Choice 1 and 2 are examples of people who park their money and choice 3 is an example of people that increase the velocity of their money.

Other than being able to change investment allocations or buying and selling, you have little to no control over investments in 401(k)s, mutual funds, and stocks. The individual companies have presidents and boards of directors who have control over the operation of the underlying business.

Professional investors want CONTROL over their assets and their cash flow.

When I was struggle financially in the first quarter of my life, I asked rich dad what happened to people who did not have anything at the end of the forth quarter. He quietly said, "They go into overtime." In other words, they may have to work for the rest of their lives, which may not be bad thing as long as you are able to work. In fact, I believe working keep us healthier and happier. I know because I retired at forty-seven and found it depressing.. Which is why I keep working, even though I do not have to.

Going into overtime after the fourth quarter is not bad as long as you enjoy what you are doing. One of the problem commercial pilots have is that they are required to stop flying at age sixty.

One of my recommendations to people is if you are faced with an overtime situation financially do something you enjoy and you can work at for as long as you want to work at it. In other words, don't be like some of my classmates who are old pilots without any other profession. And remember, even if you feel strong and healthy today, there will come a time when you will call an end to the working game and really want to retire and do nothing. Also remember that doing nothing can still be expensive.

Reason #1: The Power of the Word Can't
So you find yourself saying "It's easy for him to say! I can't do that! I can't afford it! His rich dad, on the other had, forbade him from saying " I can't afford it!" and challenged Robert to ask instead, "How can I afford it?" The word "can't" closes your mind, while the phrase "How can I?" opens your mind

Reason #2: The Power of Easy
"Money flows to the person who makes life easy."
However, creating an investment that makes life easy is not easy at first. But once created, the money starts flowing.
It may sound contradictory but remember, rich dad also said, "When it comes to investing, the people who take the hard road find life easy. People who take the easy road usually find life hard." If you take the time to create the investments today, your life will become much easier later.

Reason #3: The Rich Make It Easy to Be Poor
It is so much easier to get bad debt (personal debt like credit cards that you have to pay for from personal funds) than to get good debt (debts that is paid for by the income from the underlying investment). Personal debt is at an all time high

Reason #4: Investing Without Guarantees
This comes back to investing for actual cash flow today versus the promise of capital gains tomorrow.Can you see yourself controlling each of these reasons in your personal investing strategy so you can become a power investor?

As an employee, your taxes are withheld from your income, so your cash from pattern is:
EARN → PAY TAX → THEN SPEND

As a business owner, your cash flow pattern is:
EARN → SPEND → THEN PAY TAX

The difference in cash flow and the tax benefits available to business owners is why rich dad and Robert recommended you start a part-time business. As a business owner you have the use of the money and can use it to reinvest in building your business, before you pay taxes, instead of the government taking its share even before you receive your income

Increase Your Cash Flow Through Starting a Business and Deducting Legitimate Business Expenses
As a business owner you can take advantage of tax deductions that are not available to employees. With proper advice and documentation, you might event be able to convert some personal expenses into legitimate deductible business expenses. Of course, your business should have legitimate money making business purpose, other than just saving taxes. Here are just some of the business deduction you might be able to take advantage of:

• Home office expenses
• Business equipment (computer, cell phones)
• Office supplies
• Internet and telephone service
• Software and subscriptions
• Mileage and other auto expenses
• Travel, meals, entertainment
• Business gifts
• Medical insurance program
• Medical expenses
• Tuition and seminar educational expenses
• Child labor expenses
• Furniture

Robert describes the bonus of depreciation of real estate and how it increases your cash flow and provides a paper loss that can be offset against your other income.
Let's say we buy a building for $1 million. We determine that the building is worth $800,000 and the land is worth $200,000. The following chart shows the cash flow from the property. First, notice that we have been able to leverage our down payment of $100,000 with a bank loan of $900,000. So our $100,000 cash has allowed us to invest in a $1 million property. That is leverage of 9:1. (Remember that the banker told Robert he would NOT lend him money to purchase mutual funds, but he would consider lending him money to buy real estate or start a business.)

This represents a 12 percent cash-on-cash return. ($$12,492 net income on the initial investment of the $100,000 down-payment) BEFORE depreciation.
Now let's add the impact from the depreciation deduction allowed by the tax law. Let's assume that this property is a residential rental property, as the deduction allowed are based on the type of property. The tax law allow you to do a cost segregation between personal property and the building and then also allows you to depreciate the personal property more quickly than the building. This is where your tax advisor can assist you in getting the largest depreciation deduction possible. Let's see how the depreciation impact our income from the $1 million property outlined above.

This is where Robert's tax advisor Tom came in with is term magic money. This taxable loss, which is called a "paper loss", is created by the "phantom deduction" of depreciation. If you or your spouse qualifies as a real estate professional you can offset your other taxable income by this loss of $24,994.
Let's say your effective income tax rate (federal, state, and local) is 40 percent, your actual tax savings will be $10,398 from this paper loss offset. This brings your total cash return from the property to $22,890.