Although I don’t agree with a lot of what Robert Kiyosaki stands for, I appreciate his tenacity to teach people that they should be increasing their assets, not liabilities.

Kiyosaki wrote the book Rich Dad, Poor Dad. I was inspired by the book and a lot of things he said. It reframed my idea of building wealth.

For one, I got more excited about passive income. It helped me realize that we can only go so far with our active income, such as our 9-5, because we only have a finite number of hours in a day and energy to spare. This appealed to me significantly because I consider myself sleepier than most (limited energy), but still ambitious to be rich. This means I had a problem and passive income seemed to be my solution.

The most general take away from Kiyosaki’s bazillion books is to increase your assets and assets are things that put money in your pocket. But he also talks about the four quadrants. The four quadrants are ways in which you can make money: being an employee, being self-employed, being a business owner, and being an investor.

Being an employee and being self-employed have limitations because you need to be there to make money; you’re limited by your energy and the number of hours in the day.

The real money is located in the investor and business owner quadrants. The goal is to flow your employee and/or self-employed money into the other two quadrants: investing and business owner.

The difference between self-employed and business owner is that a business owner hires people to run the business; self-employed are people who need to be there like lawyers, doctors, accountants, or any person whose business can’t function without them being there.

The quadrant that gets the most attention from me is the investing quadrant. Kiyosaki doesn’t consider stocks in general to be assets because non-dividend stocks need to be sold for you to put money in your pocket. However, he does consider dividends producing stocks to be assets.

Dividends are a portion of a company’s net earnings for the year that they pay out to their shareholders. For each share of stock you own, you get a set amount of cash each quarter.

These days I transfer as much money as I can from my employee income to my investor quadrants. Real estate is also considered part of the investor quadrants, so you have options.

The ultimate goal is to build up enough passive income to cover your bills. This adds stability to your life because it means that if you can’t show up to work due to health or other responsibilities, such as taking care of an elder or kids, you can still pay your bills.

So the next time you get a paycheck from your employee quadrant, consider putting some of the money into the investor or business owner quadrant.