Entry 3: Lessons

The concept of using past experience or knowledge is the key to many situations in this life. I would say that past experience, whether that be from yourself or from someone else, is very important to becoming financially independent. However, I would like to note that I don’t mean using historical data to predict exact future data.

So let’s talk about lessons or more specifically financial lessons.

I have decided to take my first step into financial freedom. That first step is to read and read “Rich Dad Poor Dad” by Robert T. Kiyosaki

So let’s get right into it. What are the lessons?

“The rich don’t work for money.” – When I read this I am thinking, “But how is that even possible?”. However, if you really start to use your noggin, you begin to realize that instead of the rich don’t work for money; they actually let money work for them. You see, when you go to your day job you are working for your money. You work 40 hours a week and you get a paycheck bi-weekly. The rich though, buy investments and then manage them. As there cashflow starts to stream in they reinvest them back into more assets (will talk more about that topic at a later date). So the main Idea here is to not work for your money but let your money work for you.

“Savers are losers.” – This seems to be the opposite of what I was taught that you work, get paid, pay bills, and try to save as much as possible. In this case saving to me ment putting in a savings account. While this perspective is sound, it also limits your possibilities for financial freedom greatly. After doing some research I have come to find that most “savings” accounts don’t off more than 1.5% interest per month. This is quite shocking and scary to think that most people just put their money away and leave it there until they retire; if they ever retire at that. It seems to me that saving is not the way to be financially independent.

“Your house is not an asset.” – I had a difficult time understanding this one as it seems that a house definitely is an asset. I used to believe that a house meant more money, not less. If you really think about it though – yes a house may acquire more equity but does it really give you a great margin after you take into account all the expenses? That’s where a house does not become an asset – expenses. House are a money pit worth of expenses. Whereas if you own the assets to pay for the expenses then you would be in a great spot.

I will stop here for now as I need to get back to my day job. Come back tomorrow for more!

As always, subscribe and share to everyone you know. Have a wonderful day!

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