Capital Gains vs Cashflow Income : Which are You Chasing?

I’m a big fan of Robert Kiyosaki, I’ve read a number of his books and played the board games CashFlow 101 & CashFlow 102 – which I HIGHLY recommend (NOT affiliate links, just in case you’re wondering).

Before I struck it big and become financially independent, my wife and I played the CashFlow games literally dozens of times.

The goal of CashFlow is simple : to build a passive income from real estate deals and business investments that is 1X to 2X your living expenses, at that point you escape the “rat race” and move on to the “fast track” where you can build your business empire and do lots of cool stuff.

It’s an AMAZING game that will really take your thinking to the next level. I can tell you that it really help me back when I had a lot of broke job thinking.

If you’ve played the CashFlow game before you know that the basic strategy to follow is this:

1. Do Capital Gains deals, where you can make a whole bunch of money is a short period of time. Flipping real estate or trading stocks is how you do this in CashFlow.
2. CashFlow Deals : Once you’ve accumulated some serious cash (I’ll usually shot for about $50k), then I start investing in CashFlow Deals. This is long term stuff that will give you a steady amount of passive income every month. Remember building your passive income is ultimately the goal. You do this by buying businesses and apartment building with the money you’ve made with the capital gains deals.

Here’s what I’m getting at…

I want you to sit back and think about this for a moment, and how this applies to affiliate marketing?

Here’s a smart long term strategy for financial freedom with affiliate marketing :

Capital Gains Deals : Start a bunch of direct linking campaigns and cash in while they’re hot. Hit up season affiliate offers, and new hot CPA offers. You can quickly make a ton of cash using these strategies. (I know from a tax/legal stand point this is NOT actually capital gains income, I’m just making an ANALOGY)

Cashflow Deals : From the money you make with direct linking and short term affiliate offers you can invest that money into : building authority sites, buying existing websites, developing your own product, etc, etc.

If you ask me this is one of the TOP ways of becoming financially free. WAY faster & easier than the traditional route of messing around with real estate and traditional business.

Yuck!

Here’s the problem with how most affiliates do this business…

Most affiliates usually focus strictly on short term offers (capital gains) and have to keep promoting more and more stuff. Ever hear about the super affiliate bragging about making 100 sites before Christmas season starts?

Dude, that’s a BAD job if you ask me – but you will make a lot of money.

The other scenario (much smaller percentage) is the affiliate who tries to make a authority site or who tries to produce their own product right off the bad (not really an affiliate in that case). There’s no doubt this scenario works, however, it will typically take you MUCH longer to get financially free.

It’s also a bigger risk since :

1. Your investing a lot of money out of your job income into something that could be a big FLOP. You don’t want to get financially screwed.
2. You don’t have the real world experience of launching campaign after campaign and getting your butt kicked by Google as few times. The experience of being an affiliate FIRST gives you a HUGE advantage when you’re moving on to bigger more long term projects.

So in a nutshell :

1. If you’re not already, start bringing in some big money with short term affiliate offers
2. After you’ve got some cash, start building a SOLID income stream. Trust me, once you have steady income stream your stress levels will go way down and you’ll be MUCH happier – especially if that income stream is several times your living expenses.