Ever thought why around 99% of people spend their entire life living paycheck to paycheck and still fail to enjoy royalties like successful people?
How successful people build smart systems that pay them for their lifetime?
In this book summary i'll throw light on such questions.
the best part is, anybody can learn these simple lessons and use them to become wealthy by the end of this book summary you will have a different mindset about money. you will understand the psyche behind wealthy minds.
So without wasting any time, let's get started!
Lesson #1
jobs that trade time for money are not reliable in the long term!
most people run after jobs because they provide paychecks, jobs provide money to pay monthly bills. that's the logic right!
but there is a big problem, jobs ask you to trade time for money, the more time you spend the more you get paid at the end of the month.
you might say well it's okay that's not a big deal the point is it seems good as long as you are trading your time but what if you become incapable of trading your time due to some kind of sickness or injury what will you do in your old age when your muscles won't be as strong as they are now?
you can't always be working all the time, so it might be a good strategy to get money by doing a job in the short term but the moment you stop working your entire lifestyle takes a big hit also once you get tuned to a certain lifestyle it becomes harder to adjust.
let's say you are doing a job and you get twenty thousand rupees per month.
now, imagine if due to some problem you stopped going to your office for a few days. your salary will be affected. your angry boss may even fire you and get someone else on board but, since you are used to spending more money on fancy products or subscriptions, you will struggle to adjust to the new lifestyle.
what if your company starts firing its employees due to some random market crash?
your salary would instantly become null, right!
Again, imagine!
what if you are a teacher and your eyesight becomes weak after an accident. you won't be able to teach then, right?
if you don't have a reliable system that pumps out cash sustainably you should start thinking about it sure you can argue that those are all imaginary scenario. but a wise person always has plans for the worst case.
let me tell you an interesting story that the author has discussed in this book
Lesson #2
the day you stop working, the flow of money stops!
in this book, the author shares an interesting story of two friends pablo and bruno. both had the same job of delivering water to every home in the village. so, pablo carried lots of buckets and got paid immediately.
he was happy carrying buckets surprisingly bruno was a smartie. he built a pipeline half of the time and used the remaining time to carry buckets. bruno was getting paid less compared to pablo as he spent most time carrying buckets. but, once bruno's pipeline started delivering water pablo got out of business.
people then didn't have to wait for any person to get water. it was delivered systematically through the pipeline system. all the village people had to do was to turn their taps on. pretty amazing isn't it so who is the winner here?
yes! it's bruno. he had a long-term vision. it was risky to do something that nobody was doing but that's also the reason that bruno got rich and got the most profit out of his pipelines.
the author says, that there are two types of people in this world-
"BUCKET CARRIERS AND PIPELINE BUILDERS"
sadly most people have the mindset of pablo they get paid only when they carry buckets. if they want more money they will have to work harder and carry more buckets.
but the people who have the mindset of bruno, work smartly. they build systems once and reap the money for their entire life. it's called passive money.
bucket carriers have an active income but the pipeline builders have multiple sources of passive income.
does this mean they don't have an active income?
not at all!
the best strategy is to have an active income and build a source of passive income so that eventually get freedom from trading your time.
Lesson #3
it's hard to convince people to build systems instead of living paycheck to paycheck!
no matter how cool the idea of passive income or pipeline building is sadly most people would never accept this idea and there is a big reason for that. there is a thing called social proof.
since most people love living paycheck to paycheck we think that they must have thought properly and how can everybody be moving in a wrong direction or be deluded.
but, that's not true!
just because everybody is thinking about a job it doesn't mean that it's the only way to live a prosperous life.
the author is not against jobs, he is against the idea of deluding ourselves and thinking that a job is the most secure thing when it's not the best way to play safely is to build a system that can generate money or if you put in the words of robert kiyosaki build assets that put money in your pocket the idea of building systems is about building assets that pay you passively.
this way you won't have to trade your time for money all the time.
Lesson #4
the more you earn the more lavish your lifestyle becomes and the harder it is to escape from it!
another problem with the bucket carrying mindset is it's for the short term once the money starts coming into your bank account you suddenly become more interested in buying liabilities. but, it doesn't make sense right!
yes! but, unfortunately billions of people do this every day. the reason is liabilities are appealing, they provide instant gratification. that's the reason most people don't see any problem with jobs. they think that they are getting the money things have been fine.
so, why put extra effort and guess what happens?
Their wealth doesn't multiply or compound with time. there is always a trade of time for money but their spending habits surely dothe more you spend the more you have to work and therefore the more time you will have to trade the precious time which could be spent building pipelines or systems is wasted working or paychecks.
Lesson #5
never underestimate the power of compounding!
the author shares the secret of successful people in this book, the secret is COMPOUNDING!
but it doesn't work for narrow-minded people who believe in instant gratification.
they give up too early on the flip side rich people stay patient for years.
they invest early in quality stocks or some other assets and allow them to compound over time. initially, it's a small figure but with time the power of compounding start and you become wealthy over time.
of course! you should not be spending mindlessly too much while you invest, that's the only condition.
Lesson #6
The only limit to our growth is the one we put ourselves!
there is no limit to how much can a person's wealth grow.
yes, life is unfair and not all people are born rich but, there is always room for growth after the revolution of the internet, there are lots of options like starting your blog, providing services etc. that can help you build assets but most people get stuck with a narrow mindset and don't even dare to explore the possibilities.
the truth is most people don't even have enough patience to sit and plan about building a money-making asset. they delude themselves that their job is enough to live a good life. so, they don't even take the first step towards financial freedom. this doesn't mean that jobs can't make you financially free. if you are smart enough you can even grow assets while having a job.
Lesson #7
leverage your time, effort and money to build more pipelines!
the author says that we all have the same 24 hours every day.
how you spend these hours and what choices you make, determines how successful you will become? the author talk about leveraging our resources and our most precious resources are time, money and energy.
successful people are cautious about where they spend these resources? they don't just waste their time,watching tv serials like squid games, just because they are trending!
yes! they make deliberate choices like-
which stocks they will pick?
who they will allow in their inner circle?
which books they will spend their free time on? etc.
while average people go with the flow. they do what gives them pleasure. building a pipeline takes time and effort, that's why you must leverage your time and money.
Lesson #8
Have enough pipelines to ensure your safety!
the real security is in building pipelines. the author says pipelines are your lifelines. if you have five to ten pipelines then you don't even need to worry about your finances. only by building systems that keep paying will you be able to become financially free.
as we discussed, most people mistakenly see safety in bucket carrying jobs where you trade your time for money so the idea of building systems doesn't even cross their minds, and if it does they don't believe that they can achieve it.
Lesson #9
encourage other people and make them realize the power of systems and compounding!
the best way you can help a person financially is by educating him or her about building assets and systems.
it's like teaching a person how to catch a fish. sure, it's easy to give a person a fish but by doing that you will only help him one time when you teach someone a process you help him infinite times. you make that person independent this opens up doors to multiple opportunities the goal is to grow together. isn't it?
so don't keep this secret to yourself, share with your friends too!
i highly recommend you purchase this book to learn more about wealth creation there is so much you can learn from this book!