You have probably heard of Robert Kiyosaki author of the famous 'Rich Dad Poor Dad'.
He appears to share my same views in relation to Buy and Hold and Hope, although I never used the "D" word. Only D word I used consistently is DENIAL.
Same message: Start Planning Now, Failure to Plan is a Plan is Failure as they say. No time for Denial.
Coming Depression Will Cause Greatest Wealth Transfer In History
By Robert Kiyosaki (author of Rich Dad Poor Dad)
Bold and Red Emphasis my own
Scottsdale,Arizona November 13, 2018
We had a big crash in 2000 and then in 2008, which I predicted. The current bull market is the longest on record by some definitions. Another full-blown crash is just a matter of time. And it’s going to be the biggest of all.
The global economy is an enormous credit bubble that was reinflated after 2008 by historic low interest rates and quantitative easing. Once it pops, the world could be plunged into a new Great Depression. While I don’t know when it will happen, it will devastate baby boomers.
It will be like an avalanche.
The foreshocks are sounding right now. We’ve already had two substantial sell-offs this year and we’re seeing major swings in the market.
Yes, a depression is coming. The world is waking up to this fact.
The good news is that in every crisis there is also opportunity. The greatest opportunities to invest occur when things are at their worst. The ultra-rich know that and have always profited from the market’s swings. This coming depression will be the biggest wealth transfer in history.
This is your opportunity to become rich.
I’m optimistic I am going to make even more money when the next crash comes. That's because I make most of my money when the markets crash. I made a lot of money in the subprime crash, for example. I got great bargains.
But unfortunately for most, those who are not prepared will not fare quite as well. By planning ahead of time, you don't have to be one of them.
Don’t just learn how to recognize a looming crisis but, more importantly, how you can make money from it. In order to do that, you must be financially educated.
You must first stop gambling with your future.
I'm talking specifically about the passive strategy of “buy, hold and pray” almost almost guarantees you’ll lose money.
It gives you no control over the outcome of your investments.
One of the reasons people do not become free is because most of them are focusing on capital gains rather than cash flow.
Chasing capital gains alone is gambling — not investing.
“When you invest for cash flow,” my rich dad said, “you’re investing in a money-back guarantee. If you invest for capital gains, you invest in hope. The biggest thief of all is hope.”
One of the reasons I was able to retire at age 47, and my wife Kim at 37, was simply because we had enough cash flow coming in.
It wasn’t much — about $10,000 a month — but we only had about $3,000 in monthly expenses. That left us with $7,000 a month to do with as we pleased.
Cash flow means passive income and that means one thing to me: FREEDOM.
I’m free to do what I want, whether it’s to have a life of leisure or pursue a new business adventure. I am free to be with the people I choose. I’m free to set the schedule I want. My time is truly my time.
My No. 1 goal is to always have more cash flow coming in than going out for my expenses. When I do that, I’m free. My assets work for me, instead of me working for money.
On the other hand, capital gains are when you buy a stock for a dollar and it goes up to $10, so you make $9 a share. Or you buy a house for $100,000 and it appreciates to $150,000. You sell it and make $50,000.
Most retirement plans are based on these hopes and promises stretched over many years. That makes very little sense to me. It all comes down to hoping the money you expect will be there at age 65.
But these types of investments are anything but guaranteed. Want proof? You don’t have to go back very far to find it — just 10 years:
American’s 401(k)s and IRAs lost about $2.4 trillion in the final two quarters of 2008. Homeowners lost a cumulative $3.3 trillion in home equity — this is why your house is not an asset.
Again, this is gambling. Don’t be a victim of the coming avalanche.
Money is a powerful force. Unfortunately, people use the power of money against themselves.
To be a master of money, you need to be financially intelligent.
It all starts with financial education.
You must understand how to make the wealth-stealing forces of taxes, inflation, debt and retirement work for you — not against you.
In order to be rich, you must pay yourself first. By this, I simply mean using your income to invest in cash-flowing assets before you pay your bills or buy anything fun. This in turn will create more income that you can use to invest in more, cash-flowing assets.
Do that and you’ll have more money than you know what to do with.
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