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  1. 1. GETTING STARTED Represented by, BINDU LOHIT SUJIT
  2. 2. Rich Dad, Poor Dad Study hard, get good grades and find a high paying job with good benefits is advice from a previous era. Network Marketing is the Perfect Business The richest people in the world look for and build networks everyone else looks for work Robert Kiyosaki, Author Rich Dad Poor
  3. 3. Introduction Robert Kiyosaki, is a multi billionaire by all standards The book basically is about what people must learn and practice in order to become financially independent. The book talks about two different points of view about attaining financial independence (Rich dad Vs. Poor dad) His poor dad (his biological father), was a PhD holder who worked for Government, but never really attained financial independence, while his rich dad (his friends father) did not graduate from high school, but later became a very rich man Parents advice of getting good grades and jobs will not necessarily lead to financial independence, because schools do not equip kids with the information needed to ensure financial independence
  4. 4. Lesson 1 The rich dont work for money Dont work for money i.e. dont depend on your boss to make you rich Learn how to make money work for you by cutting your expenses moderately, investing wisely and creating opportunities to earn passive incomes outside of salaries Seek to be a business owner and/or an investor, rather than an employee
  5. 5. Lesson 1 The rich dont work for money Avoiding the trap fear and greed The rat race - work to spend and spend to have a job is a short term solution to a long term problem The poor and middle class believe that money is real and that the company or government will look after them.
  6. 6. Lesson 1 The rich dont work for money Job Security Financial Security Financial Freedom Ultimate Financial Freedom Wealth Side Rat Race Side
  7. 7. Sample Paths To Financial Freedom Wealth Side Rat Race Side Start Endor Start
  8. 8. Sample Paths To Financial Freedom Wealth Side Rat Race Side Start End
  9. 9. Sample Paths To Financial Freedom Wealth Side Rat Race Side Start End
  10. 10. Lesson 2 Master Financial Literacy Financial intelligence equips you with the what is required to make money that will last for generations, while money without financial intelligence is soon gone Financial literacy teaches that it does not matter how much money you make, but how much money you keep It also teaches that Investments can be made at each income level and if you invest today you will guarantee your financial future Differentiate between an asset and liability, and invest in assets Assets generate income, while liabilities generate expenses; i.e. your GSM mobile phone could be an asset or liability depending on what it is used for
  11. 11. Financial Intelligence Rich Dad. Poor Dads Basic Philosophy Know the difference between an ASSET and a LIABILITY, and only buy assets. A True Asset gives a positive cash flow each and every month. Live below your means, while constantly increasing your means. Make your PASSIVE INCOME cover your Lifestyle Expenses forever.
  12. 12. Financial Literacy Sadly, most of us have been taught to read words and books, but not numbers and financial statements. Two key personal and business financial statements we all must be able to read. The Income Statement shows the amount of money coming in and going out. The Balance Sheet shows the balance of what you own and what you owe.
  13. 13. Income Statement Balance Sheet Income Expenses (Payments) Assets (Own) Liabilities (Debts) Financial Literacy (continued)
  14. 14. Income Statement Balance Sheet Income Expenses (Payments) Assets (Own) Liabilities (Debts) Paycheck, dividends, interest, rents, royalties, profits, advances Financial Literacy (continued)
  15. 15. Income Statement Balance Sheet Income Expenses (Payments) Assets (Own) Liabilities (Debts) Taxes, mortgage/rent, cards, car, food, fun, rent, clothes, child care, insurance, medical Paycheck, dividends, interest, rents, royalties, profits, advances Financial Literacy (continued)
  16. 16. Income Statement Balance Sheet Income Expenses (Payments) Assets (Own) Liabilities (Debts) Taxes, mortgage/rent, cards, car, food, fun, rent, clothes, child care, insurance, medical Paycheck, dividends, interest, rents, royalties, profits, advances Mortgage, car loan, credit cards, school loans Financial Literacy (continued)
  17. 17. Income Statement Balance Sheet Income Expenses (Payments) Assets (Own) Liabilities (Debt) Taxes, mortgage/rent, cards, car, food, fun, rent, clothes, child care, insurance, medical Paycheck, dividends, interest, rents, royalties, profits, advances Mortgage, car loan, credit cards, school loans Stocks, bonds, notes, real estate, business, intellectual property Financial Literacy (continued)
  18. 18. Income Statement Balance Sheet Income Expenses Assets = Zero Liabilities = Zero How The Poor Live They only have small incomes and small expenses
  19. 19. Income Statement Balance Sheet Income Expenses Assets = Zero Liabilities = Zero How The Poor Live They only have small incomes and small expenses $ The Wealthy
  20. 20. Income Statement Balance Sheet Income Expenses Assets Liabilities How The Middle Class Live They buy expenses and liabilities they think are assets Assets
  21. 21. Income Statement Balance Sheet Income Expenses Assets Liabilities How The Middle Class Live They buy expenses and liabilities they think are assets Assets $ The Wealthy
  22. 22. Income Statement Balance Sheet Income Expenses Assets How The Wealthy Live They take the income of the poor and middle class, and buy assets that produce more income Liabilities
  23. 23. Income Statement Balance Sheet Income Expenses Assets How The Wealthy Live They take the income of the poor and middle class, and buy assets that produce more income Liabilities $ Poor and middle class income
  24. 24. Why Teach Financial Literacy? 1. You must know the difference between an asset and a liability and buy assets. 1. The rich buy assets but the poor and middle class buy liabilities they think are assets. 2. The cash flow pattern of an asset is from Assets to Income. (pg 60) 3. The cash flow pattern of a liability is from Liabilities to Expense.
  25. 25. Why Teach Financial Literacy? 2. The financial nightmare 1. hard working educated couple marries and begins their careers. 2. decide to save for dream home, and so work hard to make more money taxes go way up. 3. They buy their new house and furnish it, and now have property taxes, mortgage and credit card debt. 4. Kids come along who cost money and so the parents work harder and up go the taxes.
  26. 26. Why Teach Financial Literacy? 3. As an employee who is a homeowner: 1. you work for someone else and are making the owner(s) or shareholders rich. 2. you work for the government, from Jan to May to pay your taxes 3. You work for the bank, paying off your mortgage, student loans and credit cards.
  27. 27. Why Teach Financial Literacy? Remember this simple observation: The rich buy assets The poor only have expenses The middle class buys liabilities they think are assets
  28. 28. So why not? There are five reasons that people dont grow assets and become financially independent. F ear of losing money Cynicism dont let doubts paralyze Laz iness busy people are often the most lazy Bad Habits our lives reflect our habits Arrogance arrogance + ego = ignorance
  29. 29. Conclusion The author concluded by stating that parents should teach these lessons to their children early enough, in order to guarantee their childrens financial future It is never too late to start building your financial empire. You could start right now, with your next pay check, or by looking around you, to see which need you can fulfill
  30. 30. THANK YOU