Rich Dad Poor Dad Lied To You

So it turns out rich dad, Poor dad was wrong. And I'm going to tell you why. And I'm going to tell you how to use our investor matrix to get into millions. That's the goal. I think rich dad, Poor dad has done things incredibly well. But I think he's misleading a lot of people with the way that he talks about his cash flow quadrant. So in 10 minutes or so, we're going to break down for you exactly why Robert Kiyosaki is a little bit outdated on this. Despite the fact that he sold 32 million books and is worth more than $100 million, I'm going to come at him today and I'm going to say he got it wrong, kind of. And let me explain why. First of all, the reason that this is important is because if you get this right, this is how you truly become financially free. This is how you truly know that you're progressing towards freedom. Sometimes people will ask me, what is financial freedom? Is it a number like 20 million? My fu fund? I say no. Is an employee type, like business owner versus employee? Also no. Is it cash flow, as in how much of it you have or don't have? Also no. It's not a number. It's not a type of worker you are. It is where you sit on what I'm calling the investor matrix. You see, there are four types of people in the world. We are all one of them. To truly achieve financial freedom and mastery, you have to know where you sit. I'm going to explain it to you. It took me the better part of a decade in investing in finance and working on Wall street and PhDs and MBAs to learn this. But it started with rich dad, poor dad because he talks about becoming wealthy in the realm of self employed versus business owners versus investors versus employees. You can see it here on his cashflow matrix. The one sentence summary is he tells you that you need to move from employees to investors. Okay, that sounds pretty good in theory, but something bothered me so I thought, what is he missing? Well, really, he's just telling you how the IRS labels you. He's telling you your taxation status. That is maybe step one in financial freedom. But it's far from the closing of the chapter. It's just a label. And that actually doesn't make you more money, which is what we're actually into. Instead of obsessing about Whether you're a W2 or have K1s or a 1099, we need to think about how to progress in a financial literacy, which sounds boring except it makes you a lot of money. Because the truth of it is it is a total fallacy that you can't be a worker and be a billionaire or massively financially free. Just ask Sheryl Sandberg. W2. Just ask 54 of the 400 Forbes billionaires who are employees, not owners. Just look at all of the billionaires who bought out the companies they worked for and got equity at the companies. Just ask all the W2s of large corporations who pay themselves $1 salaries and thus avoid taxation. Your W2 status has nothing to do with you being financially free. Nothing. Sorry, Robert. I think you're wrong. And here's my first iteration of what I think is right. What do you actually pursue? And it's something I never named previously, but I use to amass my wealth in the 124 conversations I've had with 8 and 9 figure net worth humans, what they told me is they don't care about their tax status, they care about their investor status. So if you want to climb the pyramid, I think this may help you. All right, here's the framework. Investor matrix is divided into four types of people. Inside of each category is a slide scale. But let's simplify to four. We've got spender savers, general investors, calculated investors, master allocators. On the left side of the matrix are the S's and the G's. Those are the spender savers and the general investors. Now on this segment of it, these people, they know the least about investing. They pay the most in taxes and they have the least financial freedom. But each is a little bit different. The spender saver or the S brings in money, thinks he's using it. That's really using him. He buys liabilities like cars, houses, vacations and things to fill the houses, cars and vacations with savings. Whatever money is left after earning goes into savings account, which is good. Bravo guy. But he doesn't realize that it's not keeping up with inflation or is just purchasing the next thing. So he feels like a hamster on a wheel. Right? Also, this comes with a vanity. Somehow looking rich has become more important than being rich. Feeling financially secure is more important than becoming a master of money, not smart. Lastly is non fluency. The S's work hard for money because they don't truly understand it. They have to keep working for it because they don't know how to make it work for them. Now before you go, those guys are idiots. This was me for many years. I was working investment banking, living life. And at the End of the day, not having much to show for it. It's okay. Everybody starts here. Second one G is for general investor. Here are the characteristics of a general investor desire. People in this quadrant have started realizing they need to invest because they desperately want freedom. They want to escape having a job or taking on a client or not being able to move if they want to. Second Reliance. People in this group invest in things like the stock market with their financial Advisor. They pay 1% for her to figure it all out, and they just leave it in her hands. If I were to ask them what they were invested in across the board, they wouldn't know. Or if they did, they wouldn't know. Why does that resonate with you? Maybe you're sitting here. The next is fomo. Because you feel like you have this deep need to be free, you can sometimes get talked into get rich quick schemes like day trading, crypto strategies, throwing money into crowdfunding or angel list. This is where most people sit all of their life, this level. Never quite free. Oh my gosh, you guys, I just had the end of my fiscal year, which basically means I paid taxes, which is the worst thing ever. But you know how bad taxes are with one business. Now imagine that you have 26 of them. It's awful. It's so awful. I use the software called Bench and I was sitting there doing all my taxes. They made it so much easier for this year, handled everything. And I was like, wait a second, I now owe my accountant so much money for this. Why don't I call Bench up and see if they want to sponsor this video? Because since they already do the taxes for everything, they can help offset my bill. And also, I love the company. So it's like a twofer. It's a one for two. It's one for 26 actually, is the math. So anyway, I only talk about stuff I love. I love the software. You guys can check it out here. Basically what you do is they create a monthly P and L for you so you don't have to have a CFO in your business. Looks like this for mine. They do it for a bunch of my businesses. Then they also will file taxes if you want them to, for your business or 372 businesses that I have. But thanks, Bench. I called you guys up. You actually picked up the phone. Then you sponsored my video, then you put in my taxes. I don't. I love you. I'm married, but I love you a little bit. Anyway, check out Bench guys. Then you get on the right side of the Contrarian investor matrix. And on the right side, or the tippy toppy, are the C's and M's. They pay the least in taxes and create or invest in assets that produce cash flow for them even while they're sleeping. We call that passive or horizontal income. Each is a little bit different. The C stands for calculated investors. Unlike Those in the GS, they allocate money and they do it strategically. The first characteristic is education. If you have educated yourselves on how investing, finance money, taxes and various asset classes work, you might be in this category. You understand the language of money, the terminology, how to use it. You could smell bull and never blindly trust another with their finances. You do your own due diligence. The third characteristic is they know their financial picture. You know your net worth, you have that number and you track it. If you don't know where your money is, it turns out she'll leave you. The third is strategy. You have a strategy for your money, so you know where you want to go, what you need to do to get there. And you have a roadmap how to achieve that goal. And lastly is a system. So you have a system to ensure that the destination that you're going to get to, you have tools to reach it. Team software tracking this might be mean working with the right tax, financial advisory, real estate professionals on a continual basis. So in this level, this is the first level, where the money starts to do the work for you. Most people are not here yet. Then this last level is called master Allocator. This is where we want to be if we want to be truly generationally free. From a financial perspective, allocators have the most knowledge and financial education of all the matrix investors. They also have the highest net worth because these are the truly rich. Here are the characteristics. Tell me if this sounds like you. Expertise. While the Cs have education, Ms. have expertise. The difference between education and expertise is the difference between a high schooler and a PhD. You understand investments, taxation, structures, deal making. You have a niche and often are the person people go to when they think about investing in that space. The second is access. So due to your expertise, you get unfair access into deals, opportunities, research, insights. This means that you get returns that most people don't. Then we have trust. All of this leads to trust. When you're an expert, you put your money where your mouth is and you share that with others who want to hear from you. And that gives you the final thing, which is leverage. EMs become allocators or syndicators because people Trust them their expertise and their access. They give them money to allocate to invest for them. This creates leverage and the M's then make money when their investments do well. But even more than usual, as you don't have to use just your own money, you get other people's on top of it. Now, when you're a master allocator, 99% of the work is done by your money. Anything else you do for the love of it, and you kind of think about money like an employee. So our goal at Contrarian Thinking is to push as many people to this level of master allocators. Because as we see the world around us continue to punish those who aren't financially free. It's time to raise awareness of what it means to actually create financial freedom. How do you figure out how to overcome inflation at all time highs, wage stagnation, increased taxation? You become an allocator. Now, listening to this, you probably know where you are. You probably have an inkling, and that's the first step. Because you don't know which staircase to climb if you don't know where you're standing. So now that you're on the right path, you can Forget about your W2, who fucking cares and turn instead to do you understand enough about making money that other people can start to treat you as an expert, that you can start to get unfair access, expertise and allocations. So with that, I hope you like this video. This one's a little bit more tactical. The goal with this video is actually to take you and move you on your financial journey. It's about you. It's not about some guy doing X and Y and Z. It's about taking you from the place you're at today to the place that you want to be. Question everything, and we'll see you next week.