The last time round, we discussed about “Understanding the Financial World – The Employee“.
Have you discovered which quadrant do you belong to?
Once again a quick recap on the cashflow quadrant:
Employee: People who earns a monthly income or an hourly income. These people reports to a company, a superior or a boss. In essence, employees exchange their time for money.
Self Employed: Both the boss and the employee. Doctors, lawyers, actors. Also pretty much known as small business owners.
Business Owners: Owns a big business as a business owner. Company has about 300 – 500 and above employees. Leveraging on other people’s time and efforts.
Investors: People who invests their money to generate money for them. Investments such as real estate investments, stocks, commodities, etc.
So today, we are discussing about…
The Self Employed
Although slightly different from the bulk population of employees, The Self Employed isn’t all that much different when it comes to exchanging their own time for money. In fact, it may be even worst.
Consider the following: An artist, a doctor, a small shop owner, financial planner, and real estate broker.
They operate when they like to, and so does their income – only comes into their pockets when they work. Which… seem quite reasonable, after all nothing comes for free. Really, is that the case? Imagine if the small shop owner falls ill for a week – what happens? Income stops. How about a holiday? Income stops again.
So you might also think… in that case being an employee is better, because of the security, which by now we know given the turbulent global economic crisis is churning – pretty nothing is secure and risk-free any more.
So why self-employed?
- Comparatively higher income potential than employees.
- Determines their own income
- Manages own time
- Potentially long and crazy working hours
- Zero leverage on both time, effort and money.
As time goes by…
Both the employees and self-employed
- Pay the most taxes
- Trade their time for money; longer working hours, more money earn
- Struggle due to increase cost of living
- Struggle due to jobs scarcity and high competition.
- Heavily dependent on Economy. (If economy rises, demand for people’s time rises.)
Now isn’t that tiring and risky as well? To be the Superhero that drives all that income by own personal time and effort.
Let us recap, who are the self-employed?
- Doctors, Dentists
- Actors / Actresses
- Small shop owner
- Financial planner / consultant / adviser
- Real Estate Broker
And the big question in life? What do you want? If you could have anything in your life, what do you want? How do you want your lifestyle to be like? It really depends on these questions to determine what works best for you.
For me personally, I want my life to be life. Where I spend my time living, reaching for goals and achievements, having fun and living to my fullest, contributing back. Each minute is 60 seconds gone. I may be overly optimistic that I may live to 100 years old, but the truth is – we don’t have much time left. Considering aging is an irreversible process, somethings can’t be put on hold until I have accumulated a lot of cash from a job. And judging by this site, most people might have guessed – travelling has always been one of the top 10 items in people’s bucket list.
Are you living your ideal lifestyle today? Are you at your best ability today?
I have an avenue that I have repeatedly mentioned. A global business that simply adds more fun into my life and the people around me. How do we start small steps and progress towards the B and I quadrant? These are my steps. Contact me today via my email (email@example.com) if you wish to discuss further.
Maybe up next, I might discuss about what is passive income, and its importance.