By Louis Lim, Business Correspondent

In view of the current economic difficulties facing many, people ought to be more ware of what’s happening in the world and how what’s happening can adversely affect their financial securities and lives; if it has not done so already!

It is not a well known secret that one can avoid being a financial casualty by simply acquiring a set of skills different from what we are usually programmed from young to have. The latter has to do with being enslaved to a job or business controlled by others; the other being about having skills to generate an income independent of any circumstance or other people.

Anyone depending solely on a job for a living would be almost completely lost if he loses his job. The unfortunate fact is that since the Multi-Nationals Companies began institutionalizing the treatment of employees as just another business resource, albeit commodity, the age of life-long employment seizes.

Financial results associated with satisfying shareholders’ expectations became the main reason for a business enterprise. Coupled with the practice of achieving short term objectives and the need to maintain share prices, retrenching workers became a normal business practice. Words like ‘downsizing’ and ‘business rationalizing’ became common business parlance.

This dehumanizing of business enterprises, prevalent throughout 18th and 19th century industrializing Britain was revived and practice by American businesses. The new reality in a capitalist environment anywhere means a worker is subject to his job being taken away any day. More importantly, this means also that the individual worker must realize quickly the insecurity of a job.

What then is a worker to do to secure himself? Off course there are skills like being a doctor or dentist and others which are not down sizable. However, most workers are dispensable!

Men are, however, born with an innate creativity which can be described as entrepreneurial but this has historically been replaced by skills which are intended for us to work for someone else. The result is that only the top five per cent or so of employees can acquire financially independence (with high salaries) while the rest remained dependent and vulnerable all their lives.

To acquire these forgotten skills would require a change in mindset from one of being a worker (a worker’s mindset) to that of being a boss (an entrepreneurial mindset). The latter entails having a ‘Possibilities Mindset” which would enable one to know how to garner resources and knowledge and, to apply them to secure one’s own financial objectives.

Henry Ford, the car genius, once said that ‘money is not a man’s security; he is his own security’. What he meant was that a man’s security lies in his knowledge and skills. However, if your skill and knowledge is tied to working for someone then those skills and knowledge can be replaced any time.

However, Henry Ford is not wrong; if a man’s skills and knowledge is in the area of creating a money making enterprise. Robert Kiyosaki, a very successful entrepreneur, said that ‘every man must mind his own business’. He didn’t express it too well but what he meant is that ‘to have financial security a person must learn to develop his own money making business’. Is this possible? Every man? In my opinion, in today’ new reality, any worker who wants financial security has no other option!

Off course, whenever an uninitiated thinks of starting a business he thinks of big capital, connections, special knowledge and skills. For a man who has little money and has just lost his job, it’s even more unrealistic to think of starting his own business. However, many have done it, albeit, at great odds.

But what if you are not retrenched yet? And you have some time to learn. Could you invest in a money-making skill that can provide an alternative income? Could you learn to be an entrepreneur with little resources and connections?

The answer is yes but you have to adopt an entrepreneur mind-set; which really means that you to start believing in possibilities! Remember that when Bill Gates and Steve Jobs started their little enterprises in garages all they had mainly were their belief in possibilities. The amazing fact is that because of them the possibilities have increased exponentially with the advent of the internet.

Besides a strong belief in possibilities, an entrepreneur is one who learns to gather resources, knowledge and skills and organize them into money making processes. In most conventional businesses, this is usually a huge ask for any newcomer. Fortunately,, there are now other avenues where starting a business is made more possible for any one with little money and is prepared to spend time learning.

For example, the internet has made it easier to start your own business. The main thing you would need is a good PC, some affordable money, a willingness to learn and a lot of belief in yourself. What is to be learned is seldom difficult; a man’s limitation to success is often his own lack of self-belief!

If your motivation is create a secure financial situation for you and your loved ones, you need to be an entrepreneur. The days of secure employment is long over and moreover, personal wealth is seldom acquired by working for others.

See original here:
Entrepreneurship – A Panacea For Job Insecurity?

1. Simplify and get out of the rat race faster
I noticed that whenever I played the cashflow 101 game and was able to choose a “simple” profession like a truck driver for example, I was able to get out of the rat race faster. 

As a truck driver, although my salary was low, my monthly expenses were also very low. Because I had  low monthly expenses, I already had a positive cashflow and all I needed to do was just get those passive income generating deals.

After each payday, I had more money to invest, and with just a few passive income generating deals, I had enough passive income that exceeded my monthly expenses, and I was able to get out of the rat race faster.

In real life, I am applying the same strategy by reducing my monthly expenses by leading a simple life. This was also described by Bo Sanchez in his book “Simplify and Live the Good Life ” and T. Harv Eker in his book “Secrets of the Millionaire Mind”.

My family and I lead simple lives, which explains my very low target monthlypassive income which is why I know I am going to get out of the rat race in real life very soon!

2. Start with small deals first, and the big deals will follow
In the beginning of the game, I always chose small deals even if they produced little cashflow. Later on, when the market presents good opportunities, I was able to sell or “flip” these small deals and then I used the profit to buy the bigger deals that produced greater cashflow, allowing me to get out of the rat race.

In real life, I am also following the same path. I focus on single family homes or properties which may produce little cashflow at  the very least, but can actually generate significant profits if “flipped” or sold through “rent-to-own”. I can then use the profit later when they are enough to get bigger deals that can produce bigger positive cashflow.

3. Over-leverage often leads to bankruptcy
During the game, we often encounter great deals that produce a lot of positive cashflow but require a big downpayment and it is tempting to borrow money from the bank just to be able to buy those great deals. However, there is such a thing as becoming over-leveraged which can produce negative cashflow situations because of the high monthly payments for those loans.

Even if one’spassive income is enough to cover the monthly payments for those loans, imagine if something happened and the monthly income of one’s investment properties were affected, suddenly the monthly payments for the loans cause a negative cashflow and can lead to bankruptcy. The same can also happen when one is downsized. This is the reason why one should avoid deals that lead to too much exposure or over-leverage.

Applying this is real life is a no brainer. I would not dare buy those multi-unit apartments unless they were in the same price range as the single family homes I focus on. As mentioned in lesson number 2 above, I can go for those bigger deals later when profits from my small deals are enough.

4. It is better to wait for a good opportunity than settle for those not so good deals
In the game, good opportunities come in the form of deals that have big ROI potential, and can be bought with little or no downpayment, while producing positive cashflow. If any of these elements are missing, I consider a deal as “not so good” and I pass them up and just wait for the good deals.

In real life, I do the same and patiently wait for good opportunities. If a not so good deal comes my way, I can either look for ways to make it into a good deal, or I just pass it up and wait for another more worthwhile deal to pursue.

5. Learn how to spot a good deal and grab it
One of the biggest challenges one faces in the game is how to spot those good deals so that you can grab them. Sometimes a good deal is right under your nose and it slips away because you didn’t realize soon enough that it was a good deal.

I believe spotting good deals is a skill and you can only learn this skill by continuously analyzing deals. Once you get the hang of it, you will start seeing those good deals more often. Normally those deals would have normally slipped away without you knowing it. If you see good deals often, it’s just logical that you will eventually grab one of those deals right?!

6. Learn how to protect your investments
I distinctly remember games where apartment buildings getting toppled by mud and all the cashflow generated by these properties are gone, unless I am covered by insurance.

Does Ondoy and Pepeng ring a bell? Who would have thought that a game like cashflow 101 actually teaches us to protect our investments from such disasters and calamities. Better get your investments insured with “Acts of God” coverage pronto!

7. Net worth is worth less, cashflow is king
Once you play cashflow 101, you will notice its emphasis on the importance of cashflow over one’s net worth. You will see that it really is more important to have positive cashflow frompassive income. What is the use of having a big net worth if you don’t have any positive cashflow?

In real life, we should apply this by focusing on building our positive cashflow with income generating assets. Even if we have to use leverage to buy these assets, it really is okay. We call this good debt. Don’t be afraid to have good debts that buy real assets that produce the cashflow we need to get out of the rat race for real!

Get out of the rat race in the game, and in real life!

So you got out of the rat race when you played cashflow 101. So what?! That’s useless if you don’t take action and apply the lessons you have learned from the game in real life. But playing a game is one thing, doing it in real life is an entirely different thing… or is it?

I can truly say that Robert Kiyosaki’s Cashflow 101 game is a “life changing” game because my life has really changed ever since I decided to apply in real life the lessons I have learned from it. Take note that I only listed the top 7 lessons I have learned and I can assure all of you that there are more lessons one can learn from this game.

People may find it hard to believe that one can learn so much from a game and can have such a huge impact in life. I guess you just have to play the game and experience it for yourselves.

How about you, have you played Rich Dad’s cashflow 101 game? What did you learn? Are you applying them in real life?

View post:
Top 7 lessons I learned from playing Rich Dad’s Cashflow 101 game

In my pursuit for further educating myself when it comes to achieving financial freedom, I enrolled myself in a free online coaching in the Rich Dad Poor Dad lessons of Robert Kiyosaki.

In one of the chapters of the e-learning that I’ve been reading, Robert Kiyosaki suggested the Rich Dads Get Rich Strategies in which he used to get out of the rat race and become a business owner and investor.

I would like to share it all to you my readers so we can also use it to achieve financial freedom just like what Robert Kiyosaki did:

STRATEGY 1: Become financially literate.

The number 1 strategy to get rich is to become financially literate. Financial literacy is not always taught in schools. It requires proficiency in several areas: economic history, accounting, taxes, investing and building businesses. These are difficult subjects but don’t let the difficulty scare you.

Becoming financially literate has nothing to do with how far you got in school. It doesn’t matter whether you’re a failure in school, a jeepney driver, a janitor, or an executive of the company. What matters most is that you’re willing to educate yourself.

One of the things that I learned about financial literacy is on cash flow patterns. Based on these cashflow patterns, you would be able to determine if you belong to poor, middle class or rich persons.

Kiyosaki compared people with average financial intelligence vs. people with advanced financial intelligence:

People with average financial intelligence know only:

• Bad debt, which is they try to pay it off.
• Bad losses, which is why they think losing money is bad.
• Bad expenses, which is why they hate paying bills.
• Taxes they pay, which is why they say that taxes are unfair.
• Climbing the corporate ladder instead of owning the ladder.
• Buying shares of a company rather than selling shares of a company they own
• Investing only in mutual funds or picking only blue-chip stocks

People with advanced financial intelligence know the difference between:

• Good debt and bad debt
• Good losses and bad losses
• Good expenses and bad expenses
• Tax payments and tax incentives
• Corporations you work for and corporations you own
• How to build a business, how to fix a business, and how to take a business public
• The advantages and disadvantages of various investment vehicles: paper securities, real estate properties, and businesses

STRATEGY 2: Work to Learn

Most people focus on working for pay that rewards them in the short term; over the long term, this strategy can be disastrous because it doesn’t build up enough assets for a stress-free retirement. You’re not sure if your employer will be there for the next 10 years. What if you were laid off? Or what if the company closed?

If you want to be financially free, you need to seek work for what you’ll learn, not for what you’ll earn. This is one of the main reasons why I left my previous company. With my tasks, I am no longer learning and in that way, I feel rusty. It’s not always the pay that matters. It’s the satisfaction and the amount of learning that you get. The skills you learn when you work for someone else can be invaluable when you begin to work for yourself—and if you want to be financially free, you’ll have to work for yourself.

Kiyosaki said that there are three essential skills that we need to learn from our job while we are working for somebody else. These are Leadership, Management, and Sales & Marketing.

STRATEGY 3: Find Mentors, Build a Team

They say that no man is an island and that two heads are better than one. The same applies when you want to get rich and achieve financial freedom. You need to seek out mentors and advisors who can teach you the valuable skills you’ll need to become a business owner and investor. No one climbs Mount Everest alone, and you shouldn’t try to climb your personal financial mountain without the aid of others. Without support, you’ll never reach the top.

Kiyosaki said that “business is a team sport.” One thing is certain: When you want to get rich, you need to set out to work for yourself. In doing so, you’ll need more than just friends and family—you’ll need a team of professional advisors. According to Kiyosaki, one secret of the rich is their humility. They surround themselves with people who know more than they do. They surround themselves with experts.

STRATEGY 4: Work For Yourself

Kiyosaki said that most people work first for the owners of the companies that employ them, then for the government through taxes, and finally for the banks that own their mortgages. No wonder they have little left at the end of their working days! To escape the rat race, you need to work for yourself.
You should think like Rich Dad. Instead of saying, “but the odds of a start-up succeeding are against me—nine out of ten companies fail within five years,” say to yourself, “one out of every ten businesses succeeds within five years, and mine will be one!”

STRATEGY 5: Create Money

Kiyosaki said that “Money isn’t real. It’s just an idea!” Today, we are now living in the information age. The information age allows some individuals to get ridiculously rich from nothing more than ideas and agreements. There are people who makes a lot of money in the internet either by maintaining a website or by trading stocks and forex online. Today, it’s not at all out of the ordinary for millions to be made instantaneously out of nothing.

How do you create money?

Finding an opportunity that everyone else has missed.

Learning how to raise money through investments and assets.

Working with knowledgeable people to help you reach your financial goals.

STRATEGY 6: Give Back

Kiyosaki believe on charitable giving. Personally, I also believe on the universal law of nature and that’s Karma: “Do unto others what you want others to do unto you.”

Also, we should not forget Newton’s Law that states: “For every action, there’s an equal reaction.” If you’re a greedy Scrooge, people will respond to you in kind. You have to give money to get it back. Remember, give and you shall receive.

The rest is here:
6 Strategies To Get Rich

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Ramit Sethi, Author of I Will Teach You to Be Rich was interviewed by certified financial planner, Cathy Curtis at the Commonwealth Club of California event.

Ramit talked about his book and some of his philosophies on personal finance management.  I recorded the interview and wanted to share a few snippets from the discussion about his “Bulletproof Personal-Finance System”.

Watch the video and share in the comments your thoughts about his system. Have you tried it? Do you think it works? If not, why?

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