Passive Income

Robert Kiyosaki

According to Mr. Robert Kiyosaki‘s definition, one that generates positive cash flow is an asset. It is a liability if it does not generate any income, A car is liability if it does not generate a positive cash flow unless the car is rented out and the monthly rental is income, I will need to calculate to determine whether it is an asset or liability.
Firstly, I need to subtract the monthly repayment of car loan and maintenance costs from monthly rental income. If I get the result is positive, then it means that the car is generating a positive cash flow, thus it is classified as an asset. However if the result is negative, then it means that the car generates is giving a negative cash flow and therefore it is classified as a liability. Based on this new definition of what is an asset, I understand that if I can build up my wealth, I must have investment only in assets that can generate positive cash.
But is it that simple to just invest in any assets that generate me positive cash flow? When I invest in a business that is generating positive cash flow and all my time were taken by this business, then is this considered a good investment? Since I have no time and energy to think of building other sources of income, I do not think that this is a good investment. It is also like I must be working hard on this business. At any time when I was away and not on this business, my business could not sustain the results, then this is not the business that generates passive income.







Build A Business That Generates Passive Income Now!

Passive income on the other hand does not require me to work actively for it. I can build a business that can run on its own. Even when I am not around, the business will run because there is a system.Alternatively, I invest buying an asset that generates passive income. Basically I can leave it running on its own with little or no intervention on my part. For example, I could invest by buying property and renting it out. The only task that I need to do is just to collect monthly rental. The passive income derives from property means that I am an investor. This switch from active income earner to passive income earner is based on my understanding from the book Rich Dad Poor Dad by Robert Kiyosaki.

For Your Financial Freedom

Lay Peng

http://www.videeoonlineseminar.com/






http://www.topspeakeronline.com/blog

P.S: Mr. Robert Kiyosaki has his Rich Dad as his mentor while I have him and other Top Speakers and World Class Gurus as mine.

**** DISCLAIMER *****

The author, publisher and distributors particularly disclaim any liability, loss, or risk taken by individuals who directly or indirectly act on the information contained herein. All readers must accept full responsibility for their use of this material.Copyright © 2007 topspeakeronline.com/blog