Thursday, July 30, 2009

Keep Your Day Job But Start Minding Your Own Business

Lesson 3: Mind Your Own Business


Kiyosaki sold photocopiers on commission at Xerox. With his earnings he purchased real estate. In 3 years' time his real estate income was far greater than his earnings at Xerox. He then left the company to mind his own business full time. He knew that in order to get out of the rat race fast, he needed to work harder, sell more copiers and mind his own business. Don't spend all your wages. Build a good portfolio of assets and you can spend later when these assets bring you greater income.


Lesson 4: The History of Taxes and the Power of Corporations


Income tax has been levied on citizens in England since 1874. In the United States it was introduced in 1913. Since then what was initially a plan to tax only the rich eventually "trickled down" to the middle class and the poor. The rich have a secret weapon to shelter themselves from heavy taxation. It's called the Corporation. It isn't a building with the company name and logo in brass signage out front. A corporation is simply a legal document in your attorney's file cabinet duly registered under a government state agency. Corporations offer great tax advantages and protection from lawsuits. It's the legal way to protect your wealth, and the rich have been using it for generations. Do your own research and find out what tax laws will bring you the best advantages.


The Golden Rule: PAY YOURSELF FIRST.


Rich dad says paying yourself first forces you to create more sources of income to cover your expenses. It's a simple rule that works like this:

The Rich with Corporations - Earn, Spend, Pay Taxes


People who work for corporations - Earn, Pay Taxes, Spend


Key Financial IQ Components:

It helps to take some courses to gain financial literacy. Rich dad stresses the importance of learning –

1. Accounting. It pays to know how to read financial statements. When acquiring businesses or assets you need to quickly see the financial standing of the company you are acquiring. Many grown adults do not know how to balance a balance sheet. In the long term, this knowledge will pay off for you and your business.

2. Investment Strategy. This skill will sharpen with experience. Talk to investors and observe how they play the game. Kiyosaki and Mike spent many boyhood hours sitting in on Rich Dad's meetings with brokers, accountants, and attorneys.

3. Market Behavior. Know the laws of Supply and Demand. No business owner can do without understanding these basic principles of the market. Bill Gates saw what people needed. Open your eyes to opportunities. Look at what sells and who buys.

4. Law. Kiyosaki recommends doing everything you can to grow your business within legal boundaries. Know your corporate, state, and accounting laws.


Related posts:
1. School Makes You Good Employees, But Financial Literacy Makes You Good Employers
2. The Secrets About Money You Don't Learn In School
3. Ten Steps To Awaken Your Financial Genius



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