Money Making Online

Based on Kiyosaki’s work

Every day in the world, billion dollars are looking for a home. They are money changing hands and, in most cases, they pass from the hands of people in the left side of the cashflow quadrant (employees and self-employees) to the hands of people in the right side (business owners and investors).

Somebody could say it is not always in this way, because somebody has to pay to the employees and self-employees. But what we can also say is that when an employee is paid, usually the owner of the business where this employee is working has already earned enough money to pay for this employee and besides he has a revenue for himself by using the other people’s time. Likewise, usually when a customer pays to a self-employee, he pay money for a benefit (product or service), and this benefit is produced by investing time and effort of the self-employee: it is only an interchange of people’s assets. There are exceptions, but those are rules of the capitalist world in where we live.

We can say this: In general terms, the money flows constantly from the left side to the right side through assets like profitable businesses and the investments. On the other hand, the employees and self-employees earn the money through another type of asset: their own time and their own knowledge.

This money movement from the left side to the right side in the cashflow quadrant is observed not only in the labor or commercial world. The money also changes hands by means of a mechanism which, although is “perverse” for many people, it really constitutes the way to win the money game: the debt.

Let me ask a question: who do you think is winning the money game? The person who must pay the debt or the other one who receives the payment of the debt? The common sense tells us that usually who receives the payment of the debt should be the winner in many cases.

That doesn’t mean good debts don’t exist. If you get in debt to acquire assets by a financial scheme where the cashflow covers the monthly payments and besides it produces a revenue, the money game has two winners then: you and your creditor. When finishing paying the debt, your creditor will be happy because he made money with the interests of the debt and you will also be happy because you bought an asset by using the money of other person: your creditor.

Only a few people think seriously about this and most people make financial errors by getting bad debt: a debt to buy liabilities or things that don’t produce incomes, only expenses. Day by day we see some people getting in debts to buy a car that lose an important part of its value at the same moment when it leaves the concessionaire. And unless the car be used to generate a monthly income higher than debt payments, these people will lose some money every month while they are working harder in order to pay for something that doesn’t give any financial recompense. (Of course, many people will say it gives them status and comfort, but actually in terms of financial freedom, the status and the comfort don’t say much about the success of somebody).

The same thing happens with the houses and mortgages. People fight to pay their houses during years and they think it is their more important asset, and for that reason they pay their mortgage gladly. Although to pay for a mortgage is more preferable than to pay rent every month without receiving some financial recompense, the wrong thing is to believe that our house is an asset. An asset is really what puts money in your pocket. On the other hand, your house, the same as a car, only generates some expenses unless you rent it with an appropriate price.

The bankers understand the money game very well. The business owners often also understand it. They know if more people owe them, then they will have more possibilities to become richer.

If you want to have financial freedom, you should acquire true assets. And when you get in debts, make sure that those debts pay for your assets that, in turn, can generate you a monthly cashflow higher than the payments you must cover.

Those are the good debts. In that way you can win the “perverse” money game without being owner of a bank or a moneylender.

Tags:
Robert Kiyosaki

Some interesting links on my preferred sites and other stumbled webs:

- Darren Rowse on Problogger: In the last 48 hours some people have reported an Adsense earnings slump. Maybe it is just coincidence or maybe Google is changing something. In this moment we have only speculations.

- TechCrunch: If you can take a look here you can find a really interesting list about people who matter right now in businesses. Of course, this include, people who have created some very useful webs in the new Internet wave. Michael Arrington is one of these people. He have created TechCrunch that “is a weblog dedicated to obsessively profiling and reviewing new Internet products and companies”. A source of inspiring businesses and ideas.

- Liz Strauss on Successful Blog: Can you wait?… or you can’t wait until… Just a small reflection.

- Blog Mastermind: Yaro launch Blog Mastermind tomorrow. Then, if you need a mentor for your blogging job so you have advice about making money online, I recommend this guy.

- Taking It to the Next Level: Improving Your AdSense Performance: If you lost the last webinar (web seminar) about Adsense improvement, you can read the transcription here. It covers an overview of tips and suggestions to improve AdSense performance.

- Mahalo: A new search engine that announce itself as the world’s first human-powered search engine. A search engine for wave of the web 2.0. Very interesting.

- Kontera: is a contextual advertising network which turns keyword on web page into a link in real time. When you mouse-over the link, a tool tip layer will pop-up with relevant advertising information. Publishers get paid on a Cost-Per-Click basis.

- Video speedlinking: Jim Cramer interviews Cliff Mason on why Mason’s new personal finance column is like nothing written before:

Tags:
Internet Making Money

Nowadays, in United States you can become a juror in a justice case without leaving your home and making some bucks while you are helping to the attorneys to “pre-try” the case before it goes to trial in front of an actual jury at the courthouse. This is possible in eJury.com

This website connect the attorneys and the virtual jurors (e-Jurors) in order to do some tries regarding the cases, and it is done by publishing the facts online with questions from the attorney that the e-Jurors must check, then they answer the questions and finally render a verdict. For each verdict rendered, eJurors are paid $5 - $10 depending on the length of the case. Is not a lot of money, but extra income is good if you are interested in learning about the legal process because you are paid for learning.

The requirements to become an e-Juror are:

* Be at least 18 years of age.
* Be a citizen of the United States.
* Be of sound mind and good moral character.
* Be able to read and write.
* Have never been convicted of a felony.
* Not be under indictment or other legal accusation of misdemeanor theft or felony theft or any felony charge.
* Not be an actively practicing attorney, paralegal, or legal assistant; not be employed by or associated with an attorney or law firm.
* Not be related to a practicing attorney within the first degree by affinity (marriage) or within the second degree of consanguinity (blood).
* Not be employed as an insurance adjuster, nor associated with the adjusting of liability claims.

If you want to join yourself and become an e-Juror, please click here.

Tags:
Making Money Ideas

Based on Kiyosaki’s work

In the world of the investments, many people act in a mistaken way by conceiving the investments as a random game or as a really risky and really complicated road for the money. For that reason, the fear and the financial instruments of low profitability are common for many people who lose daily opportunities to forge a quicker road toward the financial freedom. According to Robert Kiyosaki, there are 7 levels of investors we describe in the following paragraphs.

Level 0: Those that don’t have money to invest because they spend everything that they earn or even spend more than what they earn. Half of the adult population is in this level.

Level 1: The slaves of the debts. Their few investments are corroded by a lot of “bad debts” they accumulate along their lives. They live by borrowing to the banks, family and friends. Many times they use the loans to pay other debts, and then they stay in a vicious circle. If they earn more money, they get more debts and often they like to elevate its level of life with some luxurious things but at the end of the day they don’t get assets in order to generate monthly cashflow.

Level 2: The savers. They hate the uncertainty and prefer the security without risks and for that reason they put their money in a saving account or invest in some financial products with low profitability. Often they are very frugal with the cents but at the same time, by having money growing so slowly, they are not very frugal with one of their more important assets: the time. Saving is a good idea, but if your only investment is a saving account, likely you don’t have planned to retire in your early age, and rather you plan to work until the pension age. It is a slow race.

Level 3: In this level we have those who have some basic knowledge about finances and they prefer the investments that are packed for the masses: the 401(k) plans, the mutual funds designed for the public and the most popular stocks of the moment. Here also we found “the cynicals” who read many newspapers and financial magazines and get informed by mass media; however they never take a big risk because they think to know the reason why each risky investment will be a failure. Finally, here we found the stock market gamblers who think that people who become rich simply achieve it because they are lucky and therefore they see the stock market like a random game the same as to play poker in Las Vegas.

Level 4: Long-term investors. They know the important thing is to begin early to plan their financial future and they take the control with a carefully designed plan. Although some of these investors don’t have a strong knowledge about investments, they can find some expert advisers (brokers and good firms) to choose investments that guarantee long-term earnings. Although their investments are conservative and with low risk, those are also solid and later these investments will guarantee a financial future less difficult than the one that they would have if they are only saving for their retirement. If we don’t have a strong knowledge about investments yet, but we have some small or big money surplus we should begin to invest as a investor of this level and as we improve our financial education and our experience, we can go up in our level.

Level 5: The sophisticated investors. They are the investors who have the education and the appropriate experience and, besides of that, they have the available money surplus to invest; therefore they can take enough risk for a really good recompense and often they earn high yields giving them much more money to create more assets and more investments. These investors get financial wisdom by means of the experience during many years, therefore they can minimize the investment failures and they learn to intuit if an investment has good possibilities. They take the last decisions, not their brokers, although they are surrounded by a group of good advisors.

Level 6: Capitalists. The capitalists are the true masters of the investment. They have all the characteristics of the sophisticated investors, but besides of that they are able to create the investments, so people can buy those investments. For example, they create successful businesses and later they sell shares of these businesses to the public in the stock market, and often they become vastly rich.

What level are you in? Can you identify the level of your friends or known people?

Tags:
Robert Kiyosaki

“You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.”

Have you ever abandoned a business idea because your friends or relatives thought that was a bad idea, even when the technical analysis or the market analysis showed the opposite thing? If yes, maybe you lost a good opportunity.

Something curious happens in the world of the money many times: the market trends end up contradicting what most of people think it will happen. And, for that reason, the rich people get richer, the poor people get poorer and middle class people end up fighting eternally with the debts. The popular wisdom doesn’t work very well in the world of the money, and for that reason 10% of people have 90% of the money.

This doesn’t mean we should only value our convictions. At the moment of creating a business or making an investment it is good if we ask the opinion of the other people. The problem is when many times we ask for opinion from people even less successful than us or people that doesn’t have knowledge about the world of the money: employees who spend everything what they earn, or our brother who are more interested in cars than money, or the supermarket guy who buys lottery every week hoping to win.

The common sense should tell us that if we need an advice on some topic, we need a person who has or have had success on that topic. Therefore, if you plan to create a business ask for the opinion from some successful business owners. Or if you plan to make an investment, ask for the opinion from people who really make money with their investments.

We should not discard the opinions of who don’t have the experience or the appropriate knowledge, because any person could have some great ideas by seeing the things from a more objective point of view. But we should assign the appropriate weight to the opinions of the other people according to their personalities and actions with regard to the money, specially when we have made our own analysis with numeric data or investigations about trends of the market.

When do you think that there are better opportunities to make money in a business?:

1. When there is an unsatisfied demand in the market and the offer is little or nonexistent (or)
2. When the offer is huge and people see this as the business of the moment

Usually more money could be made in the first situation. However, in that point, most of people will not notice that could be a good business. A visionary entrepreneur will take advantage of that.

When do you think that there are best opportunities in order to invest in the stock market?:

1. When the market is weak and people sell their stocks with low prices (or)
2. When there is euphoria in the market and many people invest in high-priced stocks, including people without financial education.

Logically the good investors take advantage of the opportunities when the stocks are cheap. For that reason, sometimes the good investors seems operating contrary to the market.

In the world of the business and the investments, it is much better to ask for opinions of the crowd to discover trends or necessities instead of using these opinions to know if we will have financial success. If the crowd knew enough about businesses or investments, then they would have enough money. And you know that is not true.

Remember: “You are neither right nor wrong because the crowd disagrees with you. You are right because your data and reasoning are right.”

Tags:
Internet Making Money