Robert Kiyosaki Blog

Financial Education Portal inspired by Robert Kiyosaki

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Cashflow game – lessons learnt

If you think playing the Cashflow game is just like playing another silly round of Monoploy, then you need to seriously think again.  Cashflow boardgame is not just like a game, it is a educational tool for you to sharpen your finanical acumen and you get to learn different lessons each time you play the game.   The author of Rat Race Escapes (ratraceescapes.com) shares his learnings from his recently cashflow game: Sue, Bob, Terry and I played Cashflow 101. I played the teacher. Because the monthly cash flow is lower than occupations I normally play, it was much longer before I started taking big deals. Things moved pretty slowly for me for quite some time, buying 400 shares of MYT4U at a reasonable price of $10, even though I immediately landed on charity and in my next 3 roles I had for paychecks. Shortly thereafter, I partnered with Bob and Sue on a limited partnership with a doctor’s office and then immediately I was downsized. Things were looking great when I bought a “great deal” for $35,000, a government owned home with a tenant, for $2000 down and $220 per month cash flow. Just before my next turn, a buyer appeared and I sold the house for $135,000, putting $102,000 in my pocket. I paid my bank loan plus my credit card and retail debt and still had $90,000 in cash! On my next turn I drew a Big Deal and it was the 60 unit apartment building. Perhaps I should have passed on it. It was initially a net neutral deal for my monthly cash flow: with a down payment of $200,000, I borrowed $110,000 to make up the difference in the cash I had on hand but the $11,000 in monthly cash flow covered the loan. I still had a decent monthly cash flow of about $1600. Had I passed and taken a different big deal on a subsequent turn, I’d have retained cash, increased my cash flow and I may or may not have exited the Rat Race sooner. After a couple more turns, and starting a software company in my basement, received a paycheck and borrowing more money from the bank, I got laid off again. My cash flow shrank to less than $100 and on a subsequent turn to about -$300. I survived and then sold the limited partnership, double the money for myself and partners and then sold the MYT4U stock for $40 after a split. After paying debt down, I was back to good cash flow and still had cash. In the mean time, Bob exited the Rat Race getting $600,000 as his initial Cash Flow Day. Bingo, now there was a...

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Background story about buying Silver

Few days ago a wrote the story “Silver is going up 🙂“. But probably you are not so interested that somebody is getting richer, but more like how is somebody doing it… So I would like to share with you the background story what I had go trough to buy this silver…First I got the idea…Many times I heard Robert T. Kiyosaki talking about Silver… First time when I heard it, I was like ok… and did nothing. When I heard it again and again I got more interested about Silver… but I didn’t find ways to buy Silver here in Estonia… Finally when I visited New York in end of 2006 @ The Real Estate Wealth Expo (as volunteer for RichDad company) I met also Mike Maloney because he was with hes companion out at the fair. Normally they sell Silver & Gold through their web page, but as I live in Europe and they only deliver in US I convinced them to sell me some Silver right away. But I was there with my small bag (which I carried as hand baggage in air plain), so I couldn’t buy much anyway. Second problem which I had was that I didn’t had enough cash with me… so we made a deal that on the second day I will bring some cash and they bring me some Silver. Then I had to get the cash… For me it was obvious that I can go to ATM and take it with my bank card… but it was not so simple at all. In Estonia it’s possible to get from ATM pretty big amounts, but in US most of ATM only allowed to take 50 or 100 USD max. So I searched in Manhattan some bank offices where I could take bigger amounts at once… Finally using all my three bank cards (and three different ATM machines) I got the amount out what I needed… and I got my first Silver in the next Day 🙂 This part was more or less not so hard… but I wanted more… so I did some research here in Estonia and found two companies which could deliver Silver for me. BUT there were problems… they have to add VAT (18%) to the price. OK, I figured out that I could buy Silver to my company and get the VAT back from Tax Office. BUT then there was second, much bigger problem… they would sell me Silver but wouldn’t buy it back. The reason was that one of these companies sells Silver mostly as gifts and second as material for production companies and they have...

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Build your own online affiliate business

I’ve said periodically that I would share some of the “SpareTime Co” things for the business in the basement kind of thing for the different businesses I’m pursuing. Today, here’s a little bit of affiliate type stuff. They include lots of things to get you started. The following cost nothing to get started. You can promote through a web site, email, print, etc. and are available with one sign-up through Revenue Allies Affiliate Network. You can check out 4 of the programs below. The various ones offered currently through Revenue Allies Affiliate Network are: LHP Home Warranties (heck, buy one yourself through your own affiliate link and get paid for it if you are selling real estate), DISH Network, DIRECTV, Comcast, ADT (just starting), and Vonage! ::LHP Home Warranty Program:: Offer the most comprehensive home warranty service plan available. More Info: http://www.libertyhomeprotection.com?kbid=6839 Signup: https://www.libertyhomeprotection.com/resellersignup.aspx?kbid=6839 ::DISH Network:: Earn up to $145 or more offering the best in satellite television entertainment. More Info: http://www.revenue-allies.com/up.asp?id=6839 ::DIRECTV:: Earn up to $145 or more offering the best in satellite television entertainment. More Info: http://www.revenue-allies.com/up.asp?id=6839 ::COMCAST:: Earn up to $105 or more offering COMCAST’s triple-play service bundle: Internet, Phone & Video service More Info: http://www.revenue-allies.com/up.asp?id=6839 Because they’re offering such high payment on exclusive offers, they are only allowing a select number of affiliates to join. I wanted to let you know before they stop accepting new members. To learn more about the Revenue Allies Affiliate Program, go to: http://www.revenue-allies.com/up.asp?id=6839 This particular program is excellent for landlords, property managers and real tors because these services are needed by every home owner and tenant. And you can include them with your welcome package. Another feature is that it’s a two-tiered program. If people sign-up to offer these to consumers from your link, your sub-affiliate will still receive what they are supposed to and you’ll receive about $20 per customer they sign-up. One sign-up gets you into all of these programs. More affiliate stuff soon. Try it out; try many affiliate programs out for things that make sense for you. You do have some effort to put into it but you can develop a stream of income from it. Then you can put this money to work for you to get out of the rat race. Sign-up at Revenue Allies Credit:Build your own online affiliate...

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Small Deal / Cash Flow Deal

Jeff Howard of Cape Cod AREI and a partner are looking for $25K to help them refinance a great 2-family property on the beach in Marshfield, MA. To facilitate this, they are looking to get another 5% cash to bring their LTV to 75% because of the changing mortgage landscape. As always, do your own do diligence. You can lend as little as $50 and you’d get paid 18.26% APR on this! Prosper does all the tracking and collects a small amount of your earnings as a fee. When you set up as a lender using the link below, you get paid $25 just for funding your first loan! If you lend $50 to Jeff, if the loan goes full term, you’ll make $14.33 on your $50 while your principle is being returned monthly! 43% is a spectacular CCR. So check it out. You might just find this a vehicle that helps. Need to borrow? Give Prosper a try! Rates start at 7% and go up to 29%. You create a request to borrow, set your rate and lenders try to fund you. Be reasonable and you should get your listing funded. Small Deal / Cash Flow...

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Teachers of “the Secret”

What Happens When 3 Extraordinary Teachers from "the Secret" Come Together to Teach the Science of Getting Rich? by Mark Ginat The Science of Getting Rich is a timeless classic written in 1910 by Wallace D. Wattles. It is a bold title for a book and suggests that getting rich is a predictable outcome if one can master the principles outlined in the book. Here is how Wallace D. Wattles puts it in his own words, "The ownership of money and property comes as a result of doing things in a certain way. Those who do things in this certain way, whether on purpose or accidentally, get rich. Those who do not do things in this certain way, no matter how hard they work or how able they are, remain poor. It is a natural law that like causes always produce like effects. Therefore, any man or woman who learns to do things in this certain way will infallibly get rich." Certainly, this book is well referenced by many of the great teachers today and it is the same book that inspired Rhonda Byrne to produce that runaway success "the Secret". Here is what Rhonda Byrne said on her introductory note to the book, "I can honestly say that, since that first night when a tattered printed manuscript found its way to me (thanks to one of my daughters), my life has never been the same. Once you read it for yourself, you will understand why". Rhonda went on to produce the movie "the Secret" and the best-selling book of the same title which has sold millions of copies worldwide. However, learning how to do things in that "certain way" as described by Wallace D. Wattles may be more challenging for some as the book was written nearly 100 years ago. Some of the language is a little dated and much of its wisdom lost from a modern day perspective. Fortunately, a new training seminar for the Science of Getting Rich has brought the wisdom of this timeless classic back to life for modern readers. Called "the Science of Getting Rich", this program is the most comprehensive training system for mastering Wallace D. Wattles wealth creation philosophies and principles since its creation. It comprises written, audio and live seminar formats for learning, applying and mastering the Science of Getting Rich A unique "twist" to the program is the fact that it has an in-built vehicle for creating substantial financial wealth through its affiliate program. This is truly a unique wealth eduction and wealth building program designed to empower any individual with the resources to get rich. It is a...

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Robert Kiyosaki

Robert Kiyosaki’s business ideas were formed as a result of a number of business failures and one success.  Robert Kiyosaki’s real success came with a series of books based on the rich dad and poor dad characters.  Robert Kiyosaki, co-author of ‘Why We Want You to Be Rich’ gives you advice and tips on how to manage your finances to make your money work for you. Kiyosaki Kiyosaki is best known for his Rich Dad, Poor Dad series of motivational books and other material.  Kiyosaki also proclaims financial leverage to be critically important in becoming rich.  Kiyosaki stresses what he calls "financial education" as a means to obtaining wealth.  Kiyosaki speaks often of what he calls "The Cashflow Quadrant," a conceptual tool that aims to describe how all the money in the world is earned.  Kiyosaki stresses the value of games, particularly Monopoly, as tools for learning basic financial strategies such as "trade four green houses for one red hotel".  Kiyosaki’s claim is given some credence by the founder of mutual fund powerhouse Vanguard, John C. Money Money – Robert Kiyosaki, author of the successful Rich Dad, Poor Dad series of personal finance books, offers his insights to Yahoo Finance in a bi-weekly blog.  [2] Kiyosaki became active in a personal growth seminar, called "Money & You", which was started by Marshall Thurber.  Kiyosaki speaks often of what he calls "The Cashflow Quadrant," a conceptual tool that aims to describe how all the money in the world is earned.  "Cashflow 101" is a board game designed by Kiyosaki, which aims to teach the players concepts of investing and making money, it costs $195. Financial The book Rich Kid Smart Kid was published in 2001, with the intent to help parents teach their children financial concepts.  Kiyosaki stresses what he calls "financial education" as a means to obtaining wealth.  And according to Kiyosaki, in order to obtain financial freedom, one must be either a business owner or an investor, generating passive income.  Rich Kid, Smart Kid is a retelling of Kiyosaki’s views, condensed and clarified to try and help parents better understand and teach their children key financial concepts. Education His Rich Dad Poor Dad series of books have sold millions of copies worldwide and through his education programs he is reaching thousands of students with his financial messages.  CASHFLOW 101 is the only educational tool/game I’ve found that REALLY demonstrates the effect and interconnections that a single decision can and will have on your balance sheet and income statement.  In 1985, Kiyosaki founded an international education company that taught business and investing to tens of thousands of students worldwide. ...

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Finding the Right Business Partner

One of the best pieces of business advice I ever got was "You can’t do a good deal with a bad partner." Having had many partners over the years, I can say that this statement holds true. So I thought I’d offer some personal experiences I’ve had with partners both good and bad. All Play and No Pay The first partner is a former CPA who does spectacular pro forma projections. His numbers on the future viability of a real estate project are always well laid out and convincing. In fact, after first meeting him and his business partner, a Wall Street whiz kid, and looking at some photos of a property they were interested in and an architect’s rendition of what it would look like upon completion, I was sold. I became their money partner. So far I’ve done three deals with this pair, and to date, we haven’t made a dime. The numbers still look neat and tidy every quarter, just the way a CPA should present the financials. The problem is in execution: The projects never finish on time or on budget. Something always goes wrong, and there’s always some kind of drama — problems with environmentalists, city planners, or banks. Finally, after years of squabbling, his partner (the whiz kid) left the relationship. The projects of theirs that I invested in are still operating, but to date I haven’t made any money on them. A Complementary Relationship The second partner is Ken McElroy, a writer and personal friend. My wife, Kim, and I have made the most money with Ken. There are several reasons why: • We share the same investment philosophy. We buy, improve, hold, and refinance. We generally don’t like selling our properties. • His expertise makes up for gaps in mine. Ken owns the largest property management company in the Southwest, and his partner, Ross, is a real estate developer. Both men have nearly 20 years of experience in their respective fields. Because of Ken’s years as a property manager, he has the experience and skill to evaluate the value of an existing property. And Ross has the know-how to bring the reconstruction of properties in on time and often under budget. • We adhere to the same strategy. Ken, Ross, Kim, and I like to put our money in, improve a property, bring in better tenants at increased rents, reappraise the property, and then borrow our money out and move the equity on to the next property. We then repeat the process. A Near-Infinite Return For example, we put approximately $2.5 million into a $9 million, 300-unit apartment house, and secured a construction...

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Congratulations and Welcome to the Rat Race!

For Millions of People, Graduation Means Joining the Rat Race 1.3 million college graduates will exit academia for the work force this year, armed with a sheepskin and laden with debt. This debt, $22,221 on average… as reported by Student Monitor LLC, a leading market research firm, represents both credit card debt and student loans. Debt that, according to that company’s survey stats, will take eight years to pay off. And, in most cases, there’s more where that came form. It’ll take the shape of car loans, revolving credit and even mortgages.  In Rich Dad’s world, the Rat Race is that vicious cycle of living paycheck to paycheck… and the conventional wisdom that getting a good education, good grades and a safe, secure job (with “good benefits”) will lead  to “the good life.” Or, at least, a steady pay check so that there’s money to make monthly payments on expenses and debt.  These new grads are in good company: millions of Americans contribute their fair share to the $100+ billions in credit card debt ($46.6 billion with Capital One Financial alone) in the US. Debt that, in many cases, will take decades to pay off.  Nearly 90% of college grads surveyed in 2004* reported that they were “prepared” for the responsibility of credit cards… over half (56%) of them didn’t know the APR (annual percentage rate of interest) on those cards. In this case, ignorance may not be bliss.  So what is Rich Dad’s answer to the Rat Race dilemma so prevalent in our society? That’s easy: Financial Education. And we’re not alone in that mission. In mid-April of 2005, the Federal Reserve unveiled a new website that Fed chairman Alan Greenspan calls “an online tool that offers students easier access to a wealth of information in the areas of economics, banking and financial services.”  In 2002, Greenspan was quoted as saying that a good foundation in math would improve financial literacy and “help prevent younger people from making poor financial decisions that can take years to overcome.” He added, “People need to be able to read, write and speak basic financial concepts in order to make informed investment decisions.”  “The challenges Americans face – with social security, consumer debt, bankruptcy law changes, and retirement planning – don’t begin at age 65. They begin at age five, when kids enter school.”   – Robert Kiyosaki  Sources: Student Monitor research; MBNA and Capital One Financial reports; The New York Times Lessons for Graduates:  1. Work to learn… not to earn Sometimes a pay check is less important than the lessons you get from working. 2. Who’s giving you advice? Most people...

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