________________________________________________________________________
JOIN OUR MAILING LIST and GET “SONIC WEAPONS: The Official Stereo Thesis Music Sampler FOR FREE.” To get your FREE full-length album…click here.
_________________________________________________________________________
Introduction
So
as an artist or musician which quadrant are you in? To answer this question,
refer to the chart above. One of my most favorite things I’ve ever heard from
Rich Dad author Robert Kiyosaki is that every person has two professions - one
for themselves and one for their money. What does this mean?
As
you’ll see in the video below there are 4 kinds of people. Each type tends to
earn their income from completely different sources, but the difference between
them all is how they view money and plan for its use. In other words, it’s the
ones who realize that their money has to work hard for them if they’ll ever
retire young or retire rich.
Similarly,
as an artist or musician you’re going to have to begin making decisions
concerning finances before your career takes off and you start earning your
living with music.
Your
Money’s Profession
Here
are a few examples of what Kiyosaki means in regard to your money’s profession.
If
you park your money in a savings account at a bank, then your money’s
profession is banking. And if you’re investing for the long-term and putting
your money into an IRA or 401K for retirement, then your money’s profession is
more often than not in stocks, bonds, or mutual funds. Or if you’re a bit more
sophisticated, you may learn to buy neglected real estate properties to fix
them up and sell them then your money’s profession is in capital gains from
real estate sales.
The
best example of what not to do with one’s money comes from that of a poor
person. They would be described as the person who spends everything they earn. In
fact, many high income earners spend everything they earn and are technically
broke. For these people their money’s profession is usually in debt payments to
cover the cost of living expenses and liabilities. Many celebrities, athletes, famous
musicians, actors, and even lottery winners wind up in this group because they
lack basic financial education.
Measuring
Wealth in Time
The
most important decision you'll make as an artist or musician is about which
quadrant you'll choose to remain in, change into, or combine to create
the greatest financial rewards you can possibly attain. As a musician,
all 4 quadrants are available to you. Have you ever considered the
broader range of opportunities available to you with a career in music?
Here's a few of the ways in which a career in music can be used to build
passive and portfolio income for your financial fortress.
As an E or
employee, you can work for a music studio as a resident musician or just
be a member in a band. As an S or self-employed, you can freelance for
several music studios or become a music consultant for a variety of clients. As a B or business owner, you can create a business model like Bandcamp, Tunecore, or iStock music where people work for you delivering a service or product to customers. One of the benefits of the B quadrant is that money is made without you, so you can leave the business and return to find it running even better than when you were there last. The self-employed person cannot do this, not working in their case means no income. As an I or Investor, you can build or find start-ups of music related businesses. Or you can invest in medium to large-sized companies to reap the fantastic rewards of their growth or turnaround success from creating cutting edge music related products and services like Amazon and Apple.
The bottom line to each of these scenarios is how fast can your money move and how fast can you grow your money? Each of the quadrants offers a different velocity to the growth of your money and each also severely limits the use of your time and money (E's and S's) or they free them up (B's and I's). Either way the amount of wealth you are going to be able to build will be determined by which quadrant you choose.
According
to Rich Dad, wealth is not measured in money, but rather in time. The primary
question that’s used to measure the extent of wealth is how many days could you
survive without a job, a paycheck, or income. For example, how many days,
weeks, or years would you be able to survive if you lost your main source of
income? Start thinking in terms of the Cash Flow Quadrant to train your mind to locate opportunities for you to take advantage of.
Conclusion
Over
the years I’ve heard many stories in the news about famous musicians, like
famous actors, athletes, and lottery winners, who end up in financial despair.
Why? Because they were never educated about finding a profession for their
money in order to make their money work hard for them. Instead they work hard
for money, remain ignorant about money, trust others to manage their money for
them and end up broke. So while they were able to get lots of money by working
hard they were not able to gain the knowledge necessary to understand how to
efficiently convert their earned income into passive or portfolio income. If they
had learned how to do this, they would have done 2 things: reduce their taxes
and laid a foundation for retiring young and rich. And at the very least they
would have prevented themselves from going into bankruptcy or worse – becoming homeless.
The
reason I’ve written this article is to try to prevent another young or talented
artist from making poor choices with their finances only to wind up broke, on
drugs, or mentally ill. Watch this video to learn more about the 4 kinds of
people that are found in the Cash Flow Quadrant and how you can move out of one
quadrant and into another to secure your financial future starting with a sound
financial education.
Watch this video to hear Robert Kiyosaki explain the Cash Flow Quadrant.
________________________________________________________
Related
articles:
___________________________________________________________________________
Marc
