It is important to understand how money worked in the past and how money worked for you.
Lesson 2: Understanding your financial statements
To grow, you need to know how to read and understand the three financial aspects of your financial statements: profit and loss statement, balance sheet, cash flow statement.
Lesson 3: The difference between assets and liabilities
One of the reasons many people have financial problems is because they confuse assets and liabilities. For example, many people think their home is an asset, but it is not. The simple definition of wealth is that anything that has money in your pocket or means that it can earn you a regular income.
Lesson 4: The Difference Between Capital Growth and Cash Flow
Many people invest in raising capital, which means they are betting on the value of what needs to be raised. Investing for capital growth is similar to gambling. Instead of investing for capital gains, wealthy investors have invested in cash flow and capital gains.
Lesson 5: The difference between basic and technical investment
Basic investing is the process of analyzing a company's financial operations and begins with an understanding of financial statements. Technical investment is measuring market conditions using technical indicators. You can successfully invest in both types of investments, but you need to be committed and pursue a financial education.
Lesson 6: Measuring the strength of an asset
There is no shortage of opportunities in the world of investing. What investments are worthwhile? A key component of a complete financial education is understanding how to measure whether an asset is strong or not. One of the best ways is to look at the full range of assets in the B-I triangle, which includes elements such as team, leadership, mission, cash flow, communications, legal systems, and products.
Lesson 7: Know how to choose good people
Partners are very important for business success. "The best way to get to know a good partner is to have a bad partner," said Robert Kiyosaki's wealthy father. Good experience you learned from them.
Lesson 8: Know what property is best for you
There are four types of assets: commercial real estate, paper assets and commodities. To grow, you need to take these classes, choose what works best for you, and practice to become an expert.
Lesson 9: Know when to pay attention and when to mix
You will want to master these four assets, but you need to develop the skills one at a time, because the truth is that if you try to please everyone, it is impossible, and then again. Can make you unhappy with yourself can also be. It's just like investing in these four assets, it is not possible if you want to become an expert all four at once.
Lesson 10: Risk reduction
In investing and in business, there are always risks. Smart investors know how to mitigate risk by hedging. There are many ways you can do this in each wealth class. Learn how to reduce the risk in your chosen asset class.
Lesson 11: Know how to reduce taxes
It does not matter how much money you make, how much money you can save. Taxes make poor people in this area poor. Financially savvy people understand how to use tax codes to their advantage.
Lesson 12: The Difference Between Debt and Trust
Many people, including you, are aware that there are two types of debt: good debt and bad debt. The key to using debt is knowing how to borrow money wisely and how to repay it wisely. Without a plan to pay off debt, you will not have confidence. Financial education involves both understanding of debt and how to repay it.
Lesson 13: Know how to use derivatives
Derivatives are objects that come from other objects. Orange juice, for example, is a derivative of oranges. Your business is a derivative of your ideas. Tax money is a derivative of other assets. There are many ways to use derivatives to create wealth.
Lesson 14: Know how your property is being stolen
There are four things that steal your property: taxes, debt, inflation and retirement. Proper financial education will demonstrate an understanding of how to use the power to steal these assets to make money rather than lose it.
Lesson 15: Learn from mistakes
It is impossible if we learn something without making mistakes. The key is to learn the lessons of those mistakes that keep you from losing this game. More and more mistakes make us aware of how to change and experience, which is a good lesson. Looks like a failure is an opportunity to learn.
Source:
richdad.com
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