How to be self sufficient based on the theory by Roberto Kiyosaki
The idea was that we normally tend to ensure that we keep our liabilities paid off we start or even think about investing in our own assets. It is true that we really need to pay off our liabilities and expenses to keep them off our back. However, isn’t it also true that we need some money in our own pocket at the end of the day so that we can actually grow the money in order to retire peacefully!
Should we actually be paying off and paying off till the end of our life or till we retire, sometimes even after that and not making anything out of our earning for ourselves and our family!
The argument is perfectly logical and commendable. Why did I not think of that! So, what does Roberto Kiyosaki propose that we do about such an issue?
Well, in order to be self sufficient, we need to save from our cash inflow. This could be commissions or wages or whichever way money finds your pocket. You need to dedicate a certain percentage of the total amount, say 30%, to your savings account. The remaining 70% is to be used to pay off whatever you have to settle.
If your inflow is $1000 and your liabilities and expenses add up to $1100, you must still save $300 from the amount and pay off the $1100 liabilities and debts with the remaining $700 you have left. No matter what, you must not even think about breaking your savings piggy bank. Once you have a substantial amount you can invest and start growing your money.
You will notice that you will have deficit in your account to pay off your liabilities and expenses. However, you must be ready to face this and negotiate with the parties concerned to let you pay back in smaller amounts. As long as you are settling part of the money, most creditors will be willing to accept your request. Once your investment grows, you can actually be affluent enough to pay off your debts in full, even.
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