The Rich Dad way

Through out most of Robert's books he explains his rich dad's way to wealth.

The formula he taught is to start a business of some form and get it making you money. Then you take the profits form the business and buy real estate you can use for long term investing in cashflow (rentals). Once you have a cashflow from these properties you can then use that money to pay off your debts, buy the stuff you want, and invest in more real estate, business, and paper assets.

I know it sounds simple yet this process takes several years to do and requires a lot of education. Not just formal education yet mostly financial and entrepreneurial education. Most people believe they have to work for money. They trade dollars for hours and their idea of getting ahead is to earn more dollars per hour or trade more hours. This is not what the rich dad pattern is.

Lets take this one step at a time:

Step 1- Build a business. This can be done by joining a network marketing company, starting a real estate investing company, owning a direct sales office, starting your own company from scratch, buying a franchise, etc. The key is to start something that you can do for many years. Learn to work for free. Learn to make money by producing and promoting something rather than trading hours for dollars.

Step 2- Invest the business profits into real estate. Take what you have earned in your business and basically start another business having rental properties and properties you can create a monthly cashflow with. This residual income will help you create infinite returns with your money. Most people take their money and use it to make payments on things they want to have. They give what they can have in the future for the pleasure of owning a toy now. To me it makes more sense to take my money and invest it so I can have people pay me monthly payments rather than use it to make monthly payments to someone else. In this way I can buy my toys with cashflow, pay them off and still have cashflow coming in.

Step 3- Get out of the rat race. The key to this is to have more cashflow coming in than payments going out. This means your bills are being paid without you going to a job. Your rentals are paying your bills. This is financial freedom. For all intents and purposes you don't have any bills at that point. The money you used to use to pay your bills now becomes money to do what ever you want.

That is my goal and I hope your goal too. I will keep posting more on how to do this.