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- Understand the difference between an Asset and Liability. Assets bring cash and Liabilities drain cash. Assets are rental property, stocks, businesses etc. Liabilities are homes (bigger than what one needs), flashy cars, expensive gadgets, furniture etc
- The poor people have jobs that give income which goes out as expenses, the middle class get income above average from the job and they spend to purchase Liabilities, the rich get income from job and their assets and they use the same to purchase more assets.
- The goal is to increase the assets column so we no longer trade our time 9 to 5 daily for our income. The assets produce the income passively for us. This is money working for us.
- The poor work for money and the rich make money work for them.
- The rich own corporations through which they pay expenses pre tax, so they earn, spend and then pay taxes. Others earn from their jobs, pay taxes and then spend. Note the difference in the sequence.
- It’s very important to gain financial IQ. we have been raised to study a profession and use it to earn money. But we never understood finance. Invest in learning finance. Understand the system, that is all the game is about.
- Opportunities are right in front of our eyes but we have to be intelligent enough to see them and have the courage to grab them.
- Do not just sleepwalk through life, but have goals.
- Study well, get good grades, get a safe job is no longer true, we notice the people who made big are college dropouts who dreamed big and made it happen.
- Sales and marketing skills are more important than raw talent. Invest in learning these skills.
