Many of us have already heard of the cash flow quadrant by now. If you haven’t, here is a breif overview; You can decide which one your in and which one you want to be in.
This is a very simplified version but you will get the picture. Now in the world of money there are essentially 4 types of people; which is explained by the cash flow quadrant.
There are 4 categories, the E which essentially stands for employee. The S, for specialist or self employed. The B for big business. And the I for investor.
The E
The E quadrant, which makes up for a large percentage of most societies, up wards of 80 percent represents the employee. The employee prepares the best resumes and arguably has some of the best skill sets and are highly competent and technical individuals. They work for their money and trade hours of their lives in exchange for their pay checks. Much of their lively hood is exclusively dependent on their ability to perform at a high level consistently. They hunt for high paying jobs packaged with a strong set of benefits to complement their career. Employees are integral part of any society and are essentially the corner stone of the economy.
The S quadrant
The S quadrant stands for specialist or self employed. In society these individuals are doctors or lawyers, or small business owners who work on their own terms. The S quadrant is slightly more independent and less dependent on governments and companies to take of them. They like to get things done on their own so they can do it exactly the way they want it done. Like the E quadrant they too are very smart individuals as well. But essentially they also trade their time for money.
The B quadrant
The B quadrant stands for Big business. This quadrant essentially consists of entrepreneurs. Individuals in the B quadrant are individuals who, unlike the S quadrant who like to get things done them selves, work to hire smart people to guide business decisions. Now the main difference that the B quadrant has with the E and S quadrants is that people in the B quadrant do not work for their money, they can earn income without having to work on a consistent basis like the E and S quadrants.
The I Quadrant
The I stands for investor. The individuals in this quadrant are people who do not work for their money but have their money work for them, a good example would be Warren Buffet who has most definitely left his legacy as one of the greatest investors of our time.
Now it would be wise to mention that much of today’s wealth lies within the right side of the diagram shown above, but much of the population is on the left side of the diagram. This is a very brief over view of the cash flow quadrant, the book Cash flow quadrant goes into much further detail. I recommend you pick it up from your library and have a read. Now the question is what quadrant are you in? More importantly what quadrant would you like to be in? 
Filed under: Uncategorized
