Passive Income
Going through kiyosaki’s rich dad series I learn that he speaks of a few businesses where in you can generate passive income. Kiyosaki talks of investing in equity and real estate. Network marketing is also one of the tools to generate passive income. This is a system which uses the power of leveraging to your benefits. Passive income is earned with little or no human intervention. That means if I were to do little or nothing for a long time, the cash will still come to me continuously. For example, when I invest in a property to collect rental income, there is little or no work required on my part to earn that rental income.
I should be focus on building passive income. That means I should be investing in assets that generate positive cash flow as a passive income.I think I have to give kiyosaki’s definition of assets and liabilities in here , according to which an asset is one that generates positive cash flow. If it does not generate income, then it is a liability. Very simple but very effective . If you have a big house , most of us consider it as an asset but the fact is , you have to pay in order to maintain it which generates a negative cash flow .So that is more of a liability. If we get a rental income on that house leading to a positive cash flow, it qualifies as an asset.
In my last post I talked about time. Passive income gives you more quality time which in return improves the quality of life. Time matters a lot , we should either look forward to speed up our processes or try and make the systems automated so that it takes over and does not require much input from us.
“The only difference between a rich person and poor person is how they use their time”Robert Kiyosaki
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