Being a family man and seeing my two kids grow up is absolutely the most beautiful thing ever.
I consider myself lucky, because I woke up and decided that things had to change one day.
Only a few days ago I was on my way to the gym when I was crossing the road that is leading to the freeway, around 5:30 pm.
And you can probably guess what I saw there. Right, a lot of traffic.
Better said, one big traffic jam!
Thousands of people leaving from their work, going back home. This whole concept of doing the same thing day in and day out, really freaks me out.
I always questioned myself “why do we people do that?”
I guess it is because people are convinced that they don’t have a choice. They feel that they are trapped.
Because their expenses are higher than what they earn.
How to escape from the Rat Race?
When my son Nick was born, it really hit me. The time went by so fast.
Sem, my daughter was 5 years old at that time and I missed out on a lot of important milestones in her life.
Just because I was so busy. Busy with what I thought or hoped to get me rich or at least free.
In my journey to freedom I started to read a lot personal development books. I believe that if you do not feed your mind on a daily base it can not come up with new and bright ideas.
The Book that Changed my life
So I have a subscription on Audible.com. So I listen to books.
The greatest thing I like about that you can listen to your books on the moment you wouldn’t be able to read.
Like when you are riding your bike.
In Rich dad poor dad, Kiyosaki tells the story of him growing up.
His own dad (poor dad) was a well educated school teacher with a good income. But despite all the education and the well paid job, his poor dad was always struggling to get by.
Always struggling to pay the bills.
His rich dad on the other hand. The father of his best friend was a high school drop out and owned multiple businesses.
In his book Robert Kiyosaki spends the first few chapters about the concept of the “Rat Race”
He describes it as a self defeating cycle that goes like this:
An employee works hard for an employer to receive a salary. He will put in the extra work to get a raise or a promotion and as their income increases.
But when their income increases so do their expenses.They buy a house, a new car and stretch their creditcard.
As the employee’s debt increases, he will become further tied to their job and highly depended upon their pay check.
They will work even harder in order to get that next promotion or raise which they need to pay of that debt.
Only to find out that the whole cycle starts from the beginning.
The introduction to the “Rat Race” begins as a child.
From an early age, most of us are told that we should work hard in school to get good grates so we can get into college.
After graduating from college, your are supposed to find a secure job with generous benefits.
You should put sums of money aside to buy a house and luxury items in the future.
Over the years your debts will grow and you will fall deeper into the trap that is called the Rat Race.
Assets and liabilities, the difference.
Mister Kiyosaki also talks about why the rich are rich and the poor and middle class will not.
This bit opened my eyes and I was shocked, realizing the amount of liabilities I own!
He explains the difference between liabilities and assets in a way that is to understand for everybody.
An Asset is something you buy that puts money INTO your pocket. And a liability is something you buy that costs you money, money that goes OUT of your pocket.
The rich focus on buying assets and the poor and middle class keep focusing on buying liabilities.
He points out that a house is not a asset as most people think. When you buy a house you will increase you debt and therefore your costs will rise.
How to get out of the Rat Race
Even though it feels like there is no way out of this Rat Race, Robert Kiyosaki believes in the power of freeing yourself from the “Rat Race,” from the cycle of dependence upon your employer for economic welfare and reliance upon credit to buy luxury items.
What he points out is that it is very important to mind your own business, acquire assets, and develop a financial intelligence and a strong sense of discipline in order to free yourself from the “Rat Race.”
The Reason Why You Don’t Know How to become wealthy
Kiyosaki and Sharon Lechter, the author of the volume’s introduction, both recognize financial intelligence as a keystone to getting rich.
They wonder why so few people invest time in developing a financial IQ and instead intentionally avoid talking or thinking about money.
I never had a “rich dad” and on school they never taught me anything about money.
“Money is not important” they would say or “concentrated on your study and the money will come” But by the time it comes, you are stuck in the Rat Race.
Why don’t they teach you anything about money?
Simply because, leaving out the exceptions, the teachers don’t know either, so how can they teach you?
The authors also questioned the fact why financial literacy is not taught in schools. They say if children learned financial concepts at an early age, they would be more likely to succeed in the future.
Instead, many kids never hear their parents discuss money or they see the struggle and the stress and fights it brings it along ( because the lack of money)
It is considered rude to bring up the topic of money in social situations.
Kiyosaki keep pointing out the importance of financial intelligence. He describes ways to develop a solid financial IQ, including understanding and mastering the principles of accounting, understanding markets and how they work, and understanding the law (especially tax law).
He goes on explaining that it is perhaps easier set some time aside to develop your financial IQ than it is to keep following the traditional model of generating an income. (working for an employer who provides your income and saving money on the side after paying expenses
Taking Risk Vs Staying in safely in your comfort zone
It’s about the choice between risk and safety. Kiyosaki and his rich dad believe that without risk, you can never be rich.
Almost every rich person in the world has his or her share of failure in the form of losing a lot of money.
Accepting risk is essential on the path to becoming rich.
On the opposite “playing it safe” never leads to wealth.
In the book Robert Kiyosaki talks about several examples.
Examples of people in his life who missed out on great opportunities because they stuck to safety, instead of exposing themselves to any degree of risk.
One example made thing very clear for me.
To point out what can happen if you are playing it safe, he relates to a specific incident.
During this incident he advises his friend, who was looking to get into the real estate business, to say yes to a potentially lucrative deal. He could buy himself in for $5,000.
His friend bailed at the last minute because he was concerned that he would lose all of his money.
The property he rejected later became worth $95,000.
His fear and desire for safety prevented him from taking a deal that would have made him a lot of money.
This doesn’t mean that you just take blind risk and you’ll be rich. Of course not, that’s why he hammers on developing a strong financial IQ.
First you must accept the risk as a necessary part of your financial life, and secondly, you must learn how to MANAGE the risk.
Once you developed your financial IQ and you are confident with your skill set and learned how to manage your risk, you can now invest and avoid potential financial disasters.
When I read the book it really hit me how little I knew about finance.
I always said
You do what you are good in and hire somebody else to do the finance for you.
Now I know how silly that must have sound! Putting your financial future into the hands of somebody else.
How to get out of the Rat Race.
Knowing your numbers is where it all begins.
What are your expenses? And what is your income?
First you have to focus on your assets. You have to grow your assets. Think about bonds and stocks or money generating real estate etc etc.
Let’s say your expenses are $2000 a month and the money you make with your assets is a $1000, you will last 2 weeks if your income would disappear (in case you would lose your job)
But if the money you receive from your assets extant your expenses you are wealthy.
Creating multiple streams of income
It is important to create multiple streams of income so you won’t have to depend on just one.
So if something was suppose to happen, for example you get laid off, then your financial situation wouldn’t be effected and you would still be able to grow financially.
One of the models Kiyosaki really endorsed heavily was the network marketing industry.
It has low investment start up costs and there were endless opportunities.
Building multiple streams of income online is possible and being online takes away all the borders.
Like this blog.
All the articles written here are there to stay. Even after years people will find this post, like it and look further on our website. They can click on the banners or scroll through all the other posts.
Using a viral blogging platform like this Kalatu blog is crucial, because you don’t want to be losing time creating back links and other stuff in order to be found on Google.
Improving your skill set, a summary
We talked about improving your financial IQ, your financial skill set, so you know how to manage your risk.
The risk that you must be willing to take for to get to the financial level of your desire.
Going from the network marketing to the internet network marketing is a small step, but a very lucrative one. There are a lot of people who have made millions in this industry.
But, there are even more people who didn’t make any money with it. 99% of the people do not succeed in this industry. Why? because they do not take the action necessary.
Improving your skill set and be consistent until your have reached your goals. Like Tony Robbins points out:
There is no such thing as failure, there are only results.
But how or where can I learn the skills needed for internet network marketing you ask?
Well, there are many roads to Rome as we like to say, but personally I like to take shortcuts.
And by shortcuts I don’t mean, “click on button and get rich quick”, but a way that makes things easier.
What if you were able to tap into a system that would teach you everything there is to know about online marketing and knowing your numbers?
A system where you don’t have to worry about the technical stuff, like building websites.
A system where you are taken by the hand and that will guide you through the process step by step, until that point where you can walk on your own.
This is the system what I recommend you use. It is the system that took me from being stuck in the Rat Race, hitting bankruptcy in 2014, to now owning my own online business and learning every day still.
Please get out of that Rat Race, before you either die of a heart attack or before you realize that you missed out on seeing your children grow up.