Are you struggling to find the answer to an important financial question? It is possible to find the solution to practically every money problem if you read extensively, concentrating on material that can educate you about personal financial success.

Over the past weeks, I have introduced you to several books and CDs that have helped me to learn the essential principles of money achievement. Just like physics, accounting or other subjects that you learn in school, money is governed by basic rules that dictate how you should manage, multiply and maintain it in order to attain financial success.

There is no magic solution that can help you to accumulate the wealth you desire; no perfect investment or sudden windfall of money will instantly turn your money situation from desperate to desirable. To obtain long-term financial security and freedom, you must first learn these money principles, and then apply them consistently over time.

The elusive quest for financial freedom

As a money coach, I meet many people who are looking for ways to improve their earnings; some who even express the desire to find out how to become rich. The saying ‘Many are called, but few are chosen’ might be applicable to most persons’ search for wealth, as statistics show that only a small percentage of the population will ever attain true and lasting prosperity.

The mystery of why some persons are able to work less, earn more and attain financial security, while others struggle with money had puzzled me for many years. Philosophers, economists and social scientists may offer various reasons for this disparity; however, it was a simple sketch that I found in an intriguing book that finally solved this riddle for me.

In Rich Dad’s CASHFLOW Quadrant, Robert Kiyosaki described what was really required to attain financial freedom. The CASHFLOW Quadrant represented the different ways that people earned money, and it provided the key to why some people could work and create wealth while others would just continue to work hard.

Where do you earn your income?

The quadrant was illustrated with a vertical line intersected by a horizontal line. Each quarter of the quadrant had a letter; top left: E, bottom left: S, top right: B, and bottom right: I. The letters stood for employee, self-employed, business owner and investor. “Each of us resides in at least one of the four quadrants,” revealed Kiyosaki. “Where we are is determined by where our cash comes from.”

Each sector of the quadrant represented different pathways to income generation, Kiyosaki explained. Employees earned by working for other people, self-employed persons created an income by working for themselves, business owners generated profits from owning business systems, and investors used their money to earn more money for them.

Kiyosaki noted that it was possible to exist in either quadrant regardless of your occupation, as it was not what you did, but where you generated income that mattered. For example, a teacher could work as an employee, be self-employed and offer private tutoring lessons, form a school and hire other teachers, or channel money into various investments and earn an income from them.

Security, perfection or freedom?

There are different technical skills, mindsets, and personalities required to be successful in each quadrant, Kiyosaki pointed out. People respond differently to their emotions about money, he clarified, and their emotional responses often determined which quadrant they chose to generate their income from.

The emotion of fear is dominant in the ‘E’ quadrant, as most employees have a strong need for security of income, and place emphasis on having jobs with great benefits. Self-employed persons do not like to be dependent on others for an income. They are usually perfectionists who like to do things on their own, as they don’t believe that anyone else can perform up to their standards.

True business owners are actually opposite to ‘S’ quadrant earners, Kiyosaki asserted, as they like to delegate tasks to competent employees. A business person owns a system, not a job, and is effective at leading people. Investors don’t have to work, as their money works for them. If financial freedom is your goal, you can only achieve it by creating income streams in the ‘B’ and ‘I’ quadrant.

Wealth comes from the right side

Kiyosaki’s definition of wealth is “the number of days you can survive without physically working and still maintain your standard of living.” He contended that wealth was measured in time, not dollars. Therefore if your expenses are $50,000 per month and you have $150,000 in savings, then your wealth is about 90 days or three months.

The key to attaining wealth lies in your ability to earn an income that is independent of your work efforts, Kiyosaki noted. “Regardless of which quadrant people make their money in,” he maintained, “if they hope someday to be rich, they must ultimately come to the ‘I’ quadrant.”

If you are searching for strategies to create long-lasting wealth, I recommend reading Rich Dad’s CASHFLOW Quadrant.

Please email cherryl@financiallysmartonline.com if you wish to find out where to get the books that we have been recommending for your reading list.

Cherryl is a financial consultant and money coach, and founder of Financially S.M.A.R.T. Services; she is currently writing her first book, “The 3 Ms of Money.” Get more practical financial advice at www.financiallysmartadvice.com and free financial tools at www.financiallysmartonline.com.