Rich Dad Poor Dad | S5 – E12 | Assets vs. Liabilities | What’s Your Cash-flow Pattern?

Are you a poor, middle, or rich cash-flow possessing individual?

Well, let me try to break this down in blog form. If you want the amazing podcast, make sure you scroll down to the bottom for it.

Cash-flow of a poor person

Your job gives you your salary, which then goes to your expenses: taxes, food, transportation, clothes, etc. That’s all you have. You have zero assets, and fortunately, you have zero liabilities.

Cash-flow of a middle-class person

Your job gives you your salary, but instead of going to expenses, it goes down to your balance sheet in the category titled “liabilities.” This has your mortgage, car loans, credit card loan debt, school loans, etc. After you pay for your liabilities, then the remaining money goes back to your expenses: taxes, etc.

Cash-flow of The Rich

You do not have a job or salary. Better yet, your money starts in your balance sheet in the assets category which has real estate, stocks, bonds, notes, intellectual property. Those assets never get paid with liabilities. In fact, it goes back up to your income statement, which is the rental income, dividends, interest, and royalties. The only monthly expenses you have are taxes and a possible mortgage payment.

Which one are you?

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