart, will alter both your personal and financial future forever.

That brings us to the end of DAY 3.

ASSIGNMENT FOR DAY 3 - Your assignment for today is to:

Your assignment for today is to order and start reading Robert Kiyosaki book – Rich Dar Poor Dad.

Rich Dad Poor Dad, the #1 Personal Finance book of all time, tells the story of Robert Kiyosaki and his two dads—his real father and the father of his best friend, his rich dad—and the ways in which both men shaped his thoughts about money and investing. The book explodes the myth that you need to earn a high income to be rich and explains the difference between working for money and having your money work for you

What The Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!

GET RICH DAD POOR DAD

NEXT: Tomorrow, we will look at What your passion business would look like

Tomorrow, we will look at What your passion business would look like…and jump into the fun stuff. That is, setting up your entire passion business.

It’s getting more and more exciting by the counting hour.
All that will be reveal in our next session tomorrow. Make sure you do your assignment and join us tomorrow as we move forward step by step to setting up your passion business.

Ps – Don’t forget to message me whether you have any question or doubt. I will personally get back to you.

I am passionate about many things that I love to BE! DO! & HAVE.

One of my main passion is to empower and encourage individuals to overcome their fears and build up their self confident to pursue their true passion and dreams.

My mission is to help improve the financial lives of 1 million+ aspiring entrepreneurs through coaching and mentorship.

READ MY FULL BIO HERE