Rich Dad’s Cashflow Quadrant Review

Short Profile

Title: Rich Dad’s Cashflow Quadrant
Author: Robert Kiyosaki
Year:  First published: 1998; New edition published: 03/2012
Length: 376 pages
Genre: Business, Personal Finance, Self-help
Short Description: Achieving financial freedom is something we all must strive for. In this book, Robert Kiyosaki teaches us how to gain control over our lives, financially.
Get a copy: 1) Search in local bookstores to support small business 2) Amazon


Rich Dad Cashflow Quadrant is the second book of the series Rich Dad, Poor Dad. Robert Kiyosaki continues to share the lessons he learned from both of his dads.

The author focuses on changing the way you think about money. Open our eyes to various possibilities. Explain the wealth building process, reveals the strategies necessary for moving beyond just job security to greater financial security by generating wealth from four selective financial quadrants.

The book is a must-read for every self-respecting person.

My Opinion

Kiyosaki emphasis on the significance of financial intelligence and how important it is to be well informed in order to have a better financial life.

We often hear people saying that you don’t need money to be happy. I believe I once said it too. Although this is entirely true, everyone needs some kind of financial independence. For some, this may mean $1,000,000 per year, for others, just $50 per day. But claiming that you need money at all is absurd.

Anyone who claims that money doesn’t matter, apparently didn’t stay long without them.” Robert Kiyosaki

Rich Dad Cashflow Quadrant extends the philosophy first shared in Rich Dad, Poor Dad book. This time the focus is on the four main cash flows, which we people use, to earn money:

On the left side of the quadrant we have (average income):

  • E: Employees – Most of us are employees. Employees value the idea of financial security over the risk of financial freedom.
  • S: Self-Employed – Most small businesses are owned by the self-employed. With the growth of their business, their involvement also increases.

And on the right side are (where the real money lies):

  • B: Business-Owners – These people focus on creating a system that will potentially work without them being physically there.
  • I: Investors – Investors make their money work for them. At that stage of life, you become financially independent.

I encourage you to read the book. It will surely give you a lot to think about.

The downside: too much propaganda about his cashflow game and the other books from the series.

Key Takeaways:

Here are some of the most insightful things I would really like to remember from this book:

Schools Produce Workers

It’s harsh but it’s true.

What we are taught in schools is long obsolete. In the beginning of your school career, so to speak, the idea makes sense. We learn basic things like writing, maths, history, geography even sports. These subjects help us understand the world around, improve our communication skills, develop our minds so we can think faster and better. After that, the purpose of the school becomes rather trivial. It’s like a huge assembly line, which aims to produce new accountants, analytics, doctors, salesman, office workers, construction workers, people working from 9 to 5. All things that will lead to an average lifestyle.

“You must find a stable job” – is what our parents were constantly repeating us since we started first grade. But they are not to blame. They taught us to think this way only because they were taught the same thing: go to school, get a job, get a home, work, don’t ask questions or you may lose everything. Back in the days, this kind of life was ok. There weren’t many opportunities. At least, not so broadly available. Now, things are quite different. You can do pretty much everything from the comfort of your own home: work, learn, teach, build your own business.

Higher education is important for the traditional professions, but not for earning great wealth.

Renting or Owning

Do you work for someone or are you building a business?

Your 9 to 5 job is a temporary thing. No matter how safe you feel at your workplace or how many years you’ve been with the company, any moment might be your last.  Your career, coworkers, title, salary can all become things of the past. Even at this very moment, while you read this article, your boss might call you into his office and fire your ass. That’s what happens if you read things from the net instead of writing emails.

The variants are countless: hurricane may destroy the whole building, you might slip and fall over the boss’s daughter, sleep with a colleague, layoffs may be required. If the job you currently have is your one only income stream, you will be in a very uncomfortable situation if you lose it. Like sleeping on the street.

On the other hand, we have the opportunity to build our own business. Something we own. Based on our interests and strengths. If you build a business, you’re no longer renting a job. You own that shit. The daily duties feel kind of different, kind of “I am my own boss”.

The main advantage of owning a business is the potential for growth. Surpassing your wildest dreams is fully possible. Yes, it will take a lot of sweat and tears but at the end, you can create something that will outlive you and help the humanity. Well, probably this won’t be the case with most of us – business owners – but at least it’s a great motivator.

Reaching success in either one requires a lot of work – renting a job or owning a business. Both have positive and negative sides. Still, owning a business is like owning a home – you take extra care of it and it’s something that will be inherited from your kids.

Bottom line: are you going to leave something behind or your ambitions will die with you?

It’s not important what you do now. What you want to become in a few years is important

Let me elaborate a bit:

Obviously, your daily actions matter. If you snort cocaine on daily basis you will most probably suck dicks for a dollar within a couple of years. What caught my attention, in the book, is the following concept: you may have to accept doing a shitty work or working for a shitty boss for some time of your life. While you do that, you plan, execute and strive to achieve something bigger. You have to have a plan, which you strictly follow.

People are looking for instant success. Feel the money between their fingers, inside their pockets now, not later, not in few years, now. This is even more exaggerated now when we can order basically everything online.

All kind of businesses are started daily: “I will create the new Facebook”; “I will serve the best coffee in town”; “I will offer unique soap that will keep your hands clean throughout the whole day”. In the beginning, everything seems so easy and fun. However, the reality train soon strikes. It carries the truth. It people that success comes after years of working. Sometimes, even decades. After acknowledging that, things are quite different. You’re no longer mister smiley pants and all that initial enthusiasm is out of the window.

I’ve attended several seminars with world-famous lectors. There’s always someone who asks the speaker how long does it took him to become really successful at his craft. The answer? Bitter. It’s always more than 10 years. At that moment, the fire inside the eyes of many vanishes.

Wealth is measured in time, not in dollars

No matter how much money you have in your pocket, under the bed or saved in the bank, if you are constantly working, piling up those extra hours, then, you are poorer than a hired worker. Your job enslaved you.

Wealth is measured in time, not in dollars. If you don’t have enough time to enjoy your wealth, then you have a serious issue. Kiyosaki shares a very simple way to determine how much freedom you currently have:

If your monthly expenses are $ 1,000 and your savings are approximately $ 3,000, you are financially independent for 3 months.”

In other words, if you quit your job now, you can afford to live 3 months without having to work. Of course, this is an approximate measure. Eventually, you might lower your expenses to 500$ a month and live one extra month. The point is, if you really like to be successful you must determine how much money you wish you gain per month, save per month so you can live a worry-free life at a certain moment. Ultimately, it doesn’t matter how much you earn, but how much you save and for how long the money you have will work.


Being rich has its downsides. It becomes addictive. You may lose sign of your expenses and end up begging street prostitute for a smoke. There are actually a lot of people who reached the top and only after few years, or less, crashed all the way down to the bottom of the food chain. Such people, the society calls spenders. The amount of money they gain is immediately spent for shoes, Louis bags, bigger houses, more cars. Essentially, to maintain a high standard of living.

Mike Tyson is the perfect example. He is basically financial ignorant. Tyson declared bankruptcy in 2003, despite having received over $30 million for several of his fights and $300 million in total during his career. He retired from professional boxing in 2006 and at the time it was reported that he had approximately $23 million of debt. *The detailed information is acquired from here – link.

Since then, you probably saw him appear in all kind of shitty movies, promote all kind of low-quality products. H had to. If he wanted to eat. Not to be rich, basically to survive.

The only way to be truly rich is to make your money work for you – to invest. Тhere are several ways. Most popular ways are acquiring stocks, invest in some kind of new and radical idea, last but not least, in yourself.

Your most valuable asset is yourself and how you spend your time.

The only difference between a poor man and a rich man is what they do in their spare time. ” Rich Dad

Get A Copy:

  • Local Bookstore: Search in a near, local bookstore to support small business.
  • Amazon
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