We Share Ideas Cash Flow Quadrants Financial

We Share Ideas

Cash Flow Quadrants Financial Freedom? Business Employee You have a job Self. Employed You own a job We Share Ideas C I EB Owner You own a system and people work for you Investor Your money works for you

Cash Flow Quadrants Employee Business Owner Self. Employed We Share Ideas Investor

How Can We Build Wealth in Three Quadrants? B O Business wner Owner SEelf. S elf- mployed Employed We Share Ideas Investor Your money works for you

What is Money, Anyway? • • • A medium of exchange that is socially and legally accepted in payment for goods and services and in settlement of debts A standard of value for measuring the relative worth of different goods and services A “factor of production” We Share Ideas

The Dynamics of Money Machinery Materials Manpower The purpose of a business is to create wealth for its shareholders Production Operation Output (products or services) Profit Investors Lenders We Share Ideas Money

The Dynamics of Money Employee Version Machinery Materials Manpower Production Operation (products or services) You get a job Dividends & Increased Value You buy Stock Investor Lender You buy a Bond We Share Ideas Money Bank Interest You buy a CD or deposit $ Output

The Dynamics of Money Machinery Materials Manpower Investor Version Production Operation Someone Else’s (products or services) Dividends & Increased Value Investor Lender We Share Ideas Money Interest Output

The Dynamics of Money Machinery Materials Manpower S al Business Owner Version Production Operation (products or services) ar Dividends & y Increased Value Investor Lender We Share Ideas Money Interest Output

Expect of Your Business: • • Salary commensurate with your “opportunity cost” – what you could earn working elsewhere doing something similar Dividends/distributions @ reasonable Return on Invested Capital rates Interest income @ reasonable lending rates Adjust for risk We Share Ideas

Invest the Money • • In other businesses (stocks) In Income-producing Real Estate In Interest-bearing Bonds (of other businesses) With a Fee-Only Investment Advisor – No Products – No Commissions We Share Ideas

We Share Ideas