Making Money And The Cash Flow Quadrant
I’ve learned that if an individual aim is to get financially
independent, you’re going to definitely have to take part in
either, both or all three of “residual, portfolio, or passive” income.
Because look at it this way, it’s this simple. We live in a world
where you are one out of four individuals (or multiple simultaneously).
I don't know if you have heard of what's called, "The Cash Flow Quadrant".
Every business owner should know about this basic model. This is one of
the very first things I've learned in my financial studies. It is very
important to understand how this model is structured.
E (Employee) - S (Self-Employed) - B (Business Owner) - I (Investor)
1. Are you Employed?
(This is where you work for someone else as earned income. You are
working a J.O.B. (just over broke). Getting a paycheck on a regular
basis due from your hard work or labor. This is where the HIGHEST
taxes are being paid. This is the very last position you want to be
in even though the majority of Americans suffer from this.)
2. Are you Self-Employed?
(This is where you own a job. If you don’t work, you don’t get paid.
If you leave, then your business goes with you. This is still earned
income except you "literally" work for yourself. Examples: Accountants,
lawyers, doctors, etc....)
3. Are you a Business Owner?
(This is where you own a business and people (or money) work for you.
You use their work as leverage for your gain. Being a business owner,
your getting more towards portfolio, residual, and/or passive income.
This is where most “rich” people are.)
4. Or are you an Investor?
(This is where residual/passive/portfolio income is at its finest!
This is where your money REALLY works for you! This is where most
“wealthy” people reside. This is the ultimate place you want to be!)
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