You don’t need to have money to make money.
It is necessary to have an aspirational dream,
a decisive will,
an ability to learn quickly,
know how to use your talents
to help others achieve their dreams.
Big problems can gain the big payment.
The greater the passive income you can build,
the freer you will become. ―Todd M. Fleming
In 1985, my wife Kim and I had no home to live in.
We were both unemployed
and didn’t have a dime left in our savings accounts.
Credit card has been exhausted.
We had to spend the night in an old worn-out Toyota.
As the last day of the week approached,
we began to absorb the harsh reality before us,
tormented by questions of who we were,
what we were doing,
and where our lives were headed.
Our homelessness extended by two weeks.
Finally, a friend who sympathized with our dire financial situation
let us stay in a room in her basement.
We lived there for nine months straight.
We keep our story private from everyone.
My wife and I try to keep our appearances normal.
Until friends and family learned of our plight,
their first question was always:
“Why don’t you get a job?”
At first I tried to explain,
but then we found it impossible to explain our reasons to everyone.
For someone who values work,
it can be difficult to explain to him why he or she doesn’t want to get a job.
Of course, we also had to do a few extra jobs here and there,
but those little bucks were just to fill our stomachs and refuel.
Those meager salaries we consider them to be like liters
of gasoline pushing us to pursue our only goal.
I must admit that during those years of tormented skepticism,
the idea of a stable, secure job
with a decent salary was very tempting to us.
But because job security was not what we were looking for,
we struggled every day on that arduous financial edge.
That year, 1985 was the hardest year of our lives,
and it lasted like a century.
The person who says money is not important certainly has never tasted
without money for a long time.
Kim and I kept arguing and arguing.
Fear, anxiety about a bleak future,
and gnawing hunger combine to heighten the drama of human emotions,
causing us to often quarrel with those who love us the most.
However, strong love has connected the two of us together,
making us even closer to each other to cope with adversity.
We knew which direction to go,
but we just didn’t know if we could get there.
We know we can always get a job that pays well.
Both of us graduated from college,
have solid expertise and a very serious working attitude.
But we’re not aiming for that job guarantee.
What we aim for is financial freedom for ourselves.
Around 1989, we became millionaires.
Although we are rich in the eyes of many people,
we ourselves are not satisfied
because we have not achieved our dreams.
We have yet to achieve true financial freedom.
It wasn’t until 1994 that that dream came true.
From then on,
for the rest of our lives,
we will no longer have to work for anyone.
With the exception of a sudden financial disaster,
so far we are completely free of money.
At that time,
Kim was 37 years old and I was 47 years old.
It doesn’t takes money to make money.
The reason I started this book about my homelessness and poverty is
because I often hear people say,
“It takes money to make money.”
I do not agree with that view.
From homelessness in 1985 to
when I became rich in 1989 and then truly financially free in 1995,
the process never started with money.
When we started,
we didn’t make money,
but we didn’t need a good formal education to make money.
I graduated from college,
but I dare say that the financial freedom
I have achieved has nothing to do with what I learned in college.
I used nothing from the subjects
I was taught in calculus,
or English literature.
Many successful people in life often drop out of college.
People like Thomas Edison,
founder of General Electric;
owner of Ford Motor Company;
the father of Microsoft Corporation;
founder of CNN;
founder of Dell Computer Corporation;
founder of Apple Computer;
and Ralph Lauren,
founder of apparel company Polo.
A college degree is only important for classical majors,
not for how those characters become billionaires.
Those people have created their own successful businesses,
and that is exactly what Kim and I aspire to achieve.
Then what is new to make money
Many people often asked me,
“If it doesn’t take money to make money,
and schools don’t teach you how to achieve financial freedom,
then what makes money.”
My answer is:
It is necessary to have an aspirational dream,
a decisive will,
an ability to learn quickly,
know how to use your talents available in you,
and use which part of the diagram that can generate your passive incomes.
What is the diagram
The diagram below is
L- group of wage earners
(worker, staff, employee work for someone or a company )
T- group of people
C- group of business owners, companies
(An entrepreneurs open company, rent others work)
D- group of investors(Investors make money works for you)
What location in the diagram that can generate your own income?
The diagram shows four different ways of generating money for people.
For example, an employee earns money by working for someone or a company.
Self-employed people make money by working for themselves.
An entrepreneur makes money from his business,
and investors make money from a variety of investments,
in other words,
from using money to create more money.
Those different methods of making money require different thinking patterns,
lifestyles, specialized skills, educational intakes,
and compatible personalities.
Different types of people will be drawn to different zones.
While money is a common object, the ways to make money are manifold.
If you start paying attention to the division on the diagram,
you’ll probably ask yourself this question,
“Where do I make my money mainly from in that diagram?”
Each part of the diagram is different.
To earn money from different parts requires different skills and personalities,
even though a person can be in those different parts at the same time.
You can make money from any position of the diagram
that can generate your own income
Most of us have the ability to make money from all four groups on the diagram.
Which group of people you
or I belong to and mainly make an income from is not determined
by what we are taught in school,
but by what we are
these are our opinions values,
and personal preferences.
It is these fundamental differences that attract
or repulse us to those groups in the quadrant.
However, no matter what profession we are in,
we can survive and work in all four groups.
For example, a doctor can choose to earn money
as an employee in the L category,
by joining the team of doctors in a large hospital,
or working for the government on care projects.
public health or become a military doctor,
or work for a health and life insurance company.
That doctor can also choose to make money
as a self-employed person in the T group,
opening a private practice,
hiring a few nurses and bringing in some patients for himself.
Or he may decide to become a C businessman,
own a private hospital and hire other doctors to work in his hospital.
The doctor might consider hiring a manager to run his company-hospital,
and so in that case the doctor owns a business
but doesn’t have to work in it.
The doctor may also decide to own a business
that has nothing to do with medicine,
but still practice his medical profession somewhere.
In that case,
the doctor can generate income both as an L person and as a C person.
As for group I,
the doctor can make money
by becoming a shareholder in another person’s business
or by investment tools such as the stock market,
bond market, real estate market, etc. movables.
The most important words are the words “make money from”.
It’s not the industry we’re in that matters,
it’s the way we make money that matters most.
Different ways of incomes
It is the root differences in values, strengths,
weaknesses and preferences that influence
which group we choose to generate income from.
Many people just like to work,
while others hate it.
Many people are passionate about owning a company but do not run it,
but there are also many people who both love
to own a company and like to manage their own company.
Many people are very interested in investing,
while in the eyes of many others only see the risk of losing money.
Most of us have more or less all of those traits.
Being able to succeed in the four groups often requires an adaptive orientation
to our respective root values.
You can be rich or poor in all four groups
It is equally important to note that we can be rich
or poor in all four groups.
In each group, many people can earn millions of dollars,
but there are also countless people who are broke.
Belonging to one group or another does not necessarily guarantee financial success.
Not four groups are equal
Understand the peculiarities of the four groups in the quadrant,
you will determine which group is most suitable for you.
For example, one of the many reasons why
I primarily act like a C or a D is due to the tax advantages.
For those working on the left side of the quadrant,
there is little possibility of legal tax relief,
unlike for the right side of the quad.
When I work for a C or D income,
I can earn money faster and make it work for me longer
without paying excessive taxes.
Different ways of money
Diagram clearly distinguish the different ways
that people use to create their own money.
There are ways to make money
with a sense of responsibility rather than working for it.
Two different dads and different opinions on money,
my highly educated father deeply believed
that the passion for money was a sin.
Excessive profit is only a manifestation of greed.
He was embarrassed
when the press published his salary,
only because he felt he was overpaid
while other teachers working for him were receiving a meager salary.
My father is a loyal,
honest and hardworking person who always wholeheartedly defends his opinion
that money is not an important issue in his life.
My highly educated but poor father always said:
“I don’t care about money”
“I will never be rich”
“I can’t afford it”
“Investment is risky”
“Money is not everything
Money supports life
My rich dad had a different opinion.
He thinks it’s foolish to spend his
whole life working for money
and pretends that money doesn’t matter.
Rich dad believes that life is much more important than money,
but money is important in supporting life.
People often say,
“You only have so many hours in a day,
and yet you work so hard.
So why work hard for money?
Learn how to get your money
and people back to work for you,
and then you can be free to do the important things in your life.
For rich dad, what matters will be:
1. Have plenty of time to raise your child.
2. Have money to do charity work and sponsor necessary works.
3. Create jobs and financial stability for the community.
4. Have time and money to take care of your own health.
5. Can travel around the world with loved ones.
“Those things take money,” said rich dad.
“That’s why money is so important to me.
Money is important,
but we don’t want to spend our lives working for it.”
One reason why my wife
and I always focus on the C and D groups
when we don’t have a home to live in is
because we have gained a lot of experience
and education about these groups.
It was rich dad’s guidance
that helped me understand the different financial
and professional advantages of each group.
For me, it is the groups on the right side of the quadrant, i.e. C or D,
that offer the best opportunities for financial success
and financial freedom.
At the threshold of 37 years of age,
I have experienced many successes and failures in all four groups,
which have helped me gain some insight into my personal characteristics,
the good and the bad.
And I already know which group I will succeed in acting in.
Parents are teachers
Ever since I was a child, rich dad used to mention diagram often.
He explained to me the difference
between a successful person on the left and right sides of the quadrant.
But at that time,
because I was too young,
I did not fully understand what he said.
I don’t understand the difference in thinking
and reasoning between an employee and an owner.
Simply put, I just worry about how
I can survive in school and go to class.
However, I heard what he said and it soon became meaningful to me.
Having two dynamic and successful people around me helped me to compare
and understand each person’s words.
It is what the two fathers are doing
and acting that best illustrates the difference between the L-T
and the C-D sides of the quadrant.
At first, the differences were faint,
but gradually they became more and more obvious.
For example, one of the most painful experiences for me
as a child was the time one father played with me versus the other.
As both fathers became increasingly successful and famous,
I noticed that one of them had less
and less time to spend with his wife and four young children.
My biological father was always on the street,
busy with nonstop meetings,
or rushing to the airport to catch the flight to other meetings.
The more successful a person is,
the less likely he is to have dinner with his family.
On weekends at home,
he buried his head in the piles of work papers in his small room.
Meanwhile, rich dad has more free time
as he becomes more successful.
One of the reasons I have learned so much about money,
business and life is because rich dad has more time
to spend with his children
and with me all the time.
Another experience is that the more successful both fathers are,
the more money they earn,
but my educated biological father sinks deeper into debt.
the harder he worked,
the more he found himself taxed on income.
His banker and accountant advised him
to buy a bigger house to reduce taxes.
And so he obeyed,
buying a bigger house,
but also because of that he had to work harder
to have enough money to pay for the new house,
and that made him more and more distant from his home.
Rich dad was different.
People make a lot of money,
but pay less taxes.
He also has his own banker and accountant,
but he doesn’t take advice like my educated biological father.
However, the main motivation that pushed me
to cross the fence from the left to the right side
of the quadrant was what fell on my highly educated poor father’s life,
while he was at the peak of his career.
In the early 70s,
I graduated from college
and entered a pilot training course in Pensacola,
Florida, to prepare for the Vietnam War.
My educated father was at the time serving
as the Hawaii Inspector General of Education
and was a member of the Governor’s Advisory Board.
After the election for Governor of the state,
the reappointed governor angry
that my father had campaigned for his opponent quietly instructed him
not to allow my father
to be reinstated in government.
in the state of Hawaii.
And people have never found the same job.
At the age of 54, my father had to run away to find a job,
and I was on my way to Vietnam to join the army.
At the age of fifty,
my father had to go find a new job.
People who work from place
to place with titles that sound great,
but with low wages.
Something like the executive manager of a nonprofit agency XYZ,
or the director of a non-profit ABC organization.
My father was a tall,
intelligent and active man,
but he was never welcome in the world
where he worked for more than half his life,
the world of government servants.
People turned to business,
starting with a few small businesses.
There was a time
when he worked as a consultant,
and even bought a famous franchise,
but all failed.
As he grew older,
his enthusiasm dwindled,
and his courage to start all over again waned.
His will is less and less after each business failure.
He was once a successful employee in group I,
now exists in group T
without his own experience and passion.
People love public education immensely,
but there is no way to return to that world.
The state government has implicitly directed
to ban the education industry from recruiting him,
which in a way can be considered as “blacklisted”.
Without social and health insurance,
perhaps the last years of his life
he would have been miserable and miserable.
He died feeling extremely discouraged and angry,
but his conscience was completely safe and clean.
So what made me willing to endure those dark years in 1985?
It was the terrible,
tormenting memory of an educated father sitting at home waiting
for the phone to ring,
and trying to succeed in the business world he knew nothing about.
It is that, and it is the sweet memory
of watching rich dad become happier
and more successful as he gets older
that gives me an inspired desire.
Instead of failing at the age of 54,
rich dad was beyond imagination.
For many years he was rich,
but by then he was a hundred thousand times richer.
He often appeared in the press as a businessman
who bought out the Waikiki and Maui regions.
Years of hard work building businesses
and investing methodically have reaped bountiful harvests for him,
and made him one of the richest billionaires in the Hawaiian Islands.
Small Differences Can Lead to Big Differences
Because rich dad explained the Golden Four Charts to me in detail,
I can clearly see the small differences
that grow bigger and bigger
with people’s working time.
Thanks to the Quad,
I can focus on choosing the group of people I want to join,
rather than choosing what I want to do.
During the most tragic years of my life,
it was the profound understanding and experiences drawn
from the lives of two powerful fathers,
which helped me endure and overcome.
But the story doesn’t stop at the Quadratic
The diagram map is just a dash and a few characters in it.
If you look beneath the surface of that simple figure
you will see completely different worlds
as well as different ways of looking at the world.
When a person sees society through the eyes of
both the left and right quadrants,
I can confess that the world will be very different
according to the position he stands and exists in society.
And those differences are the central theme of the book.
After reading this book,
some of you will want to immediately change the way you make money,
but also you will be perfectly happy
to continue your standing in society.
You can choose to act in multiple groups at once,
even in all four groups.
We are all very different,
and one group is not necessarily more important
or better than another.
In every village,
city or country in the world,
it is still essential to have people working in four groups
to ensure financial stability in the community.
as we age and accumulate various experiences,
our preferences will change.
I have noticed that many young people
after graduating from school are often satisfied
when they get a job.
But after a few years, many of them will no longer be interested
in climbing the office ladder,
or lose their passion for the business they are operating.
Changes in age and experience often lead a person
to seek new goals for growth,
and more personal happiness.
I hope this book will be able to give
you some breakthroughs in thinking
and ideas to achieve those goals.
In short, this book is not about homelessness,
but about finding a shelter,
or all four groups of society.
Before you can become a millionaire,
you must learn to think like one. ― Thomas J. Stanleyt