Types of Income - Residential Status and Scope of Total Income, Income Tax Laws Video Lecture | Income Tax Laws - B Com

hi its Jared and today we're going to be
talking about the four different ways
that you can make money there's really
four basic ways to make money and when
you understand this you can start to
understand how you can create wealth
versus making money you can start to
understand why the rich get richer you
can understand why the poor in the
middle class sometimes have a hard time
breaking out of that but once you
understand this then now you understand
how to break out of that and how to
create wealth and it's all about cash
flow and understanding these four basic
types of income and dinner and then
putting in a plan of action to go from
earning the poor types of in comes to
the the richer types of incomes and so
it's really as simple as that they don't
teach this in schools so you know maybe
this is the first time you've heard this
when I first heard it it blew me away
and I said I'm going to figure out how
to create cash flow and so and some of
you don't even understand the meaning of
that word so but let's go ahead and jump
in let's dive in and talk about this so
there's four different types of income
employee self-employed business and
investment and that's it now the the
best form of income is investment
because your money is working for you
and the problem is the poor in the
middle class you know which is you know
the category that I grew up in you
really don't have money to invest and so
you know even when my wife and I got
married and we started have a family and
you know I had a business and we really
didn't have money to invest until we
understood this cash flow quadrant and
how to get where we want to go so
employee is where you trade time for
dollars and that's the worst form of
income because if you work eight hours
and you're making $10 an hour you get
$10 back a lot of people call this you
know renting your life away you
basically rented your time too
one else for amount of money now
sometimes you have to go to work and you
need to have a job but you don't want to
stay here you want and you may stay
there the rest of your life but you want
to figure out even if you're going to
work for someone else the rest of your
life will be an employee nothing wrong
with that you want to figure out how to
move to the better parts of the cash
flow closet so you really want to move
from the left to the right and then from
the top to the bottom and so he is
employee income trading time for money
and the problem with it is is if you
don't show up if you get hurt something
happens to you you you don't have that
money coming in and also you can lose
that income very very quickly so if they
decide to replace you you know a lot of
different things reasons why this is the
worst form of income you'll never exit
the rat-race you'll never have true
freedom as long as you remain right here
in the Quad rec you want to move in this
direction from left to right so the S
represents self-employed so this would
be a person that like they own their own
business but it's really just them they
don't have employees maybe they have a
couple but it's a small business and
they don't have any employees or they
have a few and still you're trading
dollars for hours now you work for
yourself instead of someone else making
someone else rich now you're building
your own business as a small
self-employed person but again what
happens if you break your leg and you
can't go to work what happens if you're
in the hospital for a month and you
can't go to work it just affects you
drastically and so you're still trading
dollars for hours it's a bad place to be
you're never going to create wealth
you're never going to get where you want
to go financially in life and create
wealth especially in these two quadrants
you want to move from left to right so
what is the B is a large business owner
and a large business owner generally has
anywhere from a hundred to five hundred
employees or more or maybe five hundred
people on his team or in his network or
more and this is where you want to get
because as a large business owner here's
what the
means this means that you can actually
leave your business for a year you could
throw your phone in the ocean you could
go to the other side of the world go to
Fiji for a year and sit on the beach and
do nothing and you know drink pina
coladas and you came back a year later
and your business is performing just as
well and it's been spitting out just as
much income and profit even if you
weren't there or it's even grown that is
a large business that's the B quadrant
okay so that's produces cash flow
whether you're working or whether you're
not it's producing cashflow large
business now you want to move so so we
want to move from left to right but then
ultimately you want to move from the top
to the bottom over here so a lot of
people misunderstand the term multiple
streams of income it's best to have one
or two maybe a third but some simple
forms of income but if you're building a
business focus on one or two things it's
certainly not in the same industry so
especially people like in direct sales
and they were marking you want to focus
on building one business maybe your
small business owner traditional
business hey that's cool but you want to
focus for several years and build this
build this business because then what
happens is it starts to throw off cash
and it doesn't matter if it's $500 a
month or it doesn't matter if it's 5,000
or $50,000 a month extra cash flow okay
over and above what you need to pay your
bills and do those sorts of things to
live give and invest and things like
that you can actually start to invest in
investments and so the I portion of the
quadrant cashflow quadrant is where you
want to be because this is where your
money starts to make money for you you
know Heather and I my wife now we've
been blessed to move from employee small
business owners I used to
when I was out of college I worked for
someone else I had a job while I was in
college and then I became a small
business owner I was in the wireless
industry and you know what if I didn't
show up for work and I had a few
employees in my name
but if I was gone and my business wasn't
running itself I had to be there
hands-on to make it work and then we got
into the business we're in today we
started with company called pure and we
built a team of well over 500 plus I
mean now into the thousands and
thousands large business that produced
cash flow and serious cash flow way
above what we require to live on and so
then what we started to do is started to
make investments and now those
investments and we hire people to run
those companies or they're just their
business investments or they're just
investments in general real estate as an
example investment those your money is
making money for you your may truly
making money while you sleep
here and here in the investment it just
starts to multiply so that truly is the
path to building wealth every person
that has built wealth understands this
cash flow quadrant and the reality is is
if you stay over here or here you're
never going to move to the right and
especially down here where you're able
to make significant investments and your
money starts to multiply because most of
the time when you're over here you're in
debt you don't have a savings account
and you certainly most the time don't
have extra cash flow so you know the
reality is you need to get here you need
to build a big business reality and I've
never met anyone that's able to change
their life and build wealth especially
without owning their own business and
turning it into a big business so that's
what we do that's what we specialize in
helping people do that training
equipping inspiring how to do them how
to do that and anyone can do it if
they've got a I like to say if you've
got a hundred fifty bucks to your name
and a big dream then we can help people
I start from square one and just go and
so anyway I look forward to working with
you hopefully chatting about
dreams and where you want to go in life
in building some cash flow