Wealth Education (2): You Can Make Money While You Sleep
Let
me start this second post in our Wealth Education Series with this inspirational
thought by Ronald Osborn. “Unless you try to do something beyond what
you have already mastered, you will never grow.” If there is any area this
thought holds true, it is in the area of building wealth. Robert
Kiyosaki has illustrated the 4 Wealth (Income) Quadrants in a way that even a
lay man will understand as follows:
As we can
see, those in paid employment (Employees), who HAVE a job, basically trade
their time for money. Self-employed persons, who OWN a job, also trade their
time for money. These two quadrants on the left side, which constitute about 95
percent of the population, can be said to receive approximately 5 percent of
the world’s wealth.
On the
other hand, Business Owners, who OWN BUSINESS SYSTEMS, use systems both human
and machinery, to generate wealth for themselves. Also, Investors, who OWN
INVESTMENTS, use their investments to generate wealth. These two quadrants on
the right side, which may not be more than 5 percent of the population, control
95 percent of the world’s wealth.
More
precisely, a new report by Oxfam indicates that the world’s eight
richest people (billionaires) have the same wealth as the poorest 50 percent of
the world population. In other words, half of world's wealth is now in the hands of one
percent of the world population. Also, Forbes report of the top
ten billionaires in 2017 shows that almost all of them are Business Owners,
that is, own business systems. It is a few of them, particularly Warren Buffett,
who are in the Investor Quadrant, that is, they own investments.
Wealth education means that
in order to enjoy financial freedom, even if you are in the Employee (E) or
Self-employed (SE) Quadrants, you should engage the income you receive in those
left side quadrants in such a way that you begin to gradually move to the right
side of the quadrants. In other words, engage income from E and SE in such a
way that you can create assets that generate cashflow and wealth. This is what
the rich people of the world do. This is what it means to make money while you
sleep. Even while the wealthy people are sleeping, their business and
investment systems are said to be generating income for them. It is believed that the
not-too-rich people only make money while they are awake. This is said to limit
the income they make.
This is a pertinent question
to ask, is it possible for everybody on earth to be wealthy? Given the
different economic situations in the world, is it possible for all human
beings, irrespective of country, sex, and education, to become financially free
to have enough money to do all that they would want to? Are there some social metrics
that make wealth by all impossible? Is making money while we sleep a smart way of building wealth in the digital age? Your
comments will be very much useful in these discussions.
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