Can you guess how much Amazon paid in corporate tax? The answer is zero and it is legal. In fact, the more jobs the business generates, the bigger the incentives are offered to them. The reason for this is because governments give incentives to large businesses for creating job opportunities. Those that own a big business, having at least 500 employees or more, are only paying around 20% in taxes. The Advantages of Being on the Right Side of the Cashflow Quadrant You may earn a lot but still not as much as big business owners and investors.You pay 40% – 60% of your income in taxes.To summarize, the disadvantages of being an employee or being self-employed are: This means that nothing is compounded over time. If you’re self-employed, you also start from zero everyday. If you’re self-employed or if you own a small business, you might think that you’re in a better position but you’re actually paying much more in taxes, up to 60%. This doesn’t just apply to the United States but everywhere in the world. Just that already says a lot.Īccording to Tom Wheelwright, the tax advisor of Robert Kiyosaki himself, the average amount of tax that an employee pays is around 40%. Time is the most valuable resource in the world and every minute you use is a minute you can never take back. Regardless of the amount of money you are being paid, it can be a disadvantage for you if time is the sacrifice. The reason for this is because you are the best person who can do your job. This is because you can’t delegate every task if you’re a small business owner or a specialist.

If you are self-employed or if you’re a specialist (doctor, lawyer, etc), you are still actually paid in exchange of your time. For employees, you are being paid in exchange for time. If you are already an employee or if you’re self-employed, you should know the advantages that you enjoy.

The Disadvantages of Being on the Left Side of the Cashflow Quadrant Here’s to give you more insights about the advantages and the disadvantages of being on the left and right side of the cashflow quadrant. However, if one wants to gain even more wealth while paying less taxes, they need to decide to transition from the left side of the quadrant to the right. While this may be the case, this doesn’t mean that one can’t be wealthy being an employee or self-employed.

On the right, other people or the money itself works for them.

You don’t have to exchange your time for money being a big business owner or an investor.

Otherwise, they could end up in a financial crisis.

Those on the right can’t leave their jobs or business for too long.

Those on the left side earn less money, those on the right pay more.

Those on the left side pay more taxes, those on the right pay less.

Here’s why being on the right side of the cashflow quadrant is better. The idea of the cashflow quadrant is that the ideal place to be in is at the right side. On the left side are the employees (E) and the self-employed (S) and on the right side are the big business owners (B) and the investors (I). With the four types of people, the cashflow quadrant would then look like this: The self-employed, those that owned a small-business or are specialists (S).Robert mentioned how there were 4 types of people in the world of money or business. In the book, Robert explained the cashflow quadrant which was told to him by his rich dad, his best friend’s father.

Robert Kiyosaki is the author of “Rich Dad, Poor Dad”, the number 1 personal finance book for the last 20 years. The Cashflow Quadrant of Robert Kiyosaki

4 cashflow quadrant