Money Making Online

Based on Kiyosaki’s work

You can see the disappointments as mental assets or mental liabilities for your life. Most people transform them into a mental long-term liability.

Usually, people transform their disappointment into a permanent failure by saying things like “I will never attempt to do that again”, although in many cases, they are doing something for the first time. Due to the mentality that they learned in childhood, most people think the failures are bad situations that should be avoided, instead of life lessons to learn by making mistakes. In this way, people transform the disappointment into a mental long-term liability.

On the other hand, if you learn something when you fail and are ready to try again, but this time avoiding the same mistakes that you detected already, your chance of achieving the financial success is now bigger, although that doesn’t mean you won’t fail again. In this way, we transform our failures into mental assets.

Expect to be disappointed: It is not about having loser’s mentality, but if you get ready emotionally for disappointment, then you will be able to face it in a positive way, instead of only complaining about life. You need optimistic thinking and, as established by the Law Of Attraction, to be surrounded by attitudes and thoughts that attract success. But you should get ready emotionally in case you fail temporarily.

Have a mentor standing by: tell your plan to people who you can consider as your mentors, or people who is where you want to be: successful business owners and rich investors. When you have difficulties, you will be able to call them and listen to their wise advice.

Be kind to yourself: If you fail temporarily, don’t become bitter by thinking bad things about yourself. If you punish yourself very hard, then the chances for learning valuable lessons for life will be wasted.

Tell the truth: Nowadays, we can hear a lot of things about the emotional intelligence. And this intelligence has to do a lot with how people face the difficult situations, without trying to hide the truth by lying or using false appearances. Face the reality and always tell the truth even if that is really difficult. That way, you will place your feet on the earth, will learn much more and some bigger problems will be avoided.

Make mistakes: Don’t be afraid of making them. If you don’t make mistakes, then you won’t learn. Think about all things you have learned: walking, riding a bike or your profession. At the beginning, you made many mistakes. But today, you would not make those mistakes because you learned the lessons.

Put a little money down: if you don’t begin to invest small amounts you can lose without a lot of drama, then you could not learn anything about the investment world. And, if you lose those small amounts of money, compare what you learned versus the lost money. Usually, what you learned is much more valuable.

TAKE ACTION!: it is important to read, observe and listen. But if you don’t take action, you will never arrive anywhere. Just do it!

Tags:Robert Kiyosaki

Based on Kiyosaki’s work

Personally, this point has been a difficult step for me in the search for financial freedom. Having a true mentor who is successful in the business and investment world, can be difficult in a society where most people have a financial fight to stay afloat.

It evidences that most people are caught up in what Robert Kiyosaki and other authors call “the rat race”. Many of them are afraid of losing employment because they depend on it to survive. Other people are simply caught up in a debt trap. And other people consider themselves as business owners, when they are self-employees who fight to stay afloat, month by month, without a long-term vision. Finally, other people believe they are investors getting really low yields or betting and praying so the stock market doesn’t crash.

So far, I have decided that my mentor is Robert Kiyosaki although I don’t know him personally. Through his books, I try to know him and enter into his mind in order to learn everything I can from him. At the same time, I read about the biographies of businessmen and investors such as Henry Ford, Rockefeller, J.P. Morgan, Walt Disney, Bill Gates, Donald Trump, etc.

Although it is not the ideal way, at least it is better than having bad mentors. Sometimes, people ask advice from a person who is in the same situation or worse: relatives who are only employees with no experience in business, stock brokers who get a wage even if you lose money, small business owners who are close to bankruptcy, financial journalists who are known as experts when they are only employees of a media company, or friends who are interested in wasting time and spend money on useless things.

Someday, I hope to find my own mentor, personally. But without a doubt, I will choose that person carefully.

Most people are not aware of seeking a mentor, and they try to be successful by trusting their own financial knowledge. That is not bad at all. The problem is that almost all people come from an educational system that teaches us to be employees or self-employees and those people don’t have enough knowledge about the money. So, if we don’t invest time in the financial education first, our plans will be quite risky.

Another important aspect is the environment that surrounds us: the people who are surrounding us most of the time. If we don’t create a favorable atmosphere, our destiny will be similar to the destiny of trees planted in a bad soil.

Kiyosaki proposes an exercise:

1 - Write down in a piece of paper the names of 6 people who surround you most of the time.

2 - Write down next to each person, from what quadrant the money come for this person in a major proportion: Employee, Self-employed, Business Owner or Investor.

3 - Write down what kind of investor each person is, according to the classification of the “seven levels of investors“.

4 - Now, write down what quadrant you are in (at this time) and what quadrant you would like to be in.

5 - If most people in your list are in the quadrant you would like to be in, then you have a great chance of achieving your goals.

Question: Do you need to make changes in your daily environment and relationships? Have you identified a mentor yet?

Tags:
Robert Kiyosaki

Based on Kiyosaki’s work

According to Robert Kiyosaki, there is an additional classification for the types of investors related to a specific investment or business: A, B, and C.

The type C investors are those people who simply don’t understand the investment or business and sometimes even they are not interested in learning.

When a poor person is a type C investor for all investments and businesses, the options to get rich are: get a job with the Government, marry someone rich, or win the lottery (or maybe inherit a fortune).

The type B investors are those people who have a very basic knowledge about the investment or business but, anyway, they are always supported by financial advisers. They always are looking for the answers they need in order to achieve good financial results.

When people are not really interested in the numbers or financial control, the best thing that they can do is to be surrounded by the best financial advisers. The problem here is that it is very difficult to identify the good advisors if you have no enough knowledge about the investment or business.

Many people that invest in stock market are type B investors and although, in few cases, they can achieve good yields by giving their money to the advisers, most of the times these people are only average investors that become happy when the market go up but they get scared when the market go down. In general, these types of investors cannot make money in a specific market going down, due to their lack of knowledge.

The type A investors are those who look for problems in the investment or business and develop solutions to them. They see these problems as opportunities to earn excellent financial returns.

The differentiating factors of the type A investors are the knowledge and the financial education. These people have solid financial bases and besides that, they have had positive and negative experiences that make them sophisticated enough to invest and manage their money.

Nobody can know everything. Therefore, depending on the field, we can be type A, B or C investors. We can be all the types of investors at the same time, depending on the investment or business type. If you want to become a great investor, then you only need a field where you can become a type A investor. In all the other ones, the financial advisers could help you (you are a type B investor) or simply you can ignore them because they are not your specialty (you are a type C investor) although the necessary condition is you are always willing to learn and expand your context.

Tags:
Robert Kiyosaki

Based on Kiyosaki’s work

There is an incongruous thing in a lot of people’s lives: they think that the world of investments is risky because they can lose money, but at the same time they cling to the security of an employment by thinking that their bosses, the companies or the Government will always look after their well-being, as if that was not really risky.

Putting our financial future in a third party’s hands is really risky. Making investments to acquire assets is not necessarily risky. Of course, provided the investments we make are acquiring assets. And previously, we have defined the assets as those investments that put money in your pocket every month. Why should be risky something that puts money in your pocket every month?

Another thing is the risk. Logically, the investments have an associated level of risk. There are not completely safe investments, but that is only a technical aspect and the smart investors are conscious of this. However, the smart investors make the investments although those have risk because at the end of the day the investments are not risky for them, and that is because their financial intelligence is enough to have a great chance to make money.

The point is: in investment world, risk is not the same as something risky. The risk is an implicit technical factor on the investment market and it is the same for all people who make the investment. On the other hand, the risky thing is not the investment itself, the risky thing, in most cases, is the investor who doesn’t have enough education, experience or cash flow.

Therefore, to reduce the risky situations, we don’t need to avoid the risk of the investments… what we should do is to get ready, increase our financial education and go step by step into the investment world to acquire experience.

Of course, sometimes we’ll lose money, but eventually, due to our financial education we will win more than we lose. And when that happens, we will begin to manage an interesting cash flow and we won’t need to think about RISKY investments anymore, although the investment RISK will always be a factor in the investment evaluation.

Again, remember: risk is not the same thing as risky.

Acquiring assets is not risky. The risky thing is the lack of financial education. The risky thing is don’t have enough control over our life by trusting blindly in stock brokers, the economy, the politicians or the labor market.

The biggest risk is ignorance. And it applies to all matters, not only for the finances and investments.

If you don’t know much about the world of finances and investments, start to reduce the ignorance by acquiring financial education. As your financial IQ increases you will realize those financial threats were excuses for your ignorance.

Tags:
Robert Kiyosaki

Based on Kiyosaki’s work

Most people think their financial problems will be solved, when they can make more money. The truth is that in many cases the only thing they achieve is an increase of their money problems, because they end up getting in debt again and every time with bigger debts. They have a mental illusion, when they consider that by making more money, will be able to assume debt without any inconvenience.

Unless the acquired debts are “good debts” which somebody else ends up paying (for example, a house for rent where the tenant pays the mortgage), the debts don’t let people advance. Actually, debt makes people live under constant financial pressure while it ends up, in some cases, producing discouragement and depression.

It doesn’t matter if you earn $300 or $3,000,000 per month. You should learn how to control your cash flow. Many times, that includes to overcome the social pressure produced by a consumption society bombarded constantly with ads that encourage people to buy things or knick-knacks producing only a momentary satisfaction and no long-term advantage.

There are some tips here:

1. Eliminate your credit cards, except one. You doesn’t need more than one credit card. One is enough. From now on, if you make any purchase by using your credit card, it should be entirely paid on the next payment, not in several months.

2. Think about how you can earn or save $150 or $200 extra a month. It is not so difficult if you are decided. Almost any person can either earn or save that amount of money. If you make a budget of your expenses, you could be surprised for all money you spend on useless things.

3. Take the extra $150 or $200 and increase your credit card payment. Now you will be paying the minimum payment + $150 (or $200).

4. Once you finish paying off your credit card, continue with other consumption debt, by adding the extra $150 or $200 to the monthly payment that you usually have to pay. The other debt can be another credit card, appliances debt or any thing different to your house or car.

5. Once you have paid all the consumption debts, transfer those additional funds to your mortgage or your car payment.

6. When you are debt free, take the additional funds and put them in a bank account or fixed-income securities (low risk). Put the money there month after month. This money won’t be spent until you find assets that generate positive cash flow per month.

Tags:
Robert Kiyosaki