Cash Flow Quadrant
In Cash Flow Quadrant (Rich Dad Poor Dad), Robert Kiyosaki discusses four categories.
The first category of people is called employees. Who make their living by working for someone else. They invest their time and skills for the wages and need to work continuously for the money.
The second category of people is called Self-Employe. Who make their living by providing their services independently like shop owners etc.
The third category of people is called the Business owner. Who owns the business and the first category people work for them.
The fourth category of people is the Investors, Who invest their money in the businesses and make money from the return.
The employee earns income as a function of time and skills where time is a limited commodity. So they may have money but hardly any time.
The second category relatively has more time but is tied to their shop etc. In India, their average income ranges from 10,000–12,000. It depends on their nature of work and the city in which they are living.
The third category has huge manhours to work for them. For companies like Amazon or Google, It can be millions of manhours per day. They own a large chunk of money but managing such a venture requires day and night efforts. So they do have a lot of money but very little time to spend.
The fourth category of people who make money work for them is called Investors. Their input is money so is the output. So they have money as well as time.
If we look from the perspective of the Indian economy, the Ginni coefficient for India is 49.7 (2019 data), second to Russia only. It means there exists a sharp contradiction in Indian society. Almost all of us want to be in the fourth quadrant. But most of us belong to the first two quadrants only.
To which category do you belong?