book review writing of rich dad poor dad

Rich Dad, Poor Dad Summary & Review (2024)

Nick Gallo is a Certified Public Accountant and content marketer for the financial industry. He has been an auditor of international companies and a tax strategist for real estate investors

Rich Dad, Poor Dad is one of the most famous books in all of personal finance. Though it came out in 1997, it’s still the top #3 Best Seller on Amazon in 2024. Many of today’s most popular finance gurus cite it as the inspiration for their success.

I wanted to see what all the hype was about, so I grabbed a copy of the book, tore through it (it’s a pretty quick read), and compiled my thoughts for you here.

This Rich Dad, Poor Dad review will take a look at Robert Kiyosaki’s real lessons in this book (not just the ones he uses as names for his chapters) and help you decide whether it’s worth reading.

A Rich Dad, Poor Dad Summary

Right from the jump, Rich Dad, Poor Dad surprised me with its style and narrative framework. I expected more technical insight and investment math, but the book primarily consists of anecdotes that hold nuggets of (supposed) wisdom for the reader to absorb as if through osmosis.

Kiyosaki’s stories revolve around and contrast the lessons he received from his biological father (the educated but financially unsavvy poor dad) and his friend’s salesman father (the uneducated but clever, rich dad).

The book winds through Kiyosaki’s life and the reader witnesses him learning from his rich dad and rejecting the advice of his poor dad (which represents rising above the typical working-class mindset).

The book explains basic wealth generation in an understandable and inspirational way, and it’s a solid enough introduction to these concepts (at least for its time). However, it has issues that make its current relative value questionable.

❗️ Important Note: Do not take this book’s recommendations or any of my opinions on them as investment or tax advice.

Robert Kiyosaki’s Best Advice

I’ll start this Rich Dad, Poor Dad review with what I think Kiyosaki does well. Mainly, he makes some solid fundamental financial suggestions in an easily digestible manner.

The ideas might seem a bit shallow and apparent to anyone already engaged in entrepreneurship or investing, but they can be profound if it’s your first exposure to them. Let’s take a look. 

1. Learn Personal Finance (And Teach It to Your Kids)

While this is a pretty obvious suggestion, it’s still a significant one. The book does a great job of showing the reader how meaningful it is to learn how to manage your money. That means saving a high percentage of your earnings and putting the money to work in profitable investments.

Kiyosaki says: “ It’s not how much money you make. It’s how much money you keep. ” You have to keep your spending down as your income goes up and invest the difference in assets, not liabilities.

While his definitions of assets and liabilities might not follow Generally Accepted Accounting Principles, it’s practical: assets put money in your pocket, and liabilities take money out of it.

He supports learning to cut your taxes , studying accounting, and mastering saving, then teaching all these skills to your children. I love all of these ideas, and I’m glad his presentation of them resonates with so many.

2. Find Ways to Escape the Rat Race (Make Your Money Work For You)

Not only does Kiyosaki cover the fundamental best practices for personal finance, but he also does a great job of painting an inspiring picture of their end goal: financial independence, retirement, security, being rich, or whatever you want to call it.

I’ve always believed that people truly begin to understand the significance of their personal finance decisions when they realize that they constitute a journey that can culminate in holding enough wealth that work becomes optional.

Kiyosaki makes escaping the rat race using investments or a self-sustaining business sound glamorous and inspirational. I’m grateful for anything that gets people to plan for a better future.

3. Master Your Emotions Regarding Money

This one isn’t a personal finance message that you’d typically see today, but I like it a lot. Money is a hugely emotional issue for many people, and we could all probably benefit from understanding why it makes us feel however it does.

People often let their emotions sabotage their finances or let their finances upset their emotional state. They might have a fear of investing, insecurity over their job, or a need for the latest and greatest gadgets.

He urges readers to face their fears, cynicism, laziness, bad habits, and arrogance when it comes to money. That seems like an arbitrary list of emotional issues, but I like the sentiment.

4. Develop a Broad and Valuable Skillset

In a capitalistic society, having a practical and marketable skillset is the key to making money. If you can provide tangible value that people are willing to pay for, you’ll always be able to support yourself.

Kiyosaki recommends learning to manage money, lead teams, build systems, and close sales. More than that, he suggests that people cultivate a habit of continuing to learn throughout their careers so that they never stagnate.

He argues that people can improve their situations most effectively if they keep an open mind, learn from their mistakes, and keep improving. It’s a valuable lesson and one of the best in the book.

Robert Kiyosaki’s Worst Advice

Now that we’ve covered the good stuff, what follows is my Rich Dad, Poor Dad criticism. I hate to say it, but there’s more to talk about here than I’d like.

Honestly, Kiyosaki strikes me as a pretty typical guru. His attitude and tone throughout the book both rub me the wrong way. For example, he comes across as just a little too obsessed with the stereotypical image of a rich and powerful man.

He describes his rich dad as a charismatic manly man of few words, with power behind his statements and smiles. Rich dad is tall, blunt, and always closing deals. He doesn’t do things like the other guys, and he’s pretty smug in his superior knowledge.

Rich dad and his lessons also come off as manipulative to me. He pulls the protagonists’ strings purportedly to teach them esoteric lessons too complex to be put into mere words.

The book just feels like it’s selling me something, and salesman gurus are by far my least favorite. Here are some of the specific ideas the book tries to sell to the reader that I don’t like.

1. You Should Start a Business and Get Rich Because Employees are Broke and Miserable

As someone who truly loves being self-employed, I hate to admit this, but it’s not the right path for everyone. If you’d rather not branch out on your own, that’s perfectly fine. There are plenty of people who enjoy their jobs, make good or great money, and save responsibly.

But Kiyosaki has a habit of putting down anyone who works for someone else and suggesting that employees are generally broke and unhappy. They just don’t get it.

His poor dad (already an insulting title), who worked a traditional job, couldn’t possibly understand what his rich dad understood thanks to all his business success.

Not only does Kiyosaki fail to address the risks and downsides to business ownership, but he also suggests some definitely-not-okay tax strategies using business entities. For example, he proposes using a corporation to write off vacations as board meetings or deduct health club expenses. Those moves can get you into much more trouble thsan they’re worth.

2. Academic Learning isn’t Valuable (Rich People Don’t Need It)

Kiyosaki also has a bad habit of downplaying the value of academic education and traditional learning. He seems to believe people who follow the general wisdom end up like his poor dad: highly educated but ineffective and stressed about their money. Rich people learn only by doing or from living life.

For example, rich dad says: “ All too often business schools train employees to become sophisticated bean-counters. Heaven forbid a bean counter takes over a business. All they do is look at the numbers, fire people, and kill the business. ”

Ironically, he promptly contradicts that claims, later saying: “ Accounting is possibly the most confusing, boring subject in the world, but if you want to be rich long-term, it could be the most important subject. ”

As an officially licensed and certified bean-counter, maybe he just hurt my feelings, but I don’t think so. Kiyosaki also glorifies rich dad’s cruel and unusual teaching methods, which included giving kids the silent treatment for weeks at a time while they work below minimum wage until they can’t take it anymore.

Because that’s how life teaches: “ It just sorta pushes you around. ”

3. Invest in Real Estate! It’s the Best Way to Get Rich!

At this point, you’ve probably noticed that many of his “worst lessons” have something to do with getting rich. That’s a significant part of what struck me as wrong about this book.

Getting rich isn’t really the point of personal finance. Maybe I need to “overcome my cynicism,” but I generally don’t trust gurus who toss that word around. Kiyosaki does it a bit too much for my comfort, and his suggested strategies for creating said riches aren’t always great either.

Mainly, it bothers me how strongly he doubles down on real estate. Investing in real estate can be a great way to build wealth, but (like self-employment) it’s not for everyone. It’s also not a requirement for a successful and diversified portfolio.

There are benefits to real estate investing, but Kiyosaki borders on implying that it’s a sure way to get rich quickly or inevitably. In reality, it’s a business like any other. There are unavoidable risks involved, and it takes knowledge, experience, and luck to succeed.

4. Jump Off Cliffs and Build Parachutes On Your Way Down

Last but not least, we have one of my biggest pet peeves in the whole book. Kiyosaki legitimately suggests that you pay yourself first (meaning your savings) even if that comes at the cost of paying your creditors, even if one of those creditors is the Internal Revenue Service!

Rich dad says: “ So you see, after paying myself, the pressure to pay my taxes and the other creditors is so great that it forces me to seek other forms of income. The pressure to pay becomes my motivation. I’ve worked extra jobs, started other companies, traded in the stock market, anything just to make sure those guys don’t start yelling at me[…] If I had paid myself last, I would have felt no pressure, but I’d be broke. “

Don’t get me wrong, I’m all for prioritizing saving, but paying yourself first shouldn’t mean risking stiffing the people you owe money, wrecking your credit score, and racking up fees and interest. You pay your creditors and essential living expenses first, then you set aside your savings, and then you reverse engineer your remaining budget.

Is It Worth Reading Rich Dad, Poor Dad?

I don’t want this to upset anyone who considers the book to be the Holy Grail of personal finance, but I couldn’t recommend Rich Dad, Poor Dad to someone who asked me how to start managing their money better, let alone someone who already has some experience.

The book has a handful of positive lessons, but there’s nothing more profound in it than what you could find in the average personal finance blog these days. It’s mainly about inspiration, and there are places to get your inspiration these days without a side serving of Kiyosaki’s more troublesome ideas.

Learn More: If you’re looking for a comprehensive and grounded introduction to personal finance, take a look at some of our guides for beginners:

• How to Start Making Extra Income
• Taxation 101: How Do Taxes Work For Individuals?
• Budgeting 101: How to Budget Your Money
• Saving Money 101: The Road to Financial Independence
• Investing 101: Investing For Beginners

By Nick Gallo

Contributing writer.

Nick Gallo is a Certified Public Accountant and content marketer for the financial industry. He has been an auditor of international companies and a tax strategist for real estate investors. He now writes articles on personal and corporate finance, accounting and tax matters, and entrepreneurship. Find out more at NickAlexGallo.com.

This article was extremely well-written. I not only agree with the author’s claims about the book, but also genuinely enjoyed their writing style. I would like to see more reviews like this!

I’m delighted to hear that you liked this review! You said you’d like to read more reviews like this one, and now you can! Nick recently reviewed another personal finance favorite for our website: The Millionaire Next Door Review . Let us know what you think of this one!

I would have to somewhat disagree on the accounting statements being contradictory. Accounting is extremely important in business, but that doesn’t change the fact that if you just have the accountants run things that it can drive the company into the toilet. The accountants just don’t know any better. This was one of the problems with GM for example. It was a car and manufacturing company run by accounting and finance people instead of by people with a manufacturing background who also were car enthusiasts who knew some accounting.

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Rich Dad Poor Dad - a quick book summary and review

Robert Kiyosaki’s Rich Dad Poor Dad  was first published in 1997 and quickly became a must-read for people interested in investing, money, and the global economy. The book has been translated into dozens of languages, sold around the world, and has become the #1 personal finance book of all time.

The overarching theme of Rich Dad Poor Dad is how to use money as a tool for wealth development. 

It destroys the myth that the rich are born rich, explains why your personal residence may not really be an asset, describes the real difference between an asset and a liability, and much more.

Key takeaways/lessons learned

• Six lessons Robert Kiyosaki learned from his Rich Dad about making money and the mistakes that Poor Dad made
• Five obstacles to overcome before you can become rich and stay rich
• Ten steps to follow to develop your financial genius
• Actionable to-do steps you can put to work right away

Chapter/Section Summaries

Rich Dad Poor Dad contains a total of 10 chapters plus the introduction, but much of the book is focused on the first 6 parts or lessons. 

We’ll cover the introduction and the first 6 lessons, then the remaining 4 sections later in this review.

• Introduction: Rich Dad Poor Dad
• Chapter 1: The Rich Don’t Work for Money
• Chapter 2: Why Teach Financial Literacy?
• Chapter 3: Mind Your Own Business
• Chapter 4: The History of Taxes and the Power of Corporations
• Chapter 5: The Rich Invent Money
• Chapter 6: Work to Learn – Don’t Work for Money

Introduction

Poor Dad was Kiyosaki’s biological father, a man who was highly intelligent and very well educated. Poor Dad believed in studying hard and getting good grades, then finding a well-paying job. Yet, despite these seemingly positive attributes, Poor Dad didn’t do well financially.

Rich Dad was the father of Kiyosaki’s best friend. He had a similar work ethic to Kiyosaki’s real dad, but with a twist. Rich Dad believed in financial education, learning how money works, and understanding how to make money work for you. Although he was an eighth-grade dropout, Rich Dad eventually became a millionaire by putting the power of money to work for him.

The book is written from Kiyosaki’s perspective of how Rich Dad went about making money and the mistakes that Poor Dad made. The first 6 chapters of Rich Dad Poor Dad make up about two-thirds of the book and discuss the 6 lessons that Kiyosaki learned from his Rich Dad.

Chapter 1: The rich don’t work for money

Oftentimes people misunderstand the title of this chapter, and mistakenly believe that it means the rich don’t work. In fact, the complete opposite is true.

Instead of reading the chapter title as “The Rich Don’t Work for Money”, what Kiyosaki means to say is that “The Rich Don’t Work for Money. ” Note that by putting the emphasis on the word “money,” this section takes on an entirely different meaning.

The truth is that the majority of rich people do work very hard, but they go about it differently than most people do. Rich people—and people who want to become rich—work and learn every day how to put money to work for them. As Rich Dad says, “The poor and middle class work for money. The rich have money work for them.”

Kiyosaki also notes that having a regular job is just a short-term solution to the long-term problem (or challenge) of creating wealth and financial freedom:

“It’s fear that keeps most people working at a job: the fear of not paying their bills, the fear of being fired, the fear of not having enough money, and the fear of starting over. That’s the price of studying to learn a profession or trade, and then working for money. Most people become a slave to money—and then get angry at their boss.”

Chapter 2: Why teach financial literacy?

The second chapter of Rich Dad Poor Dad explains the difference between an asset and a liability. Chapter 2 drives home the point that it’s not about how much money you make, but about how much money you keep.

An asset is something that has value, that produces income or appreciates, and has a market where the asset can easily be bought and sold:

• Assets produce income
• Assets appreciate
• Assets do both

Conversely, liabilities take money out of your pocket because of the costs associated with them. When Rich Dad Poor Dad was first published back in 1997, Kiyosaki created a lot of controversy with this statement. 

That’s because by definition, a personal residence isn’t an asset unless it appreciates enough to offset the costs of ownership. On the other hand, rental property is an asset because it can generate enough passive income to exceed the expenses of operating and financing the real estate.

As Kiyosaki writes in Chapter 2 of Rich Dad Poor Dad , “Want to grow rich? Concentrate your efforts on buying income-producing assets – when you truly understand what an asset is. Keep liabilities and expenses low. You’ll deepen your asset column.”

Chapter 3: Mind your own business

There are 2 key messages in this chapter.

• First, pay off your debts and start investing in income-producing assets as soon as possible.
• Next, stay financially healthy by spending your time (instead of your paycheck) and investing as much of your money as possible in assets.

Kiyosaki notes in Chapter 3 of Rich Dad Poor Dad that most people confuse their profession with their business. In other words, they spend their entire lives working in somebody else’s business and making other people rich.

One of my favorite quotes from this section is:

“The primary reason the majority of the poor and middle class are fiscally conservative is that they have no financial foundation. They have to cling to their jobs and play it safe. They can’t afford to take risks.”

Chapter 4: The history of taxes and the power of corporations

When reading this chapter, it’s important to keep in mind that Kiyosaki wrote Rich Dad Poor Dad as a motivational book, not to provide expert financial or tax advice. 

For example, Kiyosaki writes about the time he bought a Porsche and treated it as a business expense, using before-tax dollars. Buying a high-end luxury car when a much less expensive make and model would do could put an investor on the fast track to an IRS audit.

But putting the Porsche aside, the points made in this chapter discuss how to play the investment game smart. The rich understand the power of company structures and the tax code and use every legal means they can to minimize their tax burden.

Compare how business owners and investors with corporations such as C corps, S corps, or LLCs pay taxes to how most people pay tax:

Business owners with a corporate structure:

Employees who work for corporations:

Notice that employees who work for somebody else spend their money post-tax, while business owners earn and spend before paying tax.

Chapter 4 of the book also covers the 4 main components of what Kiyosaki calls “Financial IQ”: Accounting, Investment Strategy, Market Law, and Law.

As Rich Dad Poor Dad reminds us, understanding the legal and tax advantages significantly contribute to building long-term wealth:

“For instance, a corporation can pay expenses before paying taxes, whereas an employee gets taxed first and must try to pay expenses on what is left. . . Corporations also offer legal protection from lawsuits. When someone sues a wealthy individual, they are often met with layers of legal protection and often find that the wealthy person actually owns nothing [in their own name]. They control everything, but [personally] own nothing.”

Chapter 5: The rich invent money

Inventing money means finding opportunities or deals that other people don’t have the skill, knowledge, resources, or contacts for. 

In Chapter 5, Rich Dad Poor Dad explains there are 2 types of investors:

• Investment packages are bought by people who entrust their money to a developer or fund manager. This is the way that most people invest, such as buying shares of an ETF or putting money into a real estate crowdfunding venture.
• Professional investors look after their own investments, research the market to find deals that make sense , then hire professionals to manage the daily oversight. Professional investors have 3 things in common: 
• Identify opportunities that other people have not found
• Raise funds for investment
• Work with other intelligent people

Here’s one of my favorite closing thoughts from this chapter:

“Some people argue that there aren’t real estate bargains where they are, but there are prime opportunities everywhere that are overlooked. Most people aren’t trained financially to recognize the opportunities in front of them.”

Chapter 6: Work to learn—don’t work for money

Poor Dad was intelligent and well educated and worked for money because job security meant everything to him. Rich Dad became a millionaire by working to learn.

As Kiyosaki writes:

“I recommend to young people to seek work for what they will learn, more than what they will earn. Look down the road at what skills they want to acquire before choosing a specific profession and before getting trapped in the Rat Race.”

In fact, that’s exactly what Kiyosaki did. He joined the Marines after graduating from college and learned the essential business skills of leading and managing people. After serving his country, Kiyosaki joined Xerox, overcame his fear of rejection to become one of the top 5 salespeople in the company, then left the corporate world to form his own business.

Chapter 6 of Rich Dad Poor Dad then discusses the synergy of management skills needed for success in business:

• Cash flow management
• Systems management
• People management

Overcoming Obstacles

Chapter 7 of Rich Dad Poor Dad begins by noting that “the primary difference between a rich person and a poor person is how they manage fear.”

Robert Kiyosaki isn’t talking about the type of fear that some people have when going to the dentist or watching The Exorcist . In the book, “fear” is about the fear of losing money and how to handle that fear.

It’s one of the 5 biggest obstacles people face on the path to becoming financially independent:

These roadblocks—and the failure to overcome them—are why people who have studied and achieved financial literacy are still unable to develop assets that generate plentiful amounts of cash flow.

Losing money is a fact of investing life, and so is the fear that comes along with it. Kiyosaki notes that he’s never met a rich person who has never lost money, but he’s met plenty of poor people who have never lost a dime because they’ve never invested .

Real estate investors who choose to act only on a “sure thing” are paralyzed by fear in disguise. People who can’t see the big picture and think big are the ones who almost never, ever succeed in investing or in life.

Everybody has doubts that affect self-confidence, and it’s easy to fall into the trap of playing “What if?” especially when friends and family are constantly reminding you of your potential shortcomings.

Things like the economy crashing, interest rates rising, and tenants not paying their rent are common “what if” fears that all real estate investors have. While these are important items to consider, it’s important not to allow the cynicism of others to overtake your control. Otherwise, you may become immobilized as opportunities pass you by.

In today’s interconnected world it’s easy to confuse being busy with actually accomplishing things that matter. In fact, according to Rich Dad Poor Dad , busy people are often the most lazy. 

Busy people arrive at the office early and leave late. They bring work home to finish at night and on the weekends. Before they know it, the people and things that matter most to them have disappeared. 

Instead of giving in to the call of the rat race and mistaking action for accomplishment, successful real estate investors are proactive and take care of themselves and their wealth first.

Habits control behavior. For example, most people pay their bills first before they pay themselves. The result is that there’s usually very little left over at the end of the month for investing.

Paying yourself first—even if you don’t have enough money to pay other people—makes you financially stronger, mentally and fiscally. In a way, it’s a form of reverse psychology. 

When you develop the habit of paying yourself first, you become motivated by the fear of not being able to pay creditors. In turn, you begin looking for other forms of income like investment real estate. 

Investors know what makes them money. But it’s the things they don’t know—and don’t know they don’t know—that makes them lose money. When people become truly arrogant, they honestly believe that what they don’t know doesn’t matter.

Train yourself to listen to what other people have to say, especially when it comes to money and investing. If you discover you’re ignorant about a subject, educate yourself or find an expert in the field.

Overcoming these 5 biggest obstacles on the path to real estate success requires a blend of balance and focus. There are plenty of “Chicken Littles” in the world today—people with a victimhood mentality who live their lives in cynicism and pessimism.

Rich Dad Poor Dad suggests filtering negative people and their fears out of your life. Instead, concentrate on the big picture and always ask, “What’s in it for me?”

Getting started

In Chapter 8, Rich Dad Poor Dad tells us that “there is gold everywhere, most people are not trained to see it.” 

Part of this lack of vision and clarity comes from the world we live in. We’re trained from a very young age to work hard for someone else, spend the money that we earn, and borrow more if we run short.

Unfortunately, people who choose to become one of the masses never take the time to develop their financial genius. 

Investing in real estate is the perfect example. The average person can spend a week out in the field and find nothing, while the investor who has trained himself can easily find four or five deals that make sense in a single day!

Here are the 10 steps to follow to develop your financial genius and discover the gold that’s already out there, just waiting to be found:

• Have a deep emotional reason or purpose for doing what you do, a combination of wants and don’t wants.
• Understand the power of choice and choose daily what to do, including choosing the right habits and educating yourself.
• Choose your friends carefully by leveraging the power of association, being careful not to listen to poor or frightened people.
• Master the power of learning quickly and develop a formula for making money.
• Pay yourself first by mastering the power of self-discipline to manage your cash flow, people, and personal time.
• Select great people for your team and compensate them generously for their advice, because the more money they make the more money you will make.
• Ask “How fast do I get my money back?” by focusing on return of investment first, followed by return on investment.
• Use money generated by assets you own to buy luxuries by focusing on self-discipline to direct money to create more.
• Have a role model to follow and tap into the power of their genius to put to your use.
• Realize that if you want something, you need to give something first.

Still want more? Here are some to-do’s.

In the final section of Rich Dad Poor Dad , Chapter 9, Kiyosaki pulls the key lessons of the book together into a checklist of actions you can start taking today:

• Stop doing what you’re doing by taking a break and assessing what is and isn’t working. 
• Look for new ideas by finding resources on different and unique subjects.
• Find a mentor who’s been where you're going, take them to lunch and pick their brain.
• Always be learning by taking classes, attending seminars, and reading.
• Make lots of offers (always with escape clauses) because eventually someone will say “Yes.”
• Spend 10 minutes each month for the next 12 months walking, running, or driving a certain area and looking for changes that create bargains.
• Shop for real estate deals when the market corrects, because profits are made when buying, not when selling.
• Learn how, when, and where to buy by investing in your education.
• Think bigger to get richer, because small thinkers don’t get the big breaks.
• Most people only look for what they can afford, so buy a bigger pie and cut it into pieces by finding a buyer first, then a seller.
• Negotiate volume discounts by thinking big, pooling people together, and buying in bulk.
• Read and learn from history, because history always repeats itself.
• Action always beats inaction.

Is Rich Dad Poor Dad Worth Reading?

The goal of Rich Dad Poor Dad is to motivate you to develop your own unique path to financial freedom. 

While the book doesn’t take a one-size-fits-all approach with ready-made answers, it does provide an excellent framework for creating your own objectives to build wealth by investing in real estate.

• Provides a contrarian view that is different from the “common knowledge” found in most personal finance education
• Focuses on turning income you earn into assets that produce even more income
• Encourages controlling spending and expenses
• Explains why investors should focus on real estate vs. other asset types
• Emphasizes the power of thought and continual learning
• Talks about taking action instead of just thinking about it
• Success examples in the book are unique to Kiyosaki’s specific situation and may be hard to replicate
• Some parts of the book also lack detail, which may make the concepts discussed more difficult to apply
• Frequently demeans people who are more comfortable following the herd rather than thinking for themselves
• Rich Dad Poor Dad is a motivational book, not a book written by a financial exper

Jeff has over 25 years of experience in all segments of the real estate industry including investing, brokerage, residential, commercial, and property management. While his real estate business runs on autopilot, he writes articles to help other investors grow and manage their real estate portfolios.

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Rich Dad Poor Dad: Book Review, Summary & Key Takeaways

by Holistic Leave a Comment | Filed Under: Wealth Management

Today we are looking at “Rich Dad, Poor Dad” by Robert Kiyosaki. One of the very famous books on personal finance.

I will quickly take you through the gist of what the book is all about.

This book was first published in 1997, and the overarching theme of this book is How to Make Money as a Tool for Wealth Development.

This is a very interesting book because it destroys the age-old beliefs that you and I inherited from our forefathers. It also denies the fact that the majority of rich people are born with a silver spoon!

Table Of Contents

1.)Quick Summary 2.)Rich Dad Poor Dad – Wealth Creation 3.)Six Lessons From Rich Dad Poor Dad 4.)Stay Rich! 5.)Rich Dad Poor Dad – Steps For Financial Genius 6.)Assets vs Liabilities – Insights From Rich Dad Poor Dad 7.)Concept Of Tax 8.)Rich Invent Money 9.)About The Author 10.)Conclusion

1. Quick Summary

Rich Dad and Poor Dad revolves around three main characters: Poor Dad, Rich Dad, and Son (the author himself as the narrator of the book).

The Rich Dad is the father of his best friend who happens to be an eighth-grade dropout, not qualified and did not study well, but this dad believed in financial education, not just academic education. The Poor Dad is actually Kiyosaki’s biological father.

His biological father is highly qualified and very well educated, and he believes in the principle that you must study hard so that you get good grades, this is what typically happened with all of us when we were children, especially in India. Right?

2. Rich Dad Poor Dad – Wealth Creation

The book explains the principles of cash flow, balance sheet, income statement, assets, and liabilities in an easy-to-understand manner. The author hopes that everyone was taught the fundamentals of finance from childhood, as he was, which is one of the reasons he wrote this book.

This is a given that parents always persuade you to study hard, and get good grades, so that you get a good job, a well-paying job. Despite all of this, his poor dad did not do financially well, which basically talks of the fact that your qualifications, your profession, and your job may not guarantee wealth creation.

Please remember I’m using the word ‘ wealth creation’ . Your good grades, your good job, your profession, and your job title could perhaps guarantee good income. You may be earning well, but you may not necessarily create wealth

3. Six Lessons From Rich Dad Poor Dad

If you look at the book, he talks about six lessons that he has learned from his Rich Dad about making money, and he also talks about the mistakes made by his Poor Dad.

That’s also important, right? For example, if you want good health, you should know what are the foods that you’re supposed to eat. Equally important is that you also should know what to avoid. Similarly, what are the lessons that he has learned from his Rich Dad, and what are the mistakes made by his Poor Dad so that you and I don’t make the same mistakes?

Lesson 1: The wealthy do not work for a living. Lesson 2: Financial Literacy Lesson 3: Take Care of Your Own Business. Lesson 4: The History of Taxes and Corporate Power. Lesson 5: The Wealthy Create Money. Lesson 6: Work to Learn, Not to Make Money.

4. Stay Rich!

“It’s not just about becoming rich, it is also important to stay rich”.

What are the obstacles that have to be overcome to become rich and stay rich?

• Apprehension
• Poor Habits

Shortcomings motivate the Fearless Man since they provide a learning experience from which they might improve. The Lazy and arrogant do not achieve financially because the agony and misery of losing money outweigh the delight of being wealthy.

They chose a life that is basic, safe, and little. They may buy large houses and expensive cars, but they do not prioritize large investments. The bulk of people suffer financially because they play to avoid losing rather than to win.

5. Rich Dad Poor Dad – Steps For Financial Genius

“The poor and the middle-class work for money, and the rich have money work for them”. 

There are 10 steps that Robert Kiyosaki talks about in his book to develop your financial genius. This is in a nutshell what the book is all about, and these are some of the lessons from his book.

• 1.Have a strong emotional reason or purpose for doing what you do, a mix of wants and dislikes.
• 2. Understand the power of choice and pick what to do on a daily basis, including developing good habits and educating yourself.
• 3. Choose your friends carefully by utilizing the power of association, and avoid listening to impoverished or scared people.
• 4. Master the ability to learn quickly and devise a money-making technique.
• 5. Pay yourself first by developing the ability to handle your cash flow , people, and personal time with self-discipline.
• 6. Choose exceptional team members and generously compensate them for their advice, because the more money they make, the more money you will make.
• 7.”How quickly can I get my money back?” Emphasize more on getting the money back.
• 8. By focusing on self-discipline to direct money to create more, you can use the money earned by assets you own to buy indulgences.
• 9. Have a role model to look up to and use their genius to your advantage.
• 10. Recognize that if you want something, you must first give something.

6. Assets vs Liabilities – Insights From Rich Dad Poor Dad

The necessity of understanding the distinction between assets and liabilities and focusing on investing in assets is highlighted throughout the book and referred to as the “one and only rule.”

Most of us, when we learned assets and liabilities, we were taught that assets are those which increase in value, and liabilities are those which reduce in value.

Robert Kiyosaki talks about an additional point.

“ That assets produce income and they also appreciate”.

They produce income, appreciate, liabilities, and take money out of your pocket. That is why he also talks about our own personal real estate. The house that we stay in may not be an asset because you are living in that house and it’s not producing any income for you.

• Look After Yourself!

He also talks about minding your business, which is basically looking at yourself, trying to pay off your debts as much as possible, being in zero debt, and starting investing in assets that can produce income.

The book discusses looking at yourself first and trying to pay off your debts before investing in assets.

7) Concept Of Tax

The book talks about the concept of tax in a very beautiful way. The equation is very important to understand. He says that between salaried versus business owners, which is self-employed.

Companies, business owners, self-employed. The formula is, Earn → Spend → Pay Tax. Spending can be taken as an expenditure in the business. You are left with a very limited, little amount of taxes to be paid. You and I are salaried employees.

We work for companies. We also earn, but we pay tax because there’s also TDS that already takes away money. Then what remains we spend.

So, self-employed, people have flexibility. They can structure their expenses. The equation is beautiful. Earn → spend → Pay Tax.

If something remains, you pay tax, otherwise, you don’t even pay tax. You and I have no choice because there’s a TDS.

8) Rich Invent Money

In this book, Robert Kiyosaki talks about the rich inventing money. They identify opportunities that other people have not found and they work with intelligent people..“I recommend to young people to seek work for what they will learn, more than what they will earn. Look down the road at what skills they want to acquire before choosing a specific profession and before getting trapped in the Rat Race”.

Again, this is very interesting , “It’s not learning to work, it is working to learn”.

which means you don’t work for money. Identify skills that you want to acquire before you choose a profession.

Isn’t it true that the majority of us have ended up in our profession by chance? Robert Kiyosaki says to pick a profession, and then figure out what abilities you want to develop so that you may be the highest earner in that profession.

9) About The Author

Robert Kiyosaki grew up in the small Hawaiian town of Hilo. In New York, he attended Kings Point Merchant Marine Academy. Following graduation, Robert turned down a well-paying position with Standard Oil to join the Marine Corps as a helicopter pilot during the Vietnam War.

Following his military duty, Robert went to work for the Xerox Corporation. His wealthy father advised him that the key to every successful firm is sales.

Robert rose to become Xerox’s top seller. His entrepreneurial instinct took over from there. He and his brother founded the company Rippers. Rippers was the first firm to commercialize the nylon and Velcro “surfer” wallet.

Robert and his wife, Kim, invented and launched the CASHFLOW board game in 1996 to teach people about money and investing creatively and excitingly.

In 1997, Robert published Rich Dad and Poor Dad, and they established The Rich Dad Company. The book and the board game are now more popular and relevant than ever.

Robert has written 27 books. He has appeared as a featured guest on media channels all around the world. He is the podcast host of the Rich Dad Radio Show, a world-renowned speaker, and a life-long learner.

10) Conclusion

This book questions your thought process. Robert Kiyosaki has talked about overcoming obstacles, and how to get started, and there’s a to-do list also that he provides.

Rich Dad Poor Dad is available in multiple languages for readers. The first step before handling your finances is to improve your financial literacy. One of the best ways to improve financial literacy is by reading books.

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Rich Dad Poor Dad Summary

1-Sentence-Summary:   Rich Dad Poor Dad tells the story of a boy with two fathers, one rich, one poor, to help you develop the mindset and financial knowledge you need to build a life of wealth and freedom.

Favorite quote from the author:

Table of Contents

Video Summary

Rich dad poor dad review, audio summary, who would i recommend the rich dad poor dad summary to.

Rich Dad Poor Dad is a modern classic of personal finance and our favorite finance book of all time . Although the book is controversial and often takes criticism, people still believe it’s worth reading. Otherwise, it wouldn’t have sold over 32 million copies.

Robert Kiyosaki tells the story of his two Dad’s in his childhood. His own father and the father of his best friend. While he speaks affectionately of both, they were very different when it came to dealing with finances.

The summary on Blinkist starts with the idea that many of us are too afraid of being branded as a weirdo, in order to exit the rat race . We let the two main emotions everyone has around money dominate our decisions:  fear and greed.  That’s why we still stick to the outdated mantra “Go to school, go to college, get a job, play it safe.” when in reality no job is safe any more .

For example, when you get a raise at your job, a wise choice would be to invest the extra money. Put it into something that builds wealth like stocks or bonds, which has risk, but a lot of potential. Maybe you find a good fund with a 60% chance to double your money within a year, but a 40% chance of losing it all. However, most likely your fear of losing the money altogether will keep you from doing so.

But when your greed takes over, you might then spend the extra money on an improved lifestyle. You might buy a fancy new car, and the payments eat up the money, for instance. This way you’re almost certain to lose 100%. This already gives you a glimpse of how important it is to educate yourself financially. Since we receive no financial education in school or college, sadly, this is entirely up to you.

Look around and you’ll see plenty of financially ignorant people in your own life. Just take a look at local politicians. Is their city in debt? Your mayor might be great, but unfortunately, he probably doesn’t know how to deal with money.

If you want to save this summary for later, download the free PDF and read it whenever you want.

For the same reason 38% of Americans don’t save anything for their retirement . The only way for you to counteract this is to  start now.  Today is the youngest you’ll ever be, so take a close look at what you can and can’t afford. This way you’ll be able to set realistic financial goals , even if it means waiting for that shiny new BMW.

Next, adopt the mindset of “work to learn” instead of “work to earn”. Take a job in a field you have no clue about, such as sales, customer service or communications, to develop new skills – you never know what they might be good for . Set aside 5% of your income each month to buy books, courses and attend seminars on personal finance to start building your financial IQ .

The first step toward building wealth lies in the mindset of managing risks instead of avoiding them. Also, learn about investments to understand that it’s better to not play it safe because you’ll miss big potential rewards. Don’t start big, just set aside a small amount, like $1,000 or even $100, and invest it in stocks, bonds, or even tax lien certificates . Treat the money as if it’s gone forever and you’ll worry less about losing it.

As soon as you start your journey towards wealth, you’ll realize that it’ll be quite a long one. That’s why it’s important to stay motivated. Kiyosaki suggests creating an “I want” and an “I don’t want” list. Include items like: “I want to retire at age 50.” or “I don’t want to end up like my broke uncle.”

Another idea is to pay yourself first each month.  Take the portion of your salary you want to spend on stocks or your financial education, invest it, and pay your bills afterward. It’ll create pressure to be creative in making money and show you what you can afford.

Use your money to acquire assets  instead of liabilities . Assets are stocks, bonds, real estate that you rent out, royalties (for example from music ) and anything that generates money and   increases in value over time.  Liabilities can be cars with monthly payments, a house with a mortgage, and of course debt.  Anything that takes money out of your pocket each month is a liability .

There’s no rush. Just stay at your full time job and “mind your own business”. In this case, your job is what pays the bills and your business is what makes you wealthy.  Build your business on the side and use it to invest in assets until your assets eventually become the main source of your income. You can even file a corporation to be taxed only  after  you’ve earned and invested, instead of being taxed  before investing as an employee and trying to live off what’s left.

The most important thing is that you start today . You are your own biggest asset, so the first thing you should put some money into is yourself.

I read the book a year ago and I loved it. I felt a little heartbroken when I found out that most of the story is made up and that there’s so much criticism around Robert and the book. However, that doesn’t make it less of a good story or advice.

Unfortunately, the story of his two Dads is what makes the book great – and it’s completely missing in this summary on Blinkist. While the financial advice is sound in the summary, it’s not nearly as powerful as it is when you get it wrapped in the book’s story.

The book isn’t too long either, and the initial story is mostly covered in the first 50 pages, so I highly recommend you get a copy of the book and read it yourself. It costs less than $10, which I think makes it a great investment. And isn’t that what you came here for?

Listen to the audio of this summary with a free reading.fm account:

The 9-year-old who just got her first allowance, the 42-year-old who’s worried about her job being secure, and anyone who doesn’t know what the definition of an asset is.

Last Updated on July 25, 2022

Niklas Göke

Niklas Göke is an author and writer whose work has attracted tens of millions of readers to date. He is also the founder and CEO of Four Minute Books, a collection of over 1,000 free book summaries teaching readers 3 valuable lessons in just 4 minutes each. Born and raised in Germany, Nik also holds a Bachelor’s Degree in Business Administration & Engineering from KIT Karlsruhe and a Master’s Degree in Management & Technology from the Technical University of Munich. He lives in Munich and enjoys a great slice of salami pizza almost as much as reading — or writing — the next book — or book summary, of course!

*Four Minute Books participates in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising commissions by linking to Amazon. We also participate in other affiliate programs, such as Blinkist, MindValley, Audible, Audiobooks, Reading.FM, and others. Our referral links allow us to earn commissions (at no extra cost to you) and keep the site running. Thank you for your support.

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Rich dad poor dad summary: key takeaways & review.

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Few personal finance books have reached the cult status that the book Rich Dad, Poor Dad has.

When first published in 1997, it impacted the finance world by introducing revolutionary ideas. It changed the way most people think about money and how to acquire wealth.

If you haven’t read the book but want a gist of all the brilliant ideas it introduced, read this detailed Rich Dad, Poor Dad summary. You will also find the best quotes, key takeaways from the book, and practical ways to implement them.

Let’s get started.

Rich Dad Poor Dad Book Summary at a Glance

1. focus on assets, not liabilities, 2. get a financial education, 3. run your own business, 4. understand the tax code and legal system, 5. learn to invent money, 6. work to learn, not for money, 7. take financial risks, 1. the rich don’t work for money; only the poor do, 2. rich people acquire assets, and poor people acquire liabilities, 3. it doesn’t matter how much money you make but how much you save, 4. financial aptitude is what you do with the money you earn, 5. our single most valuable asset is our mind, popular rich dad poor dad quotes, apply rich dad poor dad learnings with clickup, ace financial management with clickup.

Rich Dad, Poor Dad by Robert T. Kiyosaki is one of the most important books on personal finance that introduced a new perspective on wealth management.

The author explains key concepts of financial management by comparing and contrasting the financial philosophies of his two dads—the rich dad and the poor dad.

His poor dad was a highly educated, salaried man who believed in hard work, job security, and formal college education.

His rich dad was an entrepreneur who didn’t believe in formal education—he believed in financial literacy. He had a different view on financial management than his poor dad. He believed that the only way to build wealth is to run a business and invest in assets that generate passive income streams.

The book’s most notable and revolutionary concept was Kiyosaki’s explanation of assets versus liabilities. He explained that assets bring in money while liabilities drain money.

Many people think of homes or cars as assets, but they’re liabilities. Investment and rental properties that generate income are the real assets.

Overall, the Rich Dad, Poor Dad book is about getting a financial education and making wise financial decisions to acquire wealth and escape the rat race.

Key Takeaways from Rich Dad Poor Dad by Robert T. Kiyosaki

This classic has numerous gems, but we’re restricting ourselves to the seven biggest lessons you learn from the book.

The key focus of the book was to teach people to be financially independent and how to build wealth.

Kiyosaki says most people don’t understand the difference between assets and liabilities. He defines them as:

• Assets are things that bring in money, such as real estate, stocks, and businesses
• Liabilities, on the other hand, drain money from your pocket. These include home or car loans, credit card debt, and more

For this, he takes the example of a house, which most people consider an asset but is a liability. He explains that if you buy a house for yourself and use a mortgage, you only incur expenses and get no income from it, making it a liability.

Only commercial real estate, for which you get a rental income, is an asset. Build assets that bring you income, not liabilities that incur expenses.

The most important lesson from Rich Dad, Poor Dad is that financial literacy is crucial to financial success. 

He argues that school education fails in this regard and needs to effectively teach financial literacy, including the basics of financial management and wealth building.

He uses the example of his two dads—rich and poor—and the differences in their financial philosophies to point out why financial education is essential.

His poor dad was well-educated and believed in earning a salary. Though less educated, his rich dad was more financially literate and believed in investing money and running a business to build wealth and become financially independent.

So, as vital as it is to be well-educated, being financially educated is a whole different ball game. Invest in financial education and learn the basics of money management, risk assessment, and other vital aspects to manage your finances better.

Another takeaway from Rich Dad, Poor Dad is that having a job and earning a salary will not make you rich; running a business will.

According to Kiyosaki, the rich acquire assets and make the money work for them. They don’t work for others but only for themselves. 

Earning passive income from assets is the key to building wealth over time instead of relying on a salary. Rather than working hard to make money for someone else, let others work for you to make you richer. 

Kiyosaki says that the rich understand and use the tax code to their advantage.

He explains that you pay high taxes when you earn a salary or take loans. Some taxes include income tax, social security tax, and Medicare tax.

But if you run a Corporation, you can write off business expenses and pay less taxes. You can even reinvest the profit generated by a company in the business for expansion and growth. One can also pay out the profits to the owners as dividends, which face lower taxes than those incurred on salaries.

You can keep more of your earnings and minimize your tax liability by running a business.

This is one of the more controversial lessons taught by Robert T. Kiyosaki, where he says that hard work does not help you earn money; making strategic decisions does.

He discounts the philosophy that working hard and doing a good job will make you wealthy. Instead, he argues that the rich invent money, not earn it. They capitalize on opportunities, take risks, and create multiple passive income streams to acquire wealth.

The lesson?

Don’t work for money. Buy assets that will work to earn you money and deliver infinite returns. Some examples of such assets include

• Businesses that don’t require active supervision
• Rental properties that provide a passive income
• Financial investments that pay dividends over time

Another key takeaway from Rich Dad, Poor Dad is that the rich work to acquire skills, not to earn money.

If you work to earn a paycheck, you will never get out of the rat race and acquire real wealth. However, if you work to develop new skills, you will become more talented and open new earning opportunities for yourself in the long run.

This mindset shift directs people from aspiring for well-paying jobs to becoming entrepreneurs. He also emphasizes the importance of building marketable skills and uses McDonald’s as an example. 

When he asked a room full of people, “Who can make a better hamburger than McDonald’s?” almost everyone raised their hands. Yet, McDonald’s is a multi-billion dollar business. 

Everyone can make a great hamburger, but turning it into a profitable business is a more valuable skill. So, acquire marketable skills that help you earn money and work to upskill yourself, not to earn a paycheck.

Take risks to become rich. If you follow in the footsteps of everyone else, you will be a part of the crowd. If you want to escape the rat race, you must do something different. The rich try new things and explore various opportunities instead of letting them pass by. If you want to gain massive profits, you must take high risks.

Kiyosaki explains that job security differs from financial security. A secure job provides a false sense of security that could lead to complacency. External factors can always change that, and you may lose your job, no matter how secure you think it is.

However, investing in stocks, bonds, real estate, and other assets that create multiple income streams will make you financially secure. If one income stream is affected, you’ll still have many more.

Does that mean you must take unnecessary risks?

Absolutely not! He emphasizes the importance of taking calculated risks to achieve financial success. You must carefully weigh your options but don’t hesitate to bet on a good opportunity because of limiting beliefs and risk aversion.

The Five Big Ideas

Here are five big ideas from the book that you should understand and implement to achieve financial success.

The wealthy do not work for money but have their money work for them.

They invest in assets and create multiple passive income streams. Kiyosaki delved into the idea more in his second book ‘The Cashflow Quadrant.’

If you invest in others’ business—via stocks, for instance—you are letting your money work for you to generate more money. You’re not actively working for it, yet you’ll generate income and gather wealth over time.

Wealthy people build wealth by acquiring assets that generate income, such as stocks, bonds, and real estate.

Poor people acquire homes, cars, and other possessions that look like assets but are liabilities because they drain money.

The only money that makes any difference in your life is the money you save. You may earn a lot but pay taxes and spend it on essential expenses, leaving next to nothing with you.

Earning a lot of money doesn’t make you rich, but keeping most of it does. If you want to be wealthy, you need to learn how to maximize your tax savings and keep most of the money you make.

Earning money is the first step. To be wealthy, you need the financial aptitude to know what to do with that money.

Investing in financial assets is the best way to use your money and let it work for you. Buy stocks, bonds, rental properties, and other income-generating financial assets.

Financial literacy will help you gain financial intelligence and learn how to have your money earn more money.

Lastly, if you want to learn anything from the book Rich Dad, Poor Dad , let it be this—your mind is your most valuable asset.

It’s not your material possessions—house, car, etc.—or money or anything else.

If you have a keen mind and train it well to develop a strong financial IQ, you can gather wealth and become rich. It’s your mindset and values that you need to change. 

Change how you think about money, including how to earn and manage it, to change your financial status and become wealthy.

Rich Dad, Poor Dad is full of great quotes on personal finance and money management. It provides smart advice on how to make money, generate wealth, and change our mindsets about money.

Here are five inspirational quotes from the book. 

• “In the real world, the smartest people are people who make mistakes and learn. In school, the smartest people don’t make mistakes.”
• “The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth in what seems to be an instant.”
• “Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets.”
• “It’s not what you say out your mouth that determines your life. It’s what you whisper to yourself that has the most power.”
• “Workers work hard enough to not be fired, and owners pay just enough so that workers won’t quit.”

Rich Dad, Poor Dad teaches the fundamentals of financial management.

While it is good to set a firm foundation for good wealth management, there must be a comprehensive solution to manage your wealth practically.  If you’re looking for a useful tool to manage your cash flow, you must try ClickUp Finance .

Use it to create custom dashboards to track your income and expenses, manage project budgets , and manage your payments. ClickUp offers numerous finance and accounting templates to help you manage your finances without starting from scratch. 

Use these ClickUp Finance and Accounting Templates to create financial statements, manage accounts payables and receivables, and all other financial accounting tasks for your business.

The ClickUp accounting template is ideal for managing your business accounts, payables, and receivables. It is a customizable template that you can modify to your specific requirements.

If you agree with Rich Dad’s philosophy in Rich Dad, Poor Dad , you understand how important it is to track your expenses. The ClickUp Business Expense and Report Template can help you with that.

Use the ClickUp Cost-Benefit Analysis Template to weigh your strategic business decisions and risky financial investments.

Finally, check out ClickUp’s project budget templates to ensure each project remains profitable and you earn more than you spend. After all, that’s what the Rich Dad taught us—what matters is how much money we keep, not how much we earn. 

Overall, Rich Dad, Poor Dad is a book that will change your mindset about money and how to become rich. It teaches valuable concepts, bursts several myths, and gives you actionable information. 

Ready to put Robert T. Kiyosaki’s valuable financial lessons to practical use? 

Use ClickUp to simplify your business’s finance and accounting processes and focus on how you can tap on opportunities to generate wealth.

Sign up for free on ClickUp and explore its financial features and more!

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Napoleon Hill’s Think and Grow Rich Summary & Review

The top 12 best investing books for beginners in 2024, 6 books like rich dad poor dad you must read..., the simple path to wealth summary & book review (by..., rich dad poor dad review & summary – a life changing read.

Have you ever wondered why some people seem to have a magic touch with money while others struggle? Robert Kiyosaki’s eye-opening book, Rich Dad Poor Dad , might just have the answers. Imagine learning secrets from someone who has mastered the game of wealth – that’s what this book offers!

Are you looking for a Rich Dad, Poor Dad summary and review from a retired financial planner?

In Rich Dad Poor Dad , Kiyosaki shares his journey of growing up with two dads – his real dad (the “Poor Dad”) and the father of his best friend (the “Rich Dad”). Each dad taught him different lessons about money, success, and life . But here’s the twist: the Rich Dad, despite not having a college degree, built a fortune, while the Poor Dad, highly educated, struggled financially.

This book isn’t just a story; it’s a treasure trove of lessons on financial literacy and wealth building . It challenges the traditional belief that working hard and earning a salary is the way to wealth. Instead, it opens your eyes to the importance of financial education, investing , and understanding the difference between assets and liabilities .

Buy Rich Dad, Poor Dad on Amazon Today!

Are you curious about how to make your money work for you, instead of you working for money? Do you want to know the secrets of passive income and financial freedom ? Then, you’re in the right place! This summary & review will dive deep into Kiyosaki’s teachings, unraveling the wisdom behind wealth accumulation and financial independence .

Key Takeaways From Reading The Book Rich Dad, Poor Dad

Reflecting on Robert Kiyosaki’s influential work, several key takeaways emerge that can fundamentally alter one’s financial trajectory:

• Asset vs. Liability Mindset : Understanding the difference between assets that put money in your pocket and liabilities that take it out is crucial. This book teaches the art of discerning and investing in income-generating assets.
• Breaking the Paycheck Cycle : Kiyosaki emphasizes the importance of moving beyond the paycheck-to-paycheck existence. He encourages readers to educate themselves on investment strategies and seek opportunities for financial growth.
• Practical Financial Education : The book is not just about theoretical knowledge; it provides practical steps and tools for individuals to actively take control of their financial future.
• Investment and Risk Management : Learning to invest wisely and manage risks is a key theme. The book guides readers through the nuances of strategic investment and the importance of financial literacy.
• Empowerment Through Knowledge : Ultimately, “Rich Dad Poor Dad” empowers readers with the knowledge to make informed financial decisions, paving the way for financial independence and success.

Quick Links – Rich Dad Poor Dad Review

Rich dad poor dad summary: a tale of 2 mindsets.

In this book, Robert Kiyosaki draws from his own life experiences with two father figures – his biological father (the ‘Poor Dad’) and the father of his best friend (the ‘Rich Dad’). These two men represent contrasting financial philosophies:

Imagine standing at a crossroads: one path leads to a luxurious mansion, the other to a modest home. This is the visual metaphor for the financial choices outlined in “Rich Dad Poor Dad.”

• Poor Dad : Advocates traditional financial wisdom – get a good education, work hard, save money, and retire.
• Rich Dad : Encourages financial education, investing in assets, and understanding how money works to create wealth.

Kiyosaki’s journey through these contrasting views offers profound insights into how we can elevate our financial health. The book is more than a collection of advice; it’s a series of lessons in financial intelligence, risk-taking, and strategic investment.

Memorable quotes throughout the book serve as guideposts, steering readers toward smarter financial decisions and independence. It’s a roadmap for anyone looking to transform their financial mindset and embark on a journey to wealth and financial freedom.

In my deep dive into Robert Kiyosaki’s groundbreaking book, I’ll unravel the transformative views on personal finance and wealth building that have challenged and changed millions of lives.

The Core Philosophy: Rich Dad vs. Poor Dad

At the heart of Kiyosaki’s narrative is a stark contrast between two financial philosophies.

• The ‘Poor Dad,’ embodying a conservative, traditional approach, believes in the security of a regular job and a steady paycheck.
• In contrast, the ‘Rich Dad’ represents an entrepreneurial spirit, advocating for investing in assets and building wealth through savvy financial decisions.

Reshaping Our Financial Understanding

Kiyosaki doesn’t just narrate two different life paths; he looks into the psyche behind them. He urges readers to prioritize financial literacy , understanding the nuances of assets and liabilities, and the importance of making money work for you.

This book isn’t just about choosing between two paths; it’s about understanding the rules of the financial game and how to play it effectively.

“The rich think long term, the poor think short term.” Quotes from Rich Dad Poor Dad

The True Meaning of Wealth

One of the most striking revelations in “Rich Dad Poor Dad” is the redefinition of wealth. Kiyosaki argues that true wealth isn’t about earning a high salary; it’s about building and owning assets that generate income, even when you’re not actively working.

This paradigm shift from working for money to having money work for you is a game-changer.

The Financial Mindset Shift

Ultimately, Kiyosaki’s book is a call to action. It’s about adopting a mindset that embraces informed risk-taking, understands the power of investment, and sees beyond the traditional paycheck-to-paycheck living. This shift in mindset is what separates the financially successful from those who struggle.

• In ‘Rich Dad Poor Dad,’ Kiyosaki provides a compelling comparison between two distinct financial philosophies, each shaped by his own ‘dads.’
• The book encapsulates essential insights on how to elevate one’s financial health by shifting focus from merely earning to intelligently investing and creating assets.
• It’s peppered with memorable quotes that encapsulate the essence of Kiyosaki’s financial wisdom, serving as mental signposts guiding readers toward fiscal prudence and independence.

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Essential Book Insights: Discovering Financial Wisdom Through Two Fathers

What I Learned from “Rich Dad Poor Dad”

“The rich don’t work for money. The poor do.” Quotes From Rich Dad Poor Dad

• Be Smart with Money : The book tells us that it’s not just about how much money you make, but how you use it. It’s important to know the difference between things that make you money (assets) and things that cost you money (liabilities).
• Think About the Future : Instead of just working for money, think about how to make money work for you. This means learning about things like investing and starting a business.
• Learn About Money : School teaches us a lot, but not always about money. This book shows that learning about money is really important for everyone.
• Take Chances : Sometimes, to make money, you have to take risks. But these should be smart risks, where you’ve thought about what could happen.
• Work Hard, But Smart : It’s not just about working hard at a job. It’s also about working smart, like finding ways to make extra money without always having to do more work.

Why This Book is Important

“Rich Dad Poor Dad” is a great book because it makes us think differently about money. It tells us that anyone can learn to be better with money, and that it’s important to start learning early. This book is like a guide to help us make smart choices with our money.

“rich People buy assets, the poor only have expenses.” Quotes From Rich Dad Poor Dad

10 lessons from Rich Dad Por Dad

Book Review of Rich Dad Poor Dad

The Story’s Core:

“Rich Dad Poor Dad” is more than just a book; it’s a journey through contrasting financial ideologies. Kiyosaki’s narrative, rooted in his experiences with two father figures, offers a unique perspective on wealth and money management. The ‘poor dad,’ his biological father, represents traditional financial beliefs, while the ‘rich dad,’ a mentor, embodies a more progressive, investment-focused approach.

Author’s Background: The Credibility Factor

Robert Kiyosaki’s background as an entrepreneur and educator in finance adds depth and authenticity to his teachings. His real-life experiences and dual roles provide a practical and relatable approach to financial education, making complex concepts accessible to a broad audience.

Why This Book Matters

“Rich Dad Poor Dad” isn’t just a guide; it’s a transformative experience. It challenges deep-seated beliefs about money and employment, urging readers to adopt a proactive approach to wealth creation. The book’s emphasis on financial literacy and independence is not just educational but a call to action for personal financial revolution.

My Personal Takeaway

As a reader, “Rich Dad Poor Dad” has been a revelation. The book’s lessons on the distinction between assets and liabilities, and the importance of financial literacy, have reshaped my understanding of wealth and financial strategy. Kiyosaki’s approach to earning and investing is a wake-up call to rethink traditional financial paths.

The Impact: Unlocking Financial Wisdom

This book is a key to unlocking financial wisdom. It’s not just about accumulating wealth; it’s about fostering a mindset that prioritizes financial education and smart investing. Kiyosaki’s straightforward explanation of complex financial concepts makes the book an invaluable resource for anyone on the path to financial freedom.

Recommendation

I highly recommend “Rich Dad Poor Dad” to anyone looking to enhance their financial understanding and embark on a journey toward economic empowerment. It’s a must-read for those seeking practical wisdom and strategies for wealth-building in today’s world.

Book Advantages & Drawbacks

Many aspects of ‘Rich Dad Poor Dad’ have significantly influenced my approach to financial literacy, yet some elements of the book may not resonate with every reader. The Advantages of the book are substantial, offering a fresh perspective on money that challenges conventional wisdom.

However, the Drawbacks of the book, such as the one-size-fits-all approach, might not suit everyone’s individual financial situation.

Analyzing the book through this lens, it’s clear that while it’s a powerful tool for financial awakening, it’s not without its limitations.

Diverse Perspectives: A Community’s Take on Kiyosaki’s Teachings

Don’t just take my word for it. I have also consolidated other viewpoints about the book for you as well…

A Balanced Look: Reviews from Book Rating Websites

The reviews on various book rating websites present a kaleidoscope of opinions on “Rich Dad Poor Dad.” Many readers applaud the book for its clear and impactful insights into financial literacy and wealth-building. They appreciate Kiyosaki’s knack for simplifying complex financial concepts, making them accessible to a broad audience.

Quotes from the book, like “The rich see opportunities, the poor see obstacles,” resonate with many, encapsulating the essence of Kiyosaki’s philosophy.

However, some reviews offer a counterpoint, critiquing the book for its seemingly oversimplified approach to complex financial systems. Despite these differing views, the book is widely recognized as a thought-provoking piece that encourages readers to reassess their financial strategies.

“The rich see opportunities, the poor see obstacles.” Quotes from Rich Dad Poor Dad

Amazon & Reddit’s Candid Opinions

Here’s a table summarizing the diverse opinions from book rating websites, Amazon customer feedback, and Reddit discussions on “Rich Dad Poor Dad”:

This table provides a balanced overview of the varying perspectives on “Rich Dad Poor Dad,” highlighting its impact and the discussions it has sparked in different communities.

Despite these disparities, the consensus acknowledges the book as an eye-opener, stirring readers to reevaluate their financial strategies and prioritize the growth of assets over mere income.

Similar Books To Read

Beyond the insights gleaned from Amazon and Reddit, I’m eager to explore books similar to ‘Rich Dad Poor Dad’ that have also challenged and reshaped others’ financial perspectives. When seeking similar book recommendations, I look for those that offer a blend of transformative ideas and practicable advice for implementing financial strategies.

If you are interested in this book, you may want to check out the Best Books Like Rich Dad Poor Dad as well.

• ‘The Millionaire Next Door’ by Thomas J. Stanley and William D. Danko : This book delves into the common traits of those who’ve accumulated wealth, emphasizing frugality and smart investing.
• Think and Grow Rich by Napoleon Hill : A classic that explores the psychological power of thought in achieving personal wealth.
• The Richest Man in Babylon by George S. Clason It offers timeless parables about the fundamentals of saving, investing, and financial planning.
• The Millionaire Fastlane by MJ DeMarco
• The Millionaire Mindset by Gerry Robert
• The Cashflow Quadrant by Robert Kiyosaki
• The 7 Habits of Highly Effective People by Stephen Covey

Summarizing the Key Insights:

In wrapping up this insightful journey through the realms of personal finance, let’s revisit the essential nuggets of wisdom we’ve unearthed. Our exploration has not only equipped us with practical advice but also instilled a sense of empowerment in our financial decision-making.

• Financial Literacy: The cornerstone of our discussion, understanding the nuances of assets and liabilities, is pivotal. It’s not just about earning; it’s about making your earnings work for you.
• Investment Strategies: We looked into the art of investing wisely, emphasizing the importance of informed risk-taking and strategic financial planning.
• Breaking the Paycheck Cycle: We underscored the significance of transcending the paycheck-to-paycheck lifestyle, advocating for a proactive approach to wealth accumulation.

As someone who has navigated the complexities of financial planning, I can attest to the transformative power of these principles. They are not just theories but practical tools that can lead to a more secure and prosperous future.

What’s your biggest financial goal, and how do you plan to achieve it? Is it financial literacy , investment strategies , and wealth accumulation ? Share your thoughts and join the conversation below. Your insights could be the catalyst for someone else’s financial breakthrough.

Embarking on your journey to financial literacy and independence can be the most rewarding decision of your life. Remember, it’s not just about wealth accumulation; it’s about creating a life of financial freedom and security.

Are you ready to take control of your financial future? I encourage you to subscribe to our newsletter for more insights, or schedule a consultation to personalize your financial journey. Your path to financial freedom starts here.

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Note: The content provided in this article is for informational purposes only and should not be considered as financial or legal advice. Consult with a professional advisor or accountant for personalized guidance.

The book is 336 pages. Created by Robert Kiyosaki, “Rich Dad Poor Dad” is a book that stresses the importance of financial literacy and teaches the reader how to acquire and use wealth. The book sold over 32 million copies and has been translated into over 51 languages. If you do nto want to read the book – consider listening to the audiobook of Rich Dad Poor Dad.

While some may find Kiyosaki’s views controversial, “rich dad poor dad” is an interesting and thought-provoking read. There are many different ways to view success. In “rich dad poor dad” by Robert Kiyosaki, he looks at success through the lens of wealth. Kiyosaki argues that the traditional mindset of going to school, getting good grades, and finding a stable job is not the best path to riches. Instead, he advocates for taking risks, starting businesses, and investing in assets.

The answer is yes and no. The details are embellished, but the overall story is mostly true. In the book, “Rich Dad Poor Dad”, author Robert Kiyosaki talks about his two father figures – his birth father and his best friend’s father. He paints a picture of growing up with two completely different types of dads. His birth father was a highly educated man who worked hard for his family, but was never able to get ahead financially. On the other hand, his best friend’s father was a self-made millionaire who always seemed to have money to spare. Kiyosaki uses his experience growing up with these two very different men to explain some basic principles of financial success. So, is “Rich Dad Poor Dad” a true story? While the book is based on Kiyosaki’s own life, some of the details have been changed or embellished in order to make a more compelling story. However, the overall message – that financial success is more about mindset than anything else – is true. If you’re looking for a true story about growing up with two very different father figures, this book is definitely worth a read.

The book rich dad poor dad is written by Robert Kiyosaki. It is a story about his two dads, one rich and one poor, and the lessons he learned from them about money.

In 1974, two young men graduated from the same college, in the same month, and with the same degree. They both had plans to become rich. One was my rich dad and the other was my poor dad. This is a story about two fathers, one rich and one poor, and the different lessons they taught their sons about money. Robert Kiyosaki, the author, grew up with two very different role models for money and success. His rich dad was a successful businessman who taught him the importance of investing and creating passive income. His poor dad was a well-educated government employee who taught him the importance of working hard and saving his money. Kiyosaki argues that the rich dad’s lessons were more valuable and have helped him become more successful than his poor dad.

Rich Dad Poor Dad is a book that tells a different story. It is the story of Robert Kiyosaki and his two fathers – his real father (poor dad) and the father of his best friend (rich dad). Kiyosaki found that his rich dad’s advice led to a life of financial freedom, while his poor dad’s advice left him struggling to make ends meet. The book has four main lessons: 1. You must learn to work to make money, not the other way around. 2. Your primary purpose in life should be to acquire assets, not to acquire liabilities. 3. The rich focus on opportunities, not on jobs. 4. The rich know that time, not money, is their most important asset. Rich Dad Poor Dad is a book that advocates financial independence through asset acquisition. The book provides four main lessons on how to acquire assets, how to think about work, and the role of time in building wealth.

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Rich Dad Poor Dad Book Summary, Review, Notes

Rich Dad Poor Dad by Robert Kiyosaki and Sharon Lechter is a book that came out in 1997 and focuses on the importance of financial literacy from an early age. 

Throughout the book, the author explains how a person can increase their wealth by investing in assets and by being smart with money.

https://www.youtube.com/watch?v=Xi7wpeqY9zs&t

Book Title—  Rich Dad Poor Dad Author —  Robert Kiyosaki, Sharon Lechter Date of Reading—   February, 2023 Rating—   9/10

https://www.youtube.com/watch?v=ATrKaXZbmng

What Is Being Said In Detail

Rich Dad Poor Dad follows snippets of Robert Kiyosaki’s childhood as he starts learning about money from the young age of nine. 

The name of the book comes from Kiyosaki’s real father who was the “poor dad” and his friend’s father who was the “rich dad”. 

His real father was a professor who earned a lot yet always struggled financially, while his friend’s father, an entrepreneur who left school at an early age ended up as one of the richest people in Hawaii. 

Kiyosaki often tried to understand the perspective of both his rich dad and poor dad, however, his rich dad’s advice is what helped him gain knowledge of finances and acquire wealth.

The book introduces the concepts of cash flow, balance sheet, income statement, assets, and liabilities in a simple manner, easy for everyone to understand. 

The author wishes that everyone was taught the basics of finances from childhood like he was, which he lists as one of the reasons for writing this book. 

The importance of knowing the difference between assets and liabilities and focusing on investing in assets is emphasized through multiple chapters and called “the number one and the only rule”.

Rich Dad Poor Dad consists of 10 chapters and an epilogue. 

Chapters contain simple explanations of basic finance concepts, often followed by pictures and examples from the author’s life or from his family and friends.

Introduction

Introduction explains the idea behind the book and emphasizes the importance of financial literacy over the standard, outdated education received at school. 

In the wake of constant global and technological changes, knowledge of finances might just be of the greatest use for financial independence.

Chapter One 

Chapter 1 highlights the contrast between Robert’s rich dad and poor dad,  as it shows both of their perspectives on money and wealth. 

Robert decides to follow the rich dad’s advice, which were based on six lessons: 

• The Rich Don’t Work for Money, 
• Why Teach Financial Literacy, 
• Mind Your Own Business, 
• The History of Taxes and the Power of Corporations, 
• The Rich Invent Money, and 
• Work to Learn Don’t Work for Money.

Chapter Two – Lesson One: The Rich Don’t Work For Money

In Chapter 2 Robert and his friend Mike ask Mike’s dad, the rich dad, to teach them how to be wealthy and successful. 

They start working for him every Sunday, and at the age of 9 learn what it is like to live as an average adult – earning money and spending it. Rich dad advises them to use their head over emotions when it comes to money.

Chapter Three – Lesson Two: Why Teach Financial Literacy?

In Chapter 3 Robert speaks about, as he says, ‘rule number one and the only rule’, which goes as follows “You must know the difference between an asset and a liability, and buy assets”. 

This chapter contains simple drawings explaining the basics of cash flow, income statements, and balance sheets.

Chapter Four – Lesson Three: Mind Your Own Business

Chapter 4 suggests that a person should focus on increasing their assets and in that way “work for themselves”, instead of working and earning money for someone else their whole lives (for employer, government, bank).

Chapter Five – Lesson Four: The History of Taxes and The Power of Corporations

Chapter 5 talks about the history of taxes and how understanding that concept and making it work to one’s advantage makes the difference between the rich and poor or middle class. 

The importance of financial IQ is also mentioned and it is based on four areas: accounting, investing, understanding markets, and the law. 

Chapter Six – Lesson Five: The Rich Invent Money

Throughout Chapter 6 Robert explains how even “risky” investments are not gambling if one knows what they are doing; it becomes gambling “if you’re just throwing money into a deal and praying”. 

He argues that financial intelligence is knowing how to take good opportunities that come your way. 

Kiyosaki also talks about CASHFLOW, the investment game he came up with in order to make investing easier to comprehend for people with different backgrounds

Chapter Seven – Lesson Six: Work to Learn – Don’t Work for Money

Chapter 7 describes how knowing a little bit about a lot is better than specializing in just one thing. 

Kiyosaki notes that the main management skills needed for success are management of cash flow, management of systems, and management of people.

Chapter Eight – Overcoming Obstacles

Chapter 8 states five reasons why even financially literate people might not acquire assets that will produce a satisfying cash flow.

•     Fear . Overcoming fear is learning how to manage it and accept failure. Kiyosaki suggests that losers avoid failing, while failure turns losers into winners.
•     Cynicism . The best way to defeat cynicism is to analyze because by doing so, we identify opportunities that critics most likely miss.
•     Laziness . Instead of being lazy and saying we cannot do something, one should be a little greedy by searching for answers and solutions to their issue.
•     Bad habits . The solution for bad habits is the motivation that fuels us to work harder and be smarter when it comes to money.
•     Arrogance . The cure to arrogance is realizing and accepting our ignorance, and choosing to educate ourselves on the subject.

Chapter Nine – Getting Started

Chapter 9 offers ten steps to awaken financial genius:

•     Find a reason greater than reality: the power of spirit . Strong sense of purpose is needed to do most things in life.
•     Make daily choices: the power of choice . We make a choice of what to think, what to do with our time and money, and so on.

Another important thing to note is that a person needs to stay true to themselves on the road to wealth.

Rather than what we know, how fast we learn is more important in the information age.

•     Pay yourself first: the power of self-discipline . Self-control and a high tolerance for financial pressure are necessary to become rich.
•     Pay your brokers well: the power of information . As Robert says, the more money brokers make, the more money we make.
•     Be an Indian giver: the power of getting something for nothing . The first thing investors should think about is how to get their money back quickly.
•     Use assets to buy luxuries: the power of focus . Use assets instead of liabilities to buy luxuries.
•     Choose heroes: the power of myth . Emulating our heroes makes things look easier and inspires us.

If we want knowledge, money, or information, we should first give those things to others in order to receive them.

Chapter Ten – Still Want More? Here are Some To Do’s

In Chapter 10 the author shares some practical steps on how to start the journey of financial literacy and wealth, such as looking for new ideas, finding someone who has done what we want to do, taking classes, reading and attending seminars, making a lot of offers, and learning from history.

One of the more compelling steps instructs that “ action beats inaction ”.

In Epilogue the reader is offered an example of how to afford education for children and provide for retirement based on the case of Robert Kiyosaki’s friend. 

The author also invites the reader to learn how to make money work for them and therefore have an easier and happier life.

Most Important Keywords, Sentences, Quotes

Introduction.

“Getting a good education and making good grades no longer ensures success, and nobody seems to have noticed, except our children.”

“At my table was a banker, a business owner and a computer programmer. 

What greatly disturbed me was how little these people knew about either accounting or investing, subjects so important in their lives.”

“He knows that the world has changed, but education has not changed with it. 

According to Robert, children spend years in an antiquated educational system, studying subjects they will never use, preparing for a world that no longer exists.”

“Remember that financial intelligence is the mental process via which we solve our financial problems.”

CHAPTER ONE 

“Both men offered me advice, but they did not advise the same things. Both men believed strongly in education but did not recommend the same course of study.”

“Although both dads worked hard, I noticed that one dad had a habit of putting his brain to sleep when it came to money matters, and the other had a habit of exercising his brain. 

The long-term result was that one dad grew stronger financially and the other grew weaker.”

“My poor dad would also say, ‘I’m not interested in money,’ or ‘Money

doesn’t matter.’ My rich dad always said, ‘Money is power.’”

CHAPTER TWO – Lesson One: The Rich Don’t Work For Money

“Most of the time, life does not talk to you. It just sort of pushes you around.

Each push is life saying, ‘Wake up. There’s something I want you to learn.’”

“Or if you’re the kind of person who has no guts, you just give up every time life pushes you. If you’re that kind of person, you’ll live all your life playing it safe, doing the right things, saving yourself for some event that never happens.”

“I’ll bet you that I earn more than your dad, yet he pays more in taxes.”

“They work very hard, for little money, clinging to the illusion of job security, looking forward to a three-week vacation each year and a skimpy pension after forty-five years of work.”

“Let me finish the other emotion, which is desire. Some call it greed, but I prefer desire. It is perfectly normal to desire something better, prettier, more fun or exciting.”

“The main cause of poverty or financial struggle is fear and ignorance, not the economy or the government or the rich. It’s self-inflicted fear and ignorance that keeps people trapped.”

CHAPTER THREE – Lesson Two: Why Teach Financial Literacy?

“Our assets are large enough to grow by themselves. It’s like planting a tree. You water it for years, and then one day it doesn’t need you anymore.”

“Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets.”

“An intelligent adult often feels it is demeaning to pay attention to simplistic definitions.”

“Rich dad believed in the KISS principle—Keep It Simple, Stupid (or Keep It Super Simple)—so he kept it simple for us, and that made our financial foundation strong.”

“‘In accounting,’ rich dad would say, ‘it’s not the numbers, but what the numbers are telling you. It’s just like words.’”

“Cash flow tells the story of how a person handles money.”

“What is missing from their education is not how to make money, but how to manage money.”

“A person can be highly educated, professionally successful, and financially illiterate.”

CHAPTER FOUR – Lesson Three: Mind Your Own Business

“To become financially secure, a person needs to mind their own business.”

“The better I was at understanding the accounting and cash management, the better I would be at analyzing investments and eventually starting and building my own company.”

“An important distinction is that rich people buy luxuries last, while the poor and middle class tend to buy luxuries first.”

CHAPTER FIVE – Lesson Four: The History of Taxes and The Power of Corporations

“My rich dad did not see Robin Hood as a hero . He called Robin Hood a crook.”

“It was difficult to go to work for one of the biggest capitalists in town and come home to a father who was a prominent government leader. It was not easy to know which dad to believe.”

“The harder you work, the more you pay the government.”

“If you work for money , you give the power to your employer. If money works for you, you keep the power and control it.”

“My money was working hard to make more money. Each dollar in my asset column was a great employee, working hard to make more employees and buy the boss a new Porsche with before-tax dollars.”

CHAPTER SIX – Lesson Five: The Rich Invent Money

“We all have tremendous potential, and we all are blessed with gifts. Yet the one thing that holds all of us back is some degree of self-doubt.”

“Old ideas are their biggest liability. It is a liability simply because they fail to realize that while that idea or way of doing something was an asset yesterday, yesterday is gone.”

“Most people have an opportunity of a lifetime flash right in front of them, and they fail to see it. A year later, they find out about it, after everyone else got rich.”

“Financial intelligence is simply having more options.”

“The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth.”

“Another case for developing your financial intelligence over a lifetime is simply that more opportunities are presented to you.”

“It is not gambling if you know what you’re doing. It is gambling if you’re just throwing money into a deal and praying.”

“Great opportunities are not seen with your eyes. They are seen with your mind.”

CHAPTER SEVEN – Lesson Six: Work to Learn – Don’t Work for Money

“I am constantly shocked at how little talented people earn.”

“‘You want to know a little about a lot’ was rich dad’s suggestion.”

“Job is an acronym for ‘Just Over Broke.’”

“Once people are trapped in the lifelong process of bill-paying, they become like those little hamsters running around in those metal wheels.”

“So I wonder: Are workers looking into the future or just until their next paycheck, never questioning where they are headed?”

“I know of no other skills to be more important than selling and marketing.”

“The better you are at communicating, negotiating, and handling your fear of rejection, the easier life is.”

CHAPTER EIGHT – Overcoming Obstacles

“The primary difference between a rich person and a poor person is how they manage that fear.”

“For most people, the reason they don’t win financially is because the pain of losing money is far greater than the joy of being rich.”

“Losers avoid failing. And failure turns losers into winners.”

“Rich dad explained that criticism blinded while analysis opened eyes. Analysis allowed winners to see that critics were blind, and to see opportunities that everyone else missed. And finding what people miss is key to any success.”

“So what is the cure for laziness? The answer is—a little greed.”

“If I pay myself first I get financially stronger, mentally and fiscally.”

“When you know you are ignorant in a subject, start educating yourself by finding an expert in the field or a book on the subject.”

CHAPTER NINE – Getting Started

“A reason or a purpose is a combination of ‘wants’ and ‘don’t wants’.”

“I’ve learned that, without a strong reason or purpose, anything in life is hard.”

“Financially, with every dollar we get in our hands, we hold the power to choose our future: to be rich, poor, or middle class.”

“In today’s fast-changing world, it’s not so much what you know anymore that counts, because often what you know is old. It is how fast you learn.”

“Simply put, people who have low self-esteem and low tolerance for financial pressure can never be rich.”

“Too often today, we focus on borrowing money to get the things we want instead of focusing on creating money.”

“Copying or emulating heroes is true power learning.”

“Whenever you feel short or in need of something, give what you want first and it will come back in buckets.”

CHAPTER TEN – Still Want More? Here are Some To Do’s

“The definition of insanity is doing the same thing over and over and expecting a different result.”

“I also attend and pay for expensive seminars on what I want to learn. I am wealthy and free from needing a job simply because of the courses I took.”

“Without financial training, we all too often use the standard formulas to get through life: Work hard, save, borrow, and pay excessive taxes. Today, more than ever, we need better information.”

“It takes only a few dollars to start and grow it into something big.”

“With each dollar bill that enters your hand, you and only you have the power to determine your destiny. Spend it foolishly, you choose to be poor. Spend it on liabilities, you join the middle class. 

Invest it in your mind and learn how to acquire assets and you will be choosing wealth as your goal and your future.”

Book Review (Personal Opinion):

I often heard about this book but the thought of reading it has not crossed my mind until recently, and I am very glad that I decided to do so. 

Even with some background knowledge of finances and accounting, the book somehow broke it down and helped me understand the practical and real-life aspects instead of just theoretical ones. 

The whole point of the book was the author explaining to the readers these concepts the way it was explained to him when he was a child – simple and comprehensible.

The chapter builds on each other and it starts from the pure basics – the difference between assets and liabilities, and continues onto the history of taxes, overcoming setbacks on road to financial literacy, and other useful topics. 

My favorite part was the last chapter which gave us practical advice for beginners to implement to become wealthy and financially independent. 

Rating : 9/10

This Book Is For:

•  Parents who want to teach their children to be responsible and smart with money
•  Young individuals who seek wealth and independence and need a place to start
•  People who want to invest in assets such as real estate

If You Want To Learn More

Robert Kiyosaki explains how you can make money from nothing and other topics contained in his book in this 2018 interview at New Orleans Investment Conference . 

How I’ve Implemented The Ideas From The Book

This book motivated me to start taking matters into my own hands through small steps. 

I started reading about investing and subscribed to the Wall Street Journal, where I sometimes spend hours reading articles on current business affairs and following stock market news.

One Small Actionable Step You Can Do

Kiyosaki mentions the educational board game he came up with multiple times in the book, called CASHFLOW. 

It is a game designed for people who want to learn the fundamentals of investing through a fun simulation. Try playing it for free on Kiyosaki’s website www.richdad.com and see how well you understand the principles explained in the book.

Rich Dad Poor Dad Summary

The “Rich Dad Poor Dad” book by Robert Kiyosaki contrasts the financial philosophies of Kiyosaki’s two father figures. His biological father, the ‘Poor Dad’, believed in traditional education and a stable job. In contrast, his friend’s father, the ‘Rich Dad’, advocated for financial literacy and investing. The book highlights key lessons: the importance of understanding money, differentiating assets from liabilities, investing in income-generating assets, learning valuable skills over earning, and adopting a mindset that embraces opportunities and solutions. The overarching theme is the significant impact of financial education and mindset on wealth building.

Please note: This is an unofficial summary and workbook created to help you understand and apply the principles outlined in the book. For full disclaimer details, click here .

Each of the following topics captures a fundamental aspect of the philosophy presented in “Rich Dad Poor Dad,” providing a comprehensive overview of the book’s key teachings on personal finance and wealth building. We offer a printable PDF version below.

Financial Education vs. Traditional Education: The importance of financial literacy compared to conventional academic education.

In “Rich Dad Poor Dad,” Robert Kiyosaki contrasts the value of financial education with traditional academic education. He argues that conventional education systems often neglect to teach students about money management, investing, and wealth creation, which are crucial skills for financial success. Traditional education focuses more on academic and professional skills, preparing individuals for employment, but does not typically equip them with the knowledge to manage finances, invest wisely, or accumulate wealth.

Key Aspects:

• Lack of Financial Training in Traditional Education : Traditional schooling teaches many valuable skills but often fails to cover basic financial management, investment strategies, and ways to generate passive income.
• The Importance of Financial Literacy : Kiyosaki emphasizes that financial literacy, including understanding how money works, how to make it work for you, and how to manage it, is essential for financial independence and wealth building.
• Educational System’s Focus on Employment : Traditional education systems are geared towards producing good employees, not necessarily financially savvy individuals or entrepreneurs.
• Self-Education in Finance : Take the initiative to learn about personal finance, investing, real estate, stocks, and taxes through books, courses, and online resources.
• Practical Financial Experiences : Engage in practical experiences such as budgeting, investing small amounts in stocks or mutual funds, or even starting a small side business.
• Seek Alternative Learning Opportunities : Attend workshops, seminars, and talks on financial topics. Look for opportunities to learn from financial experts and successful investors.
• Apply Learning to Personal Finances : Regularly review and manage your personal finances, investments, and savings strategies based on your growing knowledge.
• Encourage Financial Discussions : Start discussions with friends or family about financial topics, sharing knowledge and learning from each other’s experiences.
• Continual Learning and Adaptation : Stay updated on financial news, market trends, and emerging investment opportunities. Adapt your financial strategies as you gain more knowledge and experience.

This detailed summary and action items highlight the contrast between traditional and financial education as discussed in “Rich Dad Poor Dad,” underscoring the importance of proactively seeking financial knowledge and applying it to achieve financial success and independence.

Assets vs. Liabilities: Understanding the difference and focusing on acquiring assets.

In the “Rich Dad Poor Dad” book, a core principle is understanding the difference between assets and liabilities. Robert Kiyosaki defines assets as things that put money into your pocket, such as investments, real estate, stocks, or businesses that generate income. Conversely, liabilities are defined as things that take money out of your pocket, like loans, expenses, and any financial obligations that do not produce income. The book emphasizes the importance of accumulating assets over liabilities for long-term financial growth and stability.

• Misconceptions About Assets : Commonly, people mistake possessions like homes and cars for assets, but if these items don’t generate income, they are actually liabilities.
• Focus on Income-Generating Assets : True assets are those that produce a steady flow of income, such as rental properties, dividend-paying stocks, or profitable businesses.
• Reducing and Managing Liabilities : Understanding that minimizing liabilities is as important as acquiring assets for financial health.
• Assess Your Financial Situation : Start by distinguishing your own assets and liabilities. Create a balance sheet listing all your assets and liabilities to understand your financial standing.
• Educate Yourself on Income-Generating Assets : Learn about different types of assets, such as real estate for rental income, stocks for dividends, and other investment opportunities that can generate passive income.
• Plan to Acquire Assets : Set specific goals for acquiring new assets. This could include saving for a down payment on a rental property, investing in a diversified stock portfolio, or starting a side business.
• Minimize and Manage Liabilities : Look for ways to reduce liabilities. This could involve paying off high-interest debt, avoiding unnecessary loans, or reducing major expenses that don’t contribute to wealth accumulation.
• Invest Wisely : Before investing in any asset, conduct thorough research or seek advice from financial advisors to ensure you make informed decisions.
• Monitor and Adjust Your Portfolio : Regularly review your asset and liability balance. Adjust your strategies as needed to ensure you’re continuously increasing your net worth.
• Create a Long-Term Financial Plan : Develop a plan that aligns with your financial goals, focusing on increasing assets while managing and reducing liabilities.

This summary and set of action items encapsulate the crucial concept from “Rich Dad Poor Dad” regarding assets and liabilities, offering a roadmap to financial literacy and effective wealth management.

The Power of Mindset in Wealth Building: How different attitudes towards money can lead to different financial paths.

“Rich Dad Poor Dad” emphasizes the critical role of mindset in achieving financial success. Robert Kiyosaki illustrates how a person’s attitude towards money can significantly influence their financial path. He contrasts the mindsets of his “Rich Dad” and “Poor Dad” – the former viewing money as a tool for wealth creation and the latter seeing it as a means to pay bills. The book advocates for a mindset shift from viewing money as something you work for to something that can work for you, emphasizing the importance of thinking like an investor or entrepreneur rather than just an employee.

• Scarcity vs. Abundance Mindset : Understanding that a scarcity mindset can limit financial growth, while an abundance mindset opens up possibilities for wealth creation.
• Seeing Opportunities, Not Obstacles : Learning to identify and seize financial opportunities, instead of being deterred by risks and challenges.
• The Entrepreneurial Mindset : Thinking beyond traditional employment to consider ways to create and grow personal wealth, such as starting a business or investing.
• Cultivate an Abundance Mindset : Regularly remind yourself that financial resources aren’t limited and that with the right strategies, you can create more wealth.
• Identify and Overcome Limiting Beliefs : Reflect on any beliefs you have about money that may be holding you back, such as fear of risk or a belief that wealth is unattainable, and actively work to change these perceptions.
• Educate Yourself on Financial Opportunities : Stay informed about various investment opportunities, market trends, and entrepreneurial ventures.
• Practice Seeing Opportunities in Challenges : Whenever faced with a financial challenge, train yourself to look for potential opportunities or learning experiences within it.
• Develop an Entrepreneurial Approach : Even if you are in traditional employment, look for ways to adopt an entrepreneurial attitude, such as being proactive, innovative, and solution-focused.
• Set Goals and Visualize Success : Regularly set financial goals and visualize achieving them, reinforcing the belief in your ability to create wealth.
• Network with Like-Minded Individuals : Surround yourself with people who have a positive and abundant mindset about money and wealth. This could be through networking events, online communities, or mentorship programs.
• Reflect and Adjust Regularly : Take time periodically to reflect on your financial decisions and mindset, and be open to adjusting your approach as you learn and grow.

This detailed summary and action plan encapsulate the essence of the third point in “Rich Dad Poor Dad,” focusing on the transformative power of mindset in wealth building and financial success.

The Importance of Investing: Why investing in stocks, real estate, and businesses is crucial for wealth accumulation.

In the “Rich Dad Poor Dad” book, Robert Kiyosaki places a strong emphasis on the importance of investing as a key component to financial success. The book differentiates between working for money and having your money work for you. Kiyosaki argues that the pathway to wealth is through smart investments in assets such as real estate, stocks, and businesses. He underscores that investing isn’t just about having large amounts of money; it’s more about making informed, strategic decisions with the money you have, regardless of the amount.

• Investing vs. Saving : Understanding the difference between merely saving money and actively investing it to generate more wealth.
• Risk and Return : Recognizing that all investments carry some risk and learning how to balance risk with the potential for returns.
• Diversification : The importance of not putting all your financial resources into one type of investment, but spreading them across different asset classes.
• Start with Financial Education : Before diving into investing, educate yourself on various investment options, market trends, and financial principles.
• Assess Your Financial Situation : Understand your current financial standing, including your risk tolerance, investment goals, and available capital for investing.
• Start Small and Scale Up : Begin with small, manageable investments to gain experience and confidence. As your knowledge grows, you can gradually increase your investment size.
• Diversify Your Investments : Don’t concentrate all your resources in one type of investment. Spread your investments across different assets like stocks, bonds, real estate, or starting a small business.
• Understand and Manage Risks : Learn to evaluate the risks associated with different investments and develop strategies to manage them.
• Stay Informed and Adapt : Keep abreast of financial news and market changes. Be prepared to adapt your investment strategy as market conditions change.
• Set Clear Investment Goals : Define what you want to achieve with your investments, whether it’s building retirement savings, generating passive income, or accumulating wealth for other specific purposes.
• Seek Professional Advice When Needed : Don’t hesitate to consult with financial advisors or investment professionals, especially when making significant investment decisions.
• Regularly Review Your Investment Portfolio : Periodically assess your investments to ensure they align with your financial goals and adjust as needed.

This detailed summary and action plan address the fourth key point from “Rich Dad Poor Dad,” highlighting the critical role of investing in achieving financial independence and long-term wealth creation.

Work to Learn, Not Just for Money: The value of gaining skills and experiences that lead to long-term financial success.

Robert Kiyosaki emphasizes the importance of working to learn valuable skills and experiences, rather than solely for a paycheck. This principle challenges the conventional mindset of working primarily for money. Kiyosaki advocates for choosing positions and opportunities that offer the most learning potential, especially in areas that contribute to financial intelligence, such as sales, marketing, investment, and management. The idea is that the skills and knowledge gained can later be leveraged to create wealth, rather than relying solely on a salary for financial security.

• Value of Diverse Skill Sets : Understanding that a broad skill set, particularly in areas related to finance and business, is invaluable for long-term wealth building.
• Learning Over Earning in the Short Term : The concept of prioritizing opportunities for learning and growth, even if they don’t offer the highest immediate financial return.
• Developing Financial Intelligence : Gaining skills that contribute directly to your ability to make, manage, and invest money effectively.
• Identify Learning Opportunities in Your Career : Look for roles or projects within your current job that can expand your skill set, especially in areas like finance, negotiation, leadership, and strategic thinking.
• Consider Jobs or Roles for Their Learning Value : When evaluating job offers or career moves, consider the learning opportunities they offer, not just the salary.
• Pursue Education and Training : Actively seek out workshops, courses, or seminars that can enhance your financial knowledge and business skills.
• Learn from Mentors and Experienced Individuals : Find mentors who have achieved financial success and can provide guidance and insights. This could be a successful entrepreneur, a seasoned investor, or a leader in your field. Engaging with mentors can provide practical, real-world advice that complements formal education.
• Volunteer or Take on Side Projects : Consider volunteering for roles or projects, especially those that allow you to work in areas like budgeting, investing, or strategic planning. This hands-on experience can be invaluable.
• Participate in Networking Events : Engage in industry events, conferences, or online forums where you can learn from others, share experiences, and gain new perspectives on wealth building and financial management.
• Set Personal Development Goals : Create specific, measurable goals for your personal and professional development. This could include mastering a new financial software, understanding a particular market, or developing leadership skills.
• Read and Stay Informed : Regularly read books, articles, and reports related to finance, business, and investment. Staying informed about market trends and economic principles is crucial for developing financial intelligence.
• Practice Financial Decision Making : Apply what you learn by making small, low-risk financial decisions, whether it’s investing a small amount in stocks or creating a budget. The experience gained from these decisions can be very educational.
• Reflect and Adapt : Regularly reflect on what you are learning and how it applies to your financial goals. Be open to adapting your approach as you gain more knowledge and experience.

Overcoming Financial Fear and Ignorance: How fear and lack of knowledge can be major barriers to financial independence.

In the “Rich Dad Poor Dad” book, Robert Kiyosaki discusses the importance of overcoming fear and ignorance regarding financial matters. Fear, particularly the fear of losing money, often prevents individuals from making wise financial decisions or taking opportunities that could lead to wealth. Similarly, ignorance about how money works can lead to missed opportunities and financial mistakes. Kiyosaki emphasizes that educating oneself about finance and adopting a positive, proactive approach towards financial risk are key to overcoming these barriers.

• Fear of Financial Loss : Many people avoid investing or starting businesses due to the fear of losing money. This fear can be paralyzing and prevent financial growth.
• Lack of Financial Knowledge : A lack of understanding about investing, markets, and financial strategies can lead to poor decisions and missed opportunities.
• The Role of Emotions in Finance : Emotions can significantly impact financial decisions. Learning to manage them is crucial for success.
• Educate Yourself Financially : Start by learning the basics of personal finance, investment, and the principles of wealth building. Books, online courses, and workshops can be great resources.
• Start Small to Overcome Fear : Begin with small investments or financial decisions to build confidence. As you learn and experience success, gradually increase your financial commitments.
• Seek Advice from Financial Experts : Consult with financial advisors, mentors, or knowledgeable individuals in your network to gain insights and guidance.
• Develop a Risk Management Strategy : Understand the risks associated with various financial decisions and develop strategies to manage them.
• Practice Rational Decision Making : Train yourself to make financial decisions based on logic and information rather than emotions or fears.
• Reflect on Financial Mistakes and Learn from Them : Instead of fearing mistakes, view them as learning opportunities. Analyze what went wrong and how you can avoid similar mistakes in the future.
• Regularly Review and Adapt Your Financial Plan : Continuously assess your financial strategy and be willing to make changes as you learn more and as your circumstances evolve.
• Build an Emergency Fund : Having savings set aside can alleviate the fear of financial ruin and provide a safety net for taking calculated risks.
• Embrace Continuous Learning : Stay informed about financial trends and continue to educate yourself. Knowledge is a powerful tool against fear and ignorance.

By following these action items, individuals can confront and overcome the common fears and knowledge gaps that Kiyosaki identifies as major obstacles to financial success.

The Role of Risk in Wealth Creation: Learning to manage and embrace risk as an integral part of wealth building.

Robert Kiyosaki highlights the significance of understanding and managing risk in the journey to wealth creation. He argues that avoiding risk entirely can mean missing out on significant financial opportunities. Instead, savvy investors learn to identify, assess, and manage risks effectively. Kiyosaki points out that successful wealth builders don’t avoid risks but rather learn how to mitigate them and make informed decisions. Embracing and managing risk, rather than fearing it, is a key differentiator between those who build substantial wealth and those who do not.

• Risk as an Integral Part of Investing : Accepting that all investments carry some level of risk and that avoiding risk can mean missing growth opportunities.
• Educated Risk-Taking : Differentiating between taking calculated risks and gambling. Educated risk-taking involves thorough research and understanding.
• Risk Management Strategies : Developing strategies to minimize potential losses while maximizing potential gains.
• Educate Yourself on Risk Management : Learn about different types of risks associated with various investments and strategies to manage them.
• Start with Low-Risk Investments : If new to investing, start with options that carry lower risk to get comfortable with the concept of risk.
• Diversify Your Investment Portfolio : Spread your investments across different asset classes to reduce the risk of major losses.
• Conduct Thorough Research Before Investing : Never invest in something you don’t understand. Take time to research and understand each investment.
• Develop a Financial Cushion : Build an emergency fund or reserves to protect yourself against unforeseen financial downturns.
• Consult with Financial Experts : Seek advice from financial advisors, especially when making significant investment decisions.
• Regularly Review and Adjust Your Investments : Continuously monitor your investments and make adjustments as needed to align with your risk tolerance and financial goals.
• Embrace Failure as a Learning Opportunity : Understand that not all investments will be successful. Learn from failures to make better decisions in the future.
• Stay Informed About Market Trends : Keep up with financial news and market trends as they can impact the risk associated with your investments.
• Set Clear Investment Goals and Boundaries : Define what you aim to achieve with your investments and set clear boundaries for how much risk you are willing to take.

By implementing these action items, individuals can navigate the inherent risks in investing and wealth creation, as emphasized in “Rich Dad Poor Dad,” and use risk management as a tool for financial growth.

The Significance of Financial Independence: Moving beyond job security to create a sustainable financial future.

Robert Kiyosaki stresses the importance of striving for financial independence rather than settling for job security. Financial independence is described as a state where your assets generate enough income to cover your expenses, freeing you from the need to work for a living. Kiyosaki argues that this can be achieved through smart investing and building income-generating assets. He suggests that achieving financial independence requires a shift in focus from earning a salary to generating passive income through investments, businesses, or other ventures.

• Financial Independence vs. Job Security : Understanding the difference between relying on a job for financial security and creating your own sources of income.
• Building Passive Income Streams : Focusing on creating income sources that do not require active work, like rental properties, dividends from stocks, or income from a business.
• Long-Term Financial Planning : Developing a plan that leads to financial independence over time, taking into account factors like inflation, changing personal circumstances, and market variations.
• Assess Your Financial Goals : Clearly define what financial independence means for you, including how much income you need to cover your living expenses without active work.
• Educate Yourself on Income-Generating Investments : Learn about different types of investments that can generate passive income, such as real estate, dividend stocks, or bonds.
• Create a Financial Independence Plan : Develop a detailed plan that outlines how you will build and manage your assets to achieve financial independence. This plan should include timelines, income goals, and strategies for risk management.
• Start Building Passive Income Sources : Begin investing in assets that can generate passive income. This could involve purchasing rental property, investing in the stock market, or starting a side business.
• Regularly Review and Adjust Your Financial Plan : As your financial situation and the economic environment change, continually reassess and adjust your plan to stay on track towards financial independence.
• Minimize Debts and Liabilities : Work towards paying off high-interest debts and avoiding new debts that don’t contribute to building assets.
• Maximize Savings and Investments : Allocate a portion of your income regularly towards savings and investments that align with your financial independence plan.
• Seek Professional Financial Advice : Consider consulting with a financial advisor to get professional guidance tailored to your personal situation and goals.
• Network with Like-Minded Individuals : Connect with people who are also pursuing financial independence for support, advice, and potential partnership opportunities.
• Stay Informed About Economic and Market Trends : Keep up to date with economic news and market trends as they can impact your investment decisions and financial strategy.

By following these action items, individuals can work towards the goal of financial independence, a central theme in “Rich Dad Poor Dad,” shifting away from sole reliance on employment for financial security.

Entrepreneurship and Business Ownership: The advantages of creating and owning a business.

In the “Rich Dad Poor Dad” book, Robert Kiyosaki highlights the value of entrepreneurship and owning a business as a path to financial success. He advocates for using entrepreneurial ventures to create and accumulate wealth, rather than relying solely on a salary from traditional employment. Kiyosaki emphasizes that owning a business can lead to significant financial gains, primarily through the creation of assets that provide passive income. This approach is contrasted with the traditional mindset of working for someone else, where opportunities for wealth accumulation are often more limited.

• Building Assets Through Business : Understanding that a business can be a powerful asset, generating ongoing income and increasing in value over time.
• Leveraging Entrepreneurial Opportunities : Recognizing and seizing opportunities to create profitable business ventures.
• Risk and Reward in Business : Balancing the inherent risks of entrepreneurship with the potential for substantial financial rewards.
• Identify Business Opportunities : Keep an eye out for market gaps or needs that a new business could address. This could involve innovations, improving existing products or services, or entering an underserved market.
• Educate Yourself on Business Management : Gain knowledge in business operations, management, marketing, and finance. This can be through formal education, online courses, or self-study.
• Develop a Business Plan : Create a detailed business plan outlining your business idea, market analysis, financial projections, and growth strategies.
• Start Small and Grow : Consider starting your business on a small scale, especially if resources are limited. This allows you to learn and adapt with less risk.
• Seek Mentorship and Advice : Connect with experienced entrepreneurs and seek their advice and mentorship. Learning from their experiences can provide invaluable insights.
• Build a Strong Network : Develop a network of contacts in the business community. This network can provide support, advice, partnerships, and customer referrals.
• Manage Financial Risk : Understand and manage the financial risks associated with your business. This includes prudent financial management and possibly securing insurance.
• Focus on Creating Value : Ensure that your business focuses on creating real value for customers, as this is the key to long-term success.
• Reinvest in Your Business : Plow back profits into the business to fuel growth and development, especially in the early stages.
• Stay Adaptable and Responsive to Change : Be prepared to adapt your business model as the market or industry changes to ensure continued relevance and profitability.

By following these action items, individuals can embrace the entrepreneurial journey and business ownership, a key concept in “Rich Dad Poor Dad,” as a means to building wealth and achieving financial independence.

Understanding Taxes and Corporations: Utilizing knowledge of tax strategies and corporate structures for wealth preservation.

Robert Kiyosaki delves into the importance of understanding how taxes and the use of corporate structures can impact personal wealth. He explains that the rich often use corporations to protect and enhance their wealth, primarily due to the tax advantages and protection from liability that corporations offer. Kiyosaki stresses that a deep understanding of tax laws and corporate structures can lead to significant financial benefits, including tax savings, asset protection, and increased opportunities for reinvestment.

• Tax Benefits of Corporations : Exploring how corporations can legally reduce tax liabilities through deductions, expenses, and other financial strategies.
• Protection of Personal Assets : Using corporate entities to separate personal assets from business liabilities, providing a layer of protection against lawsuits or debts.
• Strategic Use of Corporate Earnings : Understanding how to reinvest earnings within a corporation for growth, rather than taking them out as taxable personal income.
• Educate Yourself on Tax Laws and Corporate Structures : Gain a basic understanding of how different corporate structures work and their tax implications. This can be done through self-study, courses, or seminars.
• Consult with Tax Professionals and Legal Experts : Seek advice from accountants, tax advisors, and lawyers who specialize in corporate and tax law. They can provide guidance tailored to your specific situation.
• Consider Forming a Corporation : If you have a business or are planning to start one, consider forming a corporation to take advantage of legal and tax benefits.
• Learn About Tax Deductions and Credits : Understand what expenses can be legally deducted through your business to reduce taxable income.
• Keep Personal and Business Finances Separate : Ensure clear separation between personal and business finances to maintain the integrity of the corporate structure and for ease of accounting.
• Regularly Review Tax Strategies : Tax laws can change, so it’s important to review and update your tax strategies regularly with the help of professionals.
• Educate Yourself on International Tax Laws : If your business operates internationally, understand the tax implications and opportunities in different jurisdictions.
• Plan for Long-Term Tax Efficiency : Develop a long-term tax strategy that aligns with your overall financial goals, including retirement planning, estate planning, and wealth transfer.
• Utilize Tax-Advantaged Investment Opportunities : Explore investment options that offer tax advantages, such as retirement accounts or tax-free bonds.
• Stay Informed About Tax Law Changes : Keep up to date with changes in tax legislation that could affect your business and personal finances.

Through these action items, individuals can leverage the knowledge about taxes and corporations, a vital concept from “Rich Dad Poor Dad,” to protect their wealth and maximize their financial growth potential.

Creating Multiple Streams of Income: Diversification as a key to financial stability.

In the “Rich Dad Poor Dad” book, Robert Kiyosaki emphasizes the importance of creating multiple streams of income to ensure financial stability and growth. He argues that relying on a single income source, such as a salary from a job, can be risky and limits potential financial growth. Diversifying income sources can include investments in stocks, real estate, side businesses, or earning passive income through various assets. This approach not only provides financial security in case one stream dries up but also accelerates wealth accumulation.

• Reducing Dependence on a Single Income Source : Understanding the risk of relying solely on a paycheck and the benefits of having multiple income streams.
• Diversification for Financial Stability : Exploring different types of income streams, including passive income, to reduce financial risk.
• Leveraging Skills and Interests : Utilizing personal skills and interests to create additional income sources.
• Assess Your Skills and Interests : Identify what skills, knowledge, or hobbies you have that could be monetized, like consulting, freelancing, or creating digital content.
• Learn About Investment Opportunities : Educate yourself about different types of investments that can generate income, such as stocks, bonds, real estate, or mutual funds.
• Start a Side Business or Hustle : Consider starting a side business that aligns with your interests or skills. This can range from e-commerce to offering professional services.
• Invest in Income-Generating Assets : Look into assets that can generate passive income, such as rental properties, dividend-paying stocks, or peer-to-peer lending.
• Create a Financial Plan for Multiple Income Streams : Develop a plan outlining how you will create and manage these income streams, including timeframes and financial goals.
• Regularly Review and Adjust Your Income Strategies : Monitor the performance of your income sources and be prepared to make changes as necessary.
• Network and Collaborate : Engage with others to find opportunities for collaboration, which can lead to new income streams.
• Set Aside Time for Your Side Projects : Dedicate specific times to focus on developing and managing your additional income sources.
• Reinvest Profits for Growth : Reinvest earnings from your additional income streams to further grow and diversify your income.
• Stay Informed About Market and Economic Trends : Keeping up with economic trends can provide insights into new opportunities for income generation.

By following these action items, individuals can implement Kiyosaki’s advice from “Rich Dad Poor Dad” to create multiple streams of income, enhancing their financial security and working towards greater financial freedom.

The Power of Networking and Mentorship: Leveraging relationships and learning from successful individuals.

Robert Kiyosaki underscores the significance of networking and mentorship in achieving financial success. He emphasizes that building relationships with knowledgeable and experienced individuals can provide invaluable insights and opportunities in the journey to wealth. Networking can open doors to new business ventures, investment opportunities, and wisdom from those who have already achieved financial success. Mentorship, in particular, offers personalized guidance and learning from someone’s direct experience, helping to avoid common pitfalls and accelerate the path to financial independence.

• Learning from Successful Individuals : The benefits of connecting with people who have achieved financial success and learning from their experiences.
• Expanding Opportunities through Networking : How a robust network can lead to new business and investment opportunities, partnerships, and resources.
• Mentorship for Personalized Guidance : The advantage of having a mentor to offer direct advice, guidance, and feedback on your financial strategies and decisions.
• Attend Networking Events and Seminars : Regularly participate in business networking events, financial seminars, and workshops where you can meet potential mentors and like-minded individuals.
• Join Professional and Business Associations : Become a member of relevant professional groups or associations where you can connect with experienced professionals and entrepreneurs.
• Actively Seek a Mentor : Look for a mentor who has achieved the kind of financial success you aspire to. This could be someone in your existing network, a professional within your industry, or even a local business leader.
• Leverage Social Media and Online Platforms : Use platforms like LinkedIn, business forums, and financial blogs to connect with potential mentors and peers in the financial field.
• Engage in Reciprocal Learning : Offer your own skills and knowledge in exchange for learning opportunities. Networking and mentorship are two-way streets.
• Volunteer or Intern : Consider volunteering or interning with a business or individual you admire to gain direct experience and build relationships.
• Regularly Communicate with Your Network : Maintain regular contact with your network through emails, social media, or attending regular meetups.
• Be Open to Different Perspectives : Be willing to listen to and learn from the diverse experiences and viewpoints within your network.
• Apply Learned Lessons to Your Financial Strategies : Actively apply the insights and advice you receive from your network and mentors to your own financial planning and decisions.
• Give Back to Your Network : As you gain experience and success, offer your own guidance and mentorship to others in your network.

By following these action items, individuals can harness the power of networking and mentorship, a vital principle in “Rich Dad Poor Dad,” to gain insights, opportunities, and guidance on their path to financial success.

Continuous Learning and Adaptation: Emphasizing the need for ongoing education and adaptability in the financial world.

In Poor Dad Rich Dad, Robert Kiyosaki stresses the importance of continuous learning and adaptation, especially in the ever-evolving financial world. This principle revolves around the idea that financial education is a lifelong process and not a one-time event. The financial landscape, including markets, tax laws, and investment opportunities, is constantly changing. To stay ahead and make informed decisions, individuals must commit to ongoing education and be adaptable to new information and changing circumstances. This approach allows for better risk management, more informed investment decisions, and the ability to capitalize on new opportunities as they arise.

• Evolving Financial Knowledge : Recognizing that financial strategies and market dynamics are not static and require regular updating of knowledge.
• Adaptability to Market Changes : Being flexible and responsive to economic changes, new technologies, and shifts in investment trends.
• Proactive Learning Approach : Taking a proactive stance in seeking new information and understanding emerging financial concepts and tools.
• Regularly Update Financial Education : Dedicate time each week to read financial news, books, and articles to stay informed about current trends and developments.
• Attend Workshops and Seminars : Participate in financial workshops, webinars, and seminars to learn from experts and stay abreast of new strategies and ideas.
• Engage in Online Learning : Utilize online platforms and courses to deepen your understanding of various financial topics, from basic personal finance to advanced investment strategies.
• Stay Informed About Global Economic Trends : Monitor global economic events as they can have an impact on local markets and investment decisions.
• Experiment with New Investment Tools : Explore and experiment with new financial tools and technologies (like financial apps, online investment platforms) to enhance your financial management skills.
• Join Financial Discussion Groups or Forums : Engage with online communities or local groups where you can discuss financial topics, exchange ideas, and get different perspectives.
• Review and Adjust Financial Plans Regularly : Periodically assess your financial plan and investment portfolio to ensure they align with current economic conditions and personal goals.
• Learn from Financial Mistakes : Analyze any financial setbacks or mistakes, and use these experiences to inform future decisions.
• Seek Feedback from Financial Advisors : Regularly consult with financial professionals to get expert opinions and guidance on your financial strategies.
• Embrace Technology in Finance : Stay up-to-date with technological advancements in the financial sector, such as digital banking, online trading platforms, and blockchain technology.

By actively engaging in these action items, you can embody the principle of continuous learning and adaptation in finance, as emphasized in “Rich Dad Poor Dad,” thus equipping yourself to navigate the dynamic and complex world of personal and investment finance effectively.

Rich Dad Poor Dad PDF

This is an 8 page detailed summary of the book in PDF format.

PDF Summary

25 Lessons from Rich Dad Poor Dad

• Financial Education Over Working for Money : Understand the mechanics of money and investing to make money work for you, instead of solely working for money.
• Know the Difference Between Assets and Liabilities : Assets put money in your pocket, liabilities take money out. Building wealth involves acquiring assets and minimizing liabilities.
• Create and Nurture Your Own Business : Focus on building and growing your own business or income-generating ventures alongside your regular job.
• Leverage Corporations for Protection and Benefit : Utilize the legal and tax advantages offered by corporations to protect and enhance your wealth.
• Innovation in Wealth Creation : Develop the ability to spot and create new opportunities for wealth, rather than relying on traditional methods.
• Value Learning More Than Earning : Emphasize acquiring new skills and knowledge, particularly in sales, marketing, and investing, over a short-term focus on salary.
• Confronting and Overcoming Fear : Overcome the fear of losing money, which often holds people back from taking financial risks and opportunities.
• Teach Financial Literacy Early : Educate children about money management and investing from a young age to cultivate their financial intelligence.
• Accelerating Your Wealth Growth : Understand that financial education can significantly speed up the process of wealth building.
• Risk Management : Learn to evaluate and manage risks effectively, an essential skill for financial success.
• Importance of Sales and Marketing Skills : Develop strong communication and sales skills, crucial for success in any business or investment venture.
• Diversify Income Streams : Avoid dependency on a single income source by creating multiple streams of income.
• Learning from Economic Trends and History : Gain insights from past economic trends to make informed investment decisions.
• Embrace Philanthropy : Share wealth and knowledge, understanding that giving back is a key aspect of wealth.
• Separating Emotions from Financial Decisions : Make logical and informed decisions rather than letting emotions drive your financial choices.
• Embrace Failure as a Learning Tool : Understand that making mistakes and facing losses is part of the journey toward financial literacy and independence.
• Consistently Build and Increase Assets : Continuously seek opportunities to acquire and grow assets that generate passive income.
• Networking for Opportunities : Build and maintain a network of contacts that can provide support, advice, and opportunities.
• Prioritize Financial Learning Over Leisure : Dedicate time to learning about finances and investments instead of excessive leisure activities.
• Understanding Tax Advantages and Protection : Learn how to use tax laws and corporate structures to your advantage in wealth building.
• Develop a Robust Financial Plan : Create a clear and strategic plan for financial growth and security.
• Learn from Successful Mentors : Seek guidance and learn from those who have achieved financial success.
• Transition from Active Earning to Passive Income : Shift focus from active income (from a job) to generating passive income through investments.
• Hard Work in Building a Financial Foundation : Recognize the importance of a strong work ethic in establishing a base for financial growth.
• Continuous Learning and Adaptation : Stay committed to continual learning and adapt to changing financial landscapes and opportunities.

Each of these lessons from “Rich Dad Poor Dad” provides insights into building and managing wealth, emphasizing the importance of a mindset shift from traditional views on money to a more proactive, informed approach.

PDF Workbook

Rich Dad Poor Dad Review

“Rich Dad Poor Dad” is not just a book; it’s a paradigm-shifting guide that challenges conventional wisdom about finance, work, and wealth. Robert Kiyosaki’s narrative, based on lessons from his own life, juxtaposes the financial philosophies of two father figures: his biological father, the ‘Poor Dad,’ and the father of his childhood best friend, the ‘Rich Dad.’ Through this compelling contrast, Kiyosaki delivers profound insights into the world of money and investing.

The book’s core premise is that true financial education is seldom taught in schools. Kiyosaki argues that the traditional path of getting a good education and a secure job is not the only or the best way to achieve financial success. Instead, he puts a strong emphasis on acquiring assets that generate passive income and understanding the difference between assets and liabilities.

One of the book’s greatest strengths is its simplicity in explaining complex financial concepts. It turns the often intimidating world of finance into something approachable and understandable. Kiyosaki’s storytelling is engaging, making the book accessible to readers from all walks of life, regardless of their financial background.

However, it’s important to note that while the book is inspirational, it’s not a step-by-step guide to wealth. Some critics argue that it oversimplifies complex financial strategies and lacks specific advice. The book is more about changing one’s mindset regarding money than about specific financial tactics.

“Rich Dad Poor Dad” also stands out for its emphasis on risk-taking and entrepreneurial spirit. Kiyosaki encourages readers to break out of their comfort zones, to see opportunities where others see obstacles, and to learn from failures. This approach is refreshing and can be incredibly motivating for those feeling stuck in traditional career paths.

In conclusion, “Rich Dad Poor Dad” is a compelling read for anyone looking to rethink their approach to finance and wealth. It’s a call to develop financial intelligence and to view money-making through a broader, more opportunistic lens. While it may not provide detailed financial solutions, it certainly sparks the kind of thinking that could lead to financial independence and success.

Highly recommended for its thought-provoking content and fresh perspective on wealth and financial education.

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Rich Dad Poor Dad: A Candid Review of Robert Kiyosaki's Classic

Discover our insightful review of 'Rich Dad Poor Dad,' where we explore Robert Kiyosaki's path to wealth and financial independence.

As I eagerly open the pages of Robert Kiyosaki 's bestseller , " Rich Dad Poor Dad ," I'm hit with an instant wave of anticipation. Much like my experience with James Clear's "Atomic Habits," it's clear that this isn't just another personal finance book ; it's a journey into shifting paradigms and embracing new ways of thinking. Today, I'll take you through an in-depth review of this influential book, exploring its core lessons and impact.

The power of perspective: The core premise

"Rich Dad Poor Dad" is centered around the idea of contrasting views of money and wealth. Kiyosaki presents his own father, a highly educated middle class, but financially insecure man, as the 'Poor Dad,' and his best friend's father, a business owner with a keen eye for investments and real estate, as the 'Rich Dad.' The portrayal of these two individuals reveals two starkly contrasting attitudes towards wealth, serving as the driving force behind the lessons encapsulated in this book.

Kiyosaki's ability to juxtapose the perspectives of these two pivotal figures in his life paints a vivid picture of how our upbringing and education shape our views on money and influence our financial futures. The main take-home message is not about how much money one earns but how one manages, invests, and grows it — their financial IQ.

Shaking up financial education: A journey into wealth building

A critical focal point of "Rich Dad Poor Dad" is the examination of our traditional education system. Kiyosaki fervently argues that formal education often falls short in preparing us for financial success. Schools teach us to strive for job security in today’s economic rat race and a steady paycheck rather than fostering a mindset of wealth creation, building wealth, and financial independence.

The 'Rich Dad' instills in young Kiyosaki the value of financial intelligence and the merits of entrepreneurship. He learns that financial security isn't about earning a high salary, but building and leveraging assets. Conversely, the 'Poor Dad' represents the middle class traditional, and arguably outdated, pathway to success: excel in school, get a good job, be careful with credit cards, save for retirement, and hope for the best.

This paradigm shift, from seeking employment, like the middle class does, to creating business opportunities, like having your own businesses, is a thread that runs throughout the book. Kiyosaki emphasizes the importance of financial education and the cultivation of business acumen as crucial elements to achieving financial freedom.

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The Spreadsheet Dad

A family and personal finance blog.

Book Review: Rich Dad Poor Dad – Robert Kiyosaki

September 1, 2018 thespreadsheetdad.

Rich Dad Poor Dad was the first personal finance book I read, it also happens to be one of the most popular personal finance books ever written, having sold 32 million copies (at the time of publishing this article).

In the book author Robert Kiyosaki recounts the entertaining stories from his childhood, right through to adulthood and along the way points to the lessons from his two ‘Dads’. The two ‘Dads’ being his Rich Dad, who is actually his friends father and his Poor Dad, who is his real father.

The stories are quite entertaining and fun to read, particularly the stories from his childhood learning from his Rich Dad. From setting up a highly successful comic book library from his parents basement to getting put to work for free in one of his Rich Dads stores.

Whilst Robert provides 6 lessons (listed below) the book is not exactly an instructional style finance book, rather it is more about driving home the importance of mindset in wealth creation.

The rich don’t work for money

The importance of financial literacy

Minding your own business

Taxes and corporations

The rich invent money

The need to work to learn and not to work for money

In the book his friend’s father, the “Rich Dad”, takes him under his wing at a young age and helps him understand business and how to become wealthy. During this education from his “Rich Dad” he becomes well aware of why his real dad is poor despite being well educated and having a good and stable job.

People tend to have polarising views on the book, some love it and some think it is rubbish. Personally I think, while it is certainly not perfect and there are parts that are quite vague around the “examples” there is certainly a lot of value to be had from Rich Dad Poor Dad, especially around having the correct mindset to become wealthy, how to recover from failure and how to maintain wealth.

Our education system is flawed

Robert very rightly points out that our current education model is designed to produce employees and does not encourage entrepreneurship, highlighting the need for financial literacy to become part of the curriculum.

This is a subject that is very close to my heart, having two kids of my own so I could not agree with this and am personally doing everything I can to ensure my kids grow with a good level of financial literacy.

If nothing else from this book I took away this little tidbit that I use with myself and my kids when considering an expenditure that is not currently within reach, and I wish it is something that I knew sometime ago.

My poor dad said, “I  can ‘t  afford it . My rich dad asked, “How  can I afford it ?”

This line alone helps shift the mindset from poor to rich.

(I have just purchased Scott Pape’s latest book  The Barefoot Investor for Families: The only kids’ money guide you’ll ever need so I have to have a review up shortly.)

What is an Asset?

This is perhaps one of the more polarising views that Robert discusses in his book.

An asset is something that puts money in my pocket. A liability is something that takes money out of my pocket.

In general people consider their home an asset as it grows in value, however Robert’s view is that is actually a liability as it take money from your pocket, even if you have paid it off in full it still takes money from you via maintenance cost and utility costs and it does not produce you any income.

Whilst this does not exactly align with general accounting standard, in order to become financially free you must have income generating assets. There is no use being equity rich and cash poor.

I tend to agree with Robert, this is the view that people should be taking when considering their investments. What good is an investment property that is losing you money? How can it be an asset if it is not putting money in your pocket each month?

There are points in the book where the Robert does seem to downplay the risk in some of his investment suggestions, which has lead to some criticism. The types of deals that he talks about are also not easily accessible to most people and in some cases may not even be relevant in the current economic climate.

In his defence he does also say that you should not invest in something that you do not fully understand.

In summary, I think this book is an excellent starting point for someone beginning the journey to financial freedom as it does help you to shift your mindset when thinking about money. I have also read  Rich Dad’s Cashflow Quadrant which builds on many of the things in this book and I also would recommend.

Thanks for reading.

If you have an read Rich Dad Poor Dad I would love to hear your opinion in the comments below.

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Rich Dad, Poor Dad Summary – Robert Kiyosaki Book

Rich Dad Poor Dad is Robert Kiyosaki’s best-selling book about the difference in mindset between the poor, middle class, and rich. In this Rich Dad Poor Dad book summary, we’ll break down some of the best lessons Kiyosaki shares to help you become more financially literate. So, let’s dive in. 

Post Contents

20 Years… 20/20 Hindsight

Introduction, chapter one: lesson 1: the rich don’t work for money, chapter two: lesson 2: why teach financial literacy, chapter three: lesson 3: mind your own business, chapter four: lesson 4: the history of taxes and the power of corporations, chapter five: lesson 5: the rich invent money, chapter six: lesson 6: work to learn – don’t work for money, chapter seven: overcoming obstacles, chapter eight: getting started, chapter nine: still want more here are some to do’s, final thoughts.

Rich Dad’s Lesson 1: “The rich don’t work for money.”

In today’s world, there’s never been a more significant divide between the rich and all other income classes. Some economists in California even noticed that about 95% of income gains between 2009-2012 went to the wealthiest people in the world– the one percent. Thus, showing that the biggest increases in income go to entrepreneurs and investors– not employees.

Rich Dad Lesson: “Savers are losers.”

The emphasis on saving is only found in the poor and middle class. However, the reason why savers are losers is that since 2000 there have been three massive stock market crashes. 

• Dotcom Crash: 2000. 
• Real Estate Crash: 2007
• Banking Crash: 2008

The first three crashes of the 21st century pale in comparison to the great crash of 1929. When you look at the data visually, you can see how big of an impact the crashes were.

Notably, after each stock market crash, the American government and the Federal Reserve Bank started “printing money.”

Today’s interest rates are relatively close to zero, which is what makes savers losers. And the biggest savers are the poor and middle class. 

Rich Dad Lesson: “Your house is not an asset.”

When Robert Kiyosaki first published Rich Dad, Poor Dad in 1997, every publisher who had rejected his book had criticized the lesson regarding a person’s house not being an asset. Historically, people believed that your home was the biggest investment you can make. 

However, it wasn’t until 2007 when “subprime borrowers began to default on their subprime mortgages,” that people realized that a house wasn’t an asset.

The real estate crash was caused by the rich, not the poor. “The rich created financially-engineered products known as derivatives.” Even Warren Buffett hated these, calling them “weapons of mass financial destruction.” The derivatives were the cause of the housing market collapse. Yet, somehow, the poor were blamed even though there were approximately $700 trillion in financial derivatives. Believe it or not, but that number has since exploded to $1.2 quadrillion in financial derivatives. 

Rich Dad Lesson: “Why the rich pay less in taxes.”

Poor people often get angry when they learn rich people pay less in taxes. Instead, they should focus on learning from the rich as they pay fewer taxes legally.

The poor and middle class will always pay more taxes than the rich. This statement is true because it’ll always be the person who works for money who gets taxed the most.

When presidents promise to raise taxes on the rich, they typically mean the middle class. Not the real rich. 

Robert Kiyosaki had two fathers: a rich one and a poor one. One was highly educated with a Ph.D. and so intelligent he completed his undergraduate degree in only two years. The other father didn’t even finish the eighth grade. While both men worked hard, were successful, and earned a lot of money, there was always one who struggled with money. And the other dad, well, he became one of the richest people in Hawaii. 

By having two dads, with entirely different mindsets, Kiyosaki found himself comparing the two dads a lot. It was hard to figure out which dad he should listen to. Neither had found success yet. And both were experiencing financial struggles as they were still early in their careers.

Schools don’t provide financial education. Thus, causing the poor and middle class to be in debt. If millions of people need financial or medical assistance, Medicare and Social Security may run out. 

Transitioning from the mindset of “I can’t afford it” to “How can I afford it?” forces you to think instead of letting yourself off the hook. 

Poor Dad: The rich should pay more in taxes

Rich Dad: Taxes reward those who produce

Poor Dad: Study hard so you can find a good company to work for

Rich Dad: Study hard so you can find a good company to buy

Poor Dad: I’m not rich because I have children

Rich Dad: I must become rich because I have children

Poor Dad: Don’t talk about money over dinner

Rich Dad: Talk about money and business over dinner

Poor Dad: “Don’t take risks.”

Rich Dad: “Learn to manage risk.”

Poor Dad: A house is the biggest asset you own

Rich Dad: A house is a liability

Poor Dad: Pay your bills first

Rich Dad: Pay your bills last

Poor Dad: struggles to save a few dollars

Rich Dad: creates investments

Poor Dad: teaches how to write a strong resume

Rich Dad: teaches how to write a strong business and financial plan

Poor Dad: “I’ll never be rich.”

Rich Dad: “I’m a rich man, and rich people don’t do this.”

“The poor and middle-class work for money. The rich have money work for them.”

Growing up, Robert Kiyosaki went to the same school as the rich kids, simply because he lived on a different side of the street. Being poor, in a school filled with affluent students, made him seek an answer to the question, “how do I make money ?”

His best friend Mike was also poor, and so a friendship was struck between the two. The two spent an entire morning one Saturday brainstorming all the ways they could make money. Their first project wasn’t a success, nor was it legal. They decided to cast nickels out of lead to make money– literally. With a quick explanation of the laws of counterfeiting from Robert Kiyosaki’s poor dad, the pair went back to the drawing board. 

Robert Kiyosaki’s poor dad suggested that the two learn how to make money from Mike’s dad (Robert Kiyosaki’s rich dad). Poor dad had heard from his banker how good the rich dad is at making money. Mike arranged a meeting time, and the two began their lessons.

Robert Kiyosaki arrived at 8 o’clock sharp for his meeting with Mike’s dad. When the meeting began, the rich dad told the two that he’d be happy to teach them but won’t be doing it in a classroom style. He proposed that the two boys work for him so that he can teach them faster. The two weren’t allowed to ask questions about the deal. And so the first lesson was learned: opportunities are fleeting, so you need to jump on them when they arrive. He offered to pay Robert and Mike 10 cents an hour, for three hours, every Saturday. 

After a couple of weeks doing excruciatingly boring work, Robert told Mike that he wanted to quit . This response is what Mike’s dad was hoping for.

Before his meeting with his rich dad, Robert Kiyosaki’s poor dad told him to demand what he deserves at least 25 cents an hour and to quit his job immediately if he didn’t get a raise. Robert went to meet with his rich dad but was forced to wait 60 minutes longer than expected, which infuriated him. Robert felt that his rich dad hadn’t kept his end of the bargain of teaching him and that he was just trying to exploit him by making him work for him.

His rich dad noticed that Robert had sounded like his employees after only one month. Rich dad insisted that he was teaching Robert, but in a way that life teaches, not in the way that school does. The most effective way to learn is by doing, though most people consume education from books, which is the least effective way.

The main lesson he taught in the office that day was that Robert could either end up like his employees who blame others for his problems, or he could take another path and become a wealthy man.

Rich dad had suggested that the two boys find a new way to make money outside of working for someone else. 

Lesson 1: “The poor and middle-class work for money. The rich have money work for them.” 

Rich dad also shared how happy he was that Robert Kiyosaki got angry. He said, “anger is a big part of the formula, for passion is anger and love combined.” Fear is what controls employees that causes them to exploit themselves.

Rich dad continued, “…it’s fear that keeps most people working at a job: the fear of not paying their bills, the fear of being fired, the fear of not having enough money, and the fear of starting over.”

Employees often feel disappointed looking at their paychecks– especially after tax and deductions. This was nine-year-old Robert’s first introduction to taxes. It’s also how he learned that the rich don’t let the government do that to them, even though they earn more.

In a new deal, rich dad negotiated that Robert continues working for him, but for free. For the next three weeks, Robert and Mike worked for their rich dad for free. Then, on the third Saturday, he took them out to a park for some ice cream. He decided to introduce him to the trap of the rat race. He did this by offering to pay them twenty-five cents an hour. They said no. Rich dad then offered a dollar an hour. They said no. Then, two dollars an hour. They said no. Then, five dollars an hour. And they once again said no. The boys knew that they couldn’t be bought. They were committed to becoming wealthy. 

Rich dad later pointed out that poor people often say they’re not interested in money. Robert Kiyosaki thought back to the times his dad would say, “I’m not interested in money. I work because I love my job.” This is how poor people often cover themselves up.

It’s essential to not give in to your emotions, such as fear, so that you can prevent any quick reactions and think objectively about a situation. The reality is a job is merely a short-term solution to a long-term problem. Rich dad’s focus is on teaching the boys how to have a choice of thoughts instead of a knee-jerk reaction to things. 

One of the most empowering lessons rich dad taught in this section of Rich Dad Poor Dad was to “keep using your brain, work for free, soon your mind will show you ways of making money far beyond what I could ever pay you. You will see things that other people never see. Most people never see these opportunities because they’re looking for money and security, so that’s all they get.”

This lesson inspired the two boys to find a new way to make money. On one Saturday, they noticed Mrs. Martin cutting off the cover of the comic books and throwing them into a cardboard box. Since they weren’t allowed to resell the comic books, they decided to create a library for a fee where other kids could come over to read as many comic books as they like between 2:30 p.m. and 4:30 p.m. every day after school for only 10 cents. This deal was a bargain for the other kids who might’ve spent 10 cents buying a comic book. Each week, they averaged around $9.50, while paying Mike’s sister one dollar a week to manage the library. After three months, a fight broke out in the library, and Mike’s dad advised them to shut down the business. But they did manage to learn how to make money work for them instead of working for money. 

“It’s not how much money you make. It’s how much money you keep.”

Robert Kiyosaki retired at the age of 47. He still works, but for him and his wife, Kim, working is an option as their wealth will continue to grow automatically.

In this section of Rich Dad, Poor Dad, Robert Kiyosaki shares a simple story. In 1923, the greatest leaders and richest businessmen joined together for a meeting in Chicago. Twenty-five years later, nine of them had their life end in the following ways:

• Four died broke
• One went insane
• Two were released from prison
• Two committed suicide

This unfortunate turn was likely due to their lives being drastically affected by the 1929 stock market crash and the Great Depression. 

The biggest financial lesson to learn is that it’s all about how much money you keep, not how much you make. And without financial literacy, you’ll lose your money soon.

Growing up, poor dad recommended that Robert read books while rich dad recommended that Robert master financial literacy. Robert shares, “If you are going to build the Empire State Building, the first thing you need to do is dig a deep hole and pour a strong foundation. If you are going to build a home in the suburbs, all you need to do is pour a six-inch slab of concrete. Most people, in their drive to get rich, are trying to build an Empire State Building on a six-inch slab.”

It’s vital to learn the subject of accounting if your long-term goal is to be rich – no matter how boring you think the topic is.

Rule #1: You must know the difference between an asset and a liability– and buy assets.

“Rich people acquire assets. The poor and middle class acquire liabilities they think are assets,” rich dad says.

The biggest challenge poor people have is knowing the difference between an asset and a liability. Knowing the difference between the two can help you become rich. 

So, what’s the difference?

An asset puts money into your pocket. A liability takes money out of your pocket. 

Assets add to your income. Liabilities add to your expenses. And the job of a poor person pays you an income that then covers your expenses. The job of a middle-class person pays you an income then pays down liabilities then pays expenses. However, for a rich person, their assets pay them an income. For example, their assets may give them rental income, dividends, interest, or royalties.

Here are a few examples of liabilities that the middle class own:

• Credit card debt
• School loans

Here are a few examples of assets that rich people own:

• Real estate
• Intellectual property

Many people who are poor or in the middle class often say, “I’m in debt, so I need to make more money.” However, getting money isn’t a problem. It’s the lack of financial literacy that’s the problem. So if they simply had more money, the problem might become worse. That’s why when people win the lottery or get a pay raise, they usually end up back in the same financial situation as they did before. If a person spends all they have, the pattern will continue every time they make money.

Professional success isn’t directly tied to academic success anymore. Most students leave their schools with limited financial literacy. Later in life, they find themselves struggling financially. What they need to know more than how to make money is how to manage their money. This skill is called financial aptitude. Most people learned how to work hard instead of how to make money work hard for them.

Taxes end up costing the poor and middle class in the long run. People often buy bigger homes to grow a family, and property tax rises. People’s salaries increase over time, and so social security tax also sees a rise. And before long, their liabilities column is filled up with a mortgage and credit-card debt. Thus, trapping them in the rat race. 

The secret to knowing how to make money is simply about creating assets instead of liabilities. 

Golden Rule: “He who has the gold makes the rules.”

“Most financial problems are caused by trying to keep up with the Joneses.” You might choose to buy a bigger house, work harder, or get a promotion or pay raise.

As teenagers, Mike and Robert would work with their rich dad. They studied how he held meetings with his bankers, attorneys, accountants, investors, so forth. Even though his rich dad had left school at 13, he was now directing some very educated people.

Rich dad regularly told the two teens, “An intelligent person hires people who are more intelligent than he is.”

As a teenager, Robert realized he had more financial literacy than his poor dad as he was able to keep books and spent a lot of time listening to bankers, tax accountants, real estate brokers, and others like them.

In this section of Rich Dad Poor Dad, Robert Kiyosaki shares that many people view their home as an asset. However, in many cases, the value of a home doesn’t always go up. Sometimes people buy million-dollar houses that would sell for far less. Retirees such as Kim’s parents had a strain on their budget when their property taxes increased to $1,000 a month.

When Robert plans on buying a bigger house, he “first buys assets that will generate the cash flow to pay for the house.” He shares that as you continue to grow your asset column, over time, you’ll also see the growth of your income. And that’s why the rich keep getting richer– however, the reason why the middle-class struggles are because taxes increase as their salaries increase.

Employees work for three key groups:

• Company: Making the owners and shareholders rich
• Government: Possibly 100% of the work you do from January until May goes towards taxes
• Bank: Your biggest expenses are your mortgage and credit card debt

“Wealth is a person’s ability to survive so many number of days forward– or, if I stopped working today, how long could I survive?”

For example, if a person has $1,000 a month in cash flow from their asset column and they have monthly expenses of $2,000 a month, they will only be wealthy once they have $2,000 a month of cash flow to their asset column.

The average American only has less than $400 in savings, with an astounding 34% with none at all.

So to sum up:

• “The rich buy assets.
• The poor only have expenses.
• The middle class buy liabilities they think are assets.”

“The rich focus on their asset columns while everyone else focuses on their income statements.”

While most people assume that Ray Kroc, the founder of McDonald’s, is in the hamburger business, Kroc once told an MBA class that he’s actually in the real estate business. That’s why he carefully chose every location for his franchises. Today, McDonald’s owns more real estate than any other organization in the world – even the Catholic church.

When someone asks the average person, “What is your business?” they typically respond with their profession. However, they are not owners of the company they work for. They still need their own business. Otherwise, they’ll spend their life working for everyone but themselves. That’s the importance of minding your own business.

Financial hardship comes from spending your life putting money into someone else’s pocket instead of your own. But by working for others, they’ll be dependent on pay raises, getting second jobs, or working overtime. 

Without a financial foundation, you’ll be stuck to your job and its security for the rest of your life.

However, it’s important to note that entrepreneurship can be a tricky path. In one instance, Robert Kiyosaki tried to get a loan. The loan committee saw that he owned a lot of real estate properties. However, they struggled to understand why he didn’t have a salary or a 9 to 5 job. Even though, at the time, he did own many assets such as Armani suits, art, golf clubs, and of course, property. 

It’s also good to note that as you sell your assets, the government taxes you on the gains. Robert recommends to “keep your expenses low, reduce liabilities, and diligently build a base of solid assets.” If you have children, advise them to build assets before they move out or fall into the trap of the rat race.

Here are a few more assets that Robert recommends that you or your children acquire:

• “Businesses that do not require my presence. I own them, but they are not managed or run by other people. If I have to work there, it’s not a business. It becomes my job.
• Income-generating real estate
• Notes (IOUs)
• Royalties from intellectual property such as music, scripts, and patents
• Anything else that has value, produces income, or appreciates, and has a ready market”

Rich dad used to say, “If you don’t love it, you won’t take care of it.”

You can keep your day job, but you should also start buying assets like those listed above.

Since 90% of companies fail, Robert Kiyosaki’s goal is to sell the entire stock of a company within a year of going public.

To become rich, you’ll need to buy luxuries last. People who buy luxuries first are often in much debt. The aim is to build income-generating assets that can buy luxuries.

“My rich dad just played the game smart, and he did it through corporations– the biggest secret of the rich.”

The poor often say, “‘Why don’t the rich pay for it?’ or ‘The rich should pay more in taxes and give it to the poor.’” However, the real rich never pay taxes. The people who pay taxes are the educated, middle class.

While poor dad knew the history of education, rich dad knew the history of taxes. Taxes originated in England and America temporarily to pay for wars. It wasn’t until 1874 when England permanently added income taxes as a requirement of its citizens. It started in 1913 for Americans. An interesting tidbit about taxes is that it was initially only for the rich to pay. That’s what governments told the poor and middle class to help get them on board with the idea. That was how it got voted into law in the first place.

Poor dad: paid to spend money and hire people; government gains respect the bigger it gets

Rich dad: gains respect of investor by spending and hiring less

Poor dad: the rich are ‘greedy crooks’

Rich dad: the government are ‘lazy thieves’

The rich don’t get taxed as tax laws help them to create jobs and provide housing. Thus, the government is dependent on the middle class for their tax revenue.

The rich put their money into a corporation. Their asset puts income into their corporation, and then corporate income can be used as income for their personal income statement. And the expenses from their personal income statement can go into the expenses for the corporation. Even though the masses continuously try to find ways to tax the rich, the rich consistently outsmart them.

Something to remember about the government is that if they don’t spend their allotted funds, they’ll risk losing money when the next budget is announced. They aren’t rewarded for being efficient spenders. Yet, entrepreneurs are rewarded for financial efficiency. The mindsets between the two are polar opposite.

The rich look for legal loopholes to avoid paying taxes. That’s why they often hire the smartest accountants and attorneys.

In real estate, Robert Kiyosaki uses one of these legal loopholes as well. There’s a section called 1031 in the Internal Revenue Code that allows a seller to delay the payment of taxes in w when they sell real estate provided that they buy a more expensive piece of real estate. Thus, by consistently trading up, he delays getting taxed until the time comes to liquidate. This strategy also allows him to continue building his asset column.

Knowing the law can help save you money (while also making sure you follow it).

Poor dad: climb the corporate ladder

Rich dad: own the corporate ladder

When Robert was in his mid-twenties working for Xerox, he realized how disappointing it was to look at his paycheck. His bosses would talk to him about promotions and pay raises. However, that only made him see his deductions rise too. He could see himself becoming his poor dad. This realization is what made him realize he needed to follow his rich dad’s path. So Robert turned to minding his business by building out his asset column so he could invest in Hawaii’s real estate market. This newfound motivation made him work harder at selling Xerox machines at work. He knew he was building something bigger than himself. 

After three years of hard work, his real estate business was making more than he was at Xerox. His company bought him his first Porsche. His coworkers had no idea that he wasn’t spending his commissions on the Porsche but assets. 

Financial IQ is made up of four key areas:

• Accounting: ability to read numbers
• Investing: the concept of money making money
• Understanding markets: knowing supply and demand
• Tax advantages: corporations can pay expenses before taxes, which employees can’t do. A corporation can spend everything it can and be taxed only on everything left over. You can expense car payments, insurance, repairs, health club memberships, and most restaurant meals.
• Protection from lawsuits: The rich use corporations to protect their assets from creditors, whereas the poor and middle class try to own everything themselves.

Business Owners with Corporations

Employees Who Work for Corporations

“Often in the real world, it’s not the smart who get ahead, but the bold.”

When companies downsize, employees often blame the owners for being unfair. In a news story he saw, Robert Kiyosaki shares, “A terminated manager of about 45 years of age had his wife and two babies at the plant and was begging the guards to let him talk to the owners to ask if they would reconsider his termination. He had just bought a house and was afraid of losing it.” Inside of us is both someone brave and someone who will get on their knees and beg.

However, when we’re so afraid that we start doubting ourselves, we fail to push forward. Instead, it’s the bold who get ahead. 

Aim to convert your fear into power.

The result of gaining financial literacy and taking risks is “having more options.”

In the future, we’ll be seeing a rise in successful companies being created but also a surge in companies failing– downsizing and laying off employees. It’s better to be making millions from the assets you build than aiming to get a raise. This period is a great era to be building assets.

Wealth over the years

• 300 years ago: the person who owns land
• Later: the person who owns factories and production
• Today: the person with the most timely information

“The players who get out of the Rat Race the quickest are the people who understand numbers and have creative financial minds.”

It is possible to have the money yet still struggle to move ahead financially.

Some people have a great opportunity present itself only to fail to have enough money to take advantage of it. Others have a fantastic opportunity present itself only to lack the ability to recognize that it’s a great opportunity (and they may even have the money to take advantage).

The strategy of the average person is: “Work hard, save, and borrow.” But instead of working hard, they should aim to improve their financial intelligence so that they can make more money. The people who get rich the fastest are those who realize that money isn’t real.

“The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth.”

Today, savers are considered losers. The reason for this is because interest rates have never been lower. Plus, banks now charge you for holding your money.

During the stock market crash, Robert Kiyosaki was short of cash as he had his money in the stock market and apartment houses. However, he knew this was the time to buy. He and his wife had about a million dollars to invest in some amazing deals. He decided to shop for houses at the bankruptcy attorney’s office. He asked a friend for a $2,000 loan with a return of $200, so he could buy a $20,000 home that was worth about $75,000. He then ran an ad promoting the house for $60,000. It sold within minutes. He asked for a $2,500 processing fee. Thus, giving his friend his money back without using any of his own money. Thus, earning him a profit of $40,000 with a promissory note. The whole process took him five hours.

At the time Rich Dad Poor Dad was published, there had been three stock market crashes in 30 years.

• 1989-1990: real estate
• 2001-2002: dot-com bubble burst
• 2008-2009: housing bubble burst

All of these stock market crashes were investment opportunities.

Which one sounds harder?

• “Work hard. Pay 50% in taxes. Save what is left. Your savings earn 5%, which is also taxed. OR
• Take the time to develop your financial intelligence. Harness the power of your brain and asset column.”

Most of Robert Kiyosaki’s financial growth comes from real estate and small-cap stocks.

“The problem with ‘secure’ investments is that they are often sanitized, that is, made so safe that the gains are less.”

In one example, Robert Kiyosaki paid $45,000 on the house worth $65,000 that the owner was struggling to sell. The first year he rented it out to a local professor. And after expenses, he nets $40 a month. However, a year later, when the market picked back up, he sold it for $95,000. Since he had used the money to buy a bigger property, a 12-unit apartment, he was able to defer the payment of capital gains. He spent $300,000 on the apartment. And only two short years later sold it for $495,000 and bought a 30-unit apartment building with a cash flow of $5,000 a month. A few years later, he sold it for $1.2 million.

The best deals aren’t usually offered to newcomers. They’re often reserved for the rich. But the more sophisticated you get at the game, the more opportunities you’ll be presented with. Most of Robert Kiyosaki’s millions started with as little as $5,000 or $10,000 investments.

In the past, Robert has bought 100,000 shares at 25 cents a share before a company goes public. Then, the company goes public, and whether it’s $2 each or if it flies to $20, you can sometimes make a million dollars in less than a year.

“It’s not gambling if you know what you’re doing. It’s gambling if you’re just throwing money into a deal and praying.”

Robert Kiyosaki shares, “Most people never win because they’re more afraid of losing. That is why I found school so silly. In school, we learn that mistakes are bad, and we are punished for making them. Yet if you look at the way humans are designed to learn, we learn by making mistakes. We learn to walk by falling down. If we never fell down, we would never walk.”

People’s fear of losing causes them to not be rich. “People who avoid failure also avoid success.”

Three skills of an investor:

• Find an opportunity that everyone else missed: see with your mind instead of your eyes
• Raise money: know how to raise capital outside of a bank
• Organize smart people: hire people more intelligent than you

“Job security meant everything to my educated dad. Learning meant everything to my rich dad.”

During an interview with a journalist, Robert Kiyosaki learned that the journalist strived to become a best-selling author. He realized she was a great writer and that she should pursue that. She told him that she had tried, but no one was interested. He accidentally offended her when he told her to take a sales course so she could promote herself. She became defensive. 

She replied, “I have a master’s degree in English literature. Why would I go to school to learn to be a salesperson? I am a professional. I went to school to be trained in a profession, so I would not have to be a salesperson. I hate salespeople. All they want is money.” She packed her things. Robert Kiyosaki gently pointed out that he was the best-selling author, not the best-writing author. This statement only infuriated her more, and the interview ended.

The world has many successful and talented people: doctors, lawyers, dentists. And still, they struggle financially. But as a wise business consultant once said, “They are one skill away from great wealth.” If you took your skillset and paired it with financial intelligence, accounting, investing, marketing, or law, you could achieve great wealth.

If that journalist had instead picked up a job at an ad agency to learn how to sell, she could go on to create great wealth with her writing.

Rich dad says, “You want to know a little bit about a lot.” In school and at work, you’re expected to specialize. Those who earn promotions tend to be specialists. However, Robert Kiyosaki’s rich dad always recommended the opposite. That’s why, throughout the years, Robert would work in different areas of his rich dad’s company. He was expected to attend meetings with lawyers, bankers, accountants. It was essential to the rich dad for Robert to know every aspect of creating an empire.

When Robert Kiyosaki had quit his high-paying job, his poor dad had a heart to heart talk with him, failing to understand his mindset for quitting.

Poor dad: values job security

Rich dad: values learning

Poor dad: assumed Robert went to school to learn how to be a ship’s officer

Rich dad: knew Robert went there to study international trade

The reason Robert had quit his job was so that he could learn how to lead people as his rich dad said, “If you’re not a good leader, you’ll get shot in the back, just like they do in business.”

“Job is an acronym for ‘Just Over Broke.’”

Robert Kiyosaki recommends taking on jobs where you can learn new skills instead of jobs that pay the most.

The biggest fear for aging Americans is running out of money before they die. When you add up health costs and long-term nursing home care, it’s quite likely that the average American will run out of money during their retirement.

“Are workers looking into the future or just until their next paycheck, never questioning where they are headed?”

The best advice Robert Kiyosaki has for those looking to earn more money is to pick up a second job that’ll teach them a second skill. 

It’s normal to feel a bit of resistance to that idea; you might not be excited to do something you aren’t passionate about. But remember, you go to the gym not because you want to but because you want to be healthy and live a long life. 

Robert shares the story of an artist in Hawaii who inherited $35,000. He used the money to run ads in an expensive magazine that targeted the rich. However, not a single person reached out. He lost his entire savings. The artist is now trying to sue the magazine for misrepresentation. However, the reality is that he didn’t have any advertising experience. When Robert asked this artist if he’d be interested in taking a course, he said, “I don’t have the time, and I don’t want to waste my money.” Most people focus on improving their product rather than learning how to sell it.

Management Skills Needed for Success:

• Management of cash flow
• Management of systems
• Management of people

“The most important specialized skills are sales and marketing.”

Robert Kiyosaki’s friend Blair Singer shares, “Sales = Income. Your ability to sell– to communicate and position your strengths– directly impacts your success.”

Most people fear rejection, which is why they’re often intimidated by sales and marketing.

Law of Money: “Give, and you shall receive.”

Robert shares, “In conclusion, I became both dads. One part of me is a hard-core capitalist who loves the game of making money. The other part is a socially responsible teacher who is deeply concerned with this ever-widening gap between the haves and the have-nots. I personally hold the archaic education system primarily responsible for this growing gap.”

“The primary difference between a rich person and a poor person is how they manage fear.”

There are five core reasons why even the financially literate don’t become financially independent:

Not even the rich, like losing money. No one does really. Rich dad says, “Some people are terrified of snakes. Some people are terrified of losing money. Both are phobias.” That’s why it was so crucial for Robert’s rich dad to teach his two sons how to take risks at a young age. The younger you are, the easier it is to become rich. 

Approach risk like a Texan. Texans both win big and lose big. Their attitude is what’s game-changing. They feel a sense of pride when they win, but they still brag even if they lose. They lack a fear of loss. Their loss inspires them.

Before you win, you lose. Like all those times you fell off a bicycle before you learned how to ride it. Before people became rich, they lost money. Most people are more afraid of the pain of losing money than the happiness of becoming rich.

“Rich dad knew that failure would only make him stronger and smarter.”

Losers are defeated by loss. Winners are inspired by loss. You can still hate losing without being afraid of it.

Most people invest in low-yield mutual funds because it’s the safe thing to do. But that’s not the portfolio of a winner.

To be successful, you’ll need to be focused, instead of balanced.

FOCUS: Follow One Course Until Successful

Don’t let doubt cause you not to act. Avoid remarks from friends and family, such as, “‘What makes you think you can do that?’ ‘If it’s such a good idea, how come someone else hasn’t done it?’ ‘That will never work. You don’t know what you’re talking about.’”

Investors know that when it’s a period of doom and gloom, that’s the best time to make money.

Robert’s friend Richard recently asked him for advice on buying property. The two of them identified a two-bedroom townhouse for only $42,000. Others at the time were selling for $65,000. He bought it. But after talking to a neighbor, he backed out, thinking he got a bad deal. A short few years later, the property was worth $95,000. And Richard’s small investment of $5,000 could’ve helped him get out of the Rat Race. Doubt can be a deal killer.

When it comes to financial education, you need to know the difference between good debt and bad debt. Analyze instead of criticizing. 

Most people say they’re too busy to focus on their wealth and health, but really they’re avoiding it.

“Rich dad believed the words ‘I can’t afford it’ shut down your brain. ‘How can I afford it?’ opens up possibilities, excitement, and dreams.” Instead of buying his kids everything they wanted, rich dad asked them to think about how they can afford it. Rich dad never gave Robert or Mike anything. The boys had to pay for college on their own.

The financial struggle often comes from bad habits. You need to pay yourself first. Otherwise, you likely won’t be left with anything after paying your bills. That’s because if you pay yourself first and fail to have enough money left over for bills, you’ll need to find new ways to earn more money. It becomes a motivator – especially when debt collectors start calling.

“What I know makes me money. What I don’t know loses me money.”

A gold miner in Peru once told Robert Kiyosaki, “There is gold everywhere. Most people are not trained to see it.”

Robert said this was also true for him in real estate. He said he could find about four to five excellent properties a day, whereas others may look and find none.

10 Steps to Develop Your God-given Powers

• A young woman who dreamed of going to the Olympics would swim every morning for three hours before going to school. She also spent her weekends studying to maintain high grades. When asked why, she responded, “I do it for myself and the people I love. It’s love that gets me over the hurdles and sacrifices.”
• With every dollar we receive, we choose whether we become: rich, poor, or the middle class. However, you need to train your children to know how to manage your assets. Otherwise, they’ll be lost in the next generation.
•  It’s important to learn how to invest before investing.
• You don’t have to choose friends based on their financial statements.
• Choose friends who talk about money and are interested in the subject.
• People with money often report that their friends without money never ask them how they did it. But they do ask for: a loan or a job.
• Study what you want to do. For example, if you want to be a cook, study cooking.
• If you want to make money, don’t work for it.
• Most people learn but fail the most crucial step: action.
• It’s not what you know but how fast you learn.
• Without self-discipline, you wouldn’t know how to manage a million dollars if you were to receive it.
• You’ll only get pushed around in life if you lack self-discipline and internal control.
• Personal time
• People who pay themselves first end up using the money to acquire assets that pay for their expenses, and then they’re leftover is income. People who pay themselves last, lose all their money with expenses.
• Even if your cash flow is far less than your bills, you need to pay yourself first.
• Robert Kiyosaki has more liabilities than most of the population, but he uses tenants to pay for his debts.
• “Don’t get into large debt positions that you have to pay for. Keep your expenses low.”
• Don’t dip into your savings when pressure builds. Use the pressure to find new ways of making more money.
• Savings need to be used to make more money instead of paying bills.
• Pay professionals well and have expensive attorneys, accountants, real estate brokers, and stockbrokers. Their services should be making you money. Those professionals who make more will also make you more money.
• Poor people will often tip restaurant servers 15-20 percent even with lousy service but get mad when they need to pay a broker three to seven percent.
• Have a board of directors; it’s essential to have people working for you who are smarter than you.
• “The sophisticated investor’s first question is: ‘How fast do I get my money back?’ They also want to know what they get for free, also called a ‘piece of the action.’ That is why the ROI, or return on investment, is so important.’
• When Robert Kiyosaki wanted to buy a small condominium in foreclosure, he submitted a bid $10,000 less than asking. But since he presented a cashier’s check with the full amount, the bank knew it was a serious deal and accepted it. After three years of renting out the property, Robert Kiyosaki officially owns the asset, which continues to make him money.
• When you acquire an investment, you should aim to get something free with it– for example, a condominium, a piece of land, stock shares, etc.
• McDonald’s founder, Ray Kroc, wanted the land underneath every McDonald’s location for free with every franchise he opened
• A father wanted to teach his child how to make money. His son had been asking for a car but didn’t want him spending his college money on it. His father gave him $3,000 that the son could use to buy a vehicle indirectly. So he couldn’t use the cash to buy a car. His son started learning how to invest in stocks. He read every book, he read publications, and even though he lost $2,000 in the stock market, his interest had been piqued.
• Don’t buy luxuries with liabilities like credit, buy them from your asset column
• 80 would have spent it all or gone further in debt
• 16 would’ve increased the amount by 5-10 percent
• Four would have either doubled it or grew it to the millions
• Robert Kiyosaki’s heroes are Warren Buffett, Peter Lynch, George Soros, etc. 
• When Robert Kiyosaki analyzes a deal, he tries to look at it the same way Warren Buffett would. This strategy helps him tap into raw genius.
• Robert’s rich dad taught him to be charitable. His poor dad taught him to give away his time and knowledge, but not money.
• Rich dad says, “If you want something, you first need to give.”
• If you want money, give money.

Stop doing what you’re doing.

• If it’s not working, try something new.

Look for new ideas.

• Read how-to books with formulas on topics you want to learn more about.
• Read: The 16 Percent Solution by Joel Moskowitz

Find someone who has done what you want to do.

• Find the expert who has done something you want to do and pick their brain so you can learn from them.

Take classes, read, and attend seminars.

• Many classes are free or low cost, search the internet for them so you can absorb more knowledge.

Make lots of offers.

• Robert submits offers on multiple real estate properties that he wants. He leaves the deal up to the real estate agent, who is the expert, whereas he isn’t.
• Most sellers ask for too much money, and until there’s a second offer, it’s hard to know what the right price is.
• You’d be surprised at how many people would say yes to an offer.

Jog, walk, or drive a certain area once a month for ten minutes.

• You’ll find some of the best real estate investments by driving around. He might talk to postal workers, moving truck workers, retailers, and so forth to better understand a neighborhood. 

Shop for bargains in all markets.

• “Profits are made in the buying, not in the selling.”

Look in the right places. 

• Most people buy with real estate agents. Robert Kiyosaki buys at the foreclosure auction.

Look for people who want to buy first. Then look for someone who wants to sell.

• When buying property, find a seller first then find a person who’s looking to sell their property and buy through them.
• If your business is buying something in bulk, call some friends up to see if they’re looking for that as well. Then, you can negotiate deals for having a large bulk purchase, so you get the best deal on what you’re buying.

Learn from history.

• “All the big companies on the stock exchange started out as small companies.”

Action always beats inaction.

Robert’s friend was once trying to save up for his four children’s college educations. But with only $12,000. It was clear it wasn’t going to happen any time soon. He advised his friend to buy a property in Phoenix since there was a slump in the market. After two weeks, they found a three-bedroom, two bathroom home in a good area. The homeowner was desperate to sell. They ended up buying the property for $79,000, even though the owner wanted $102,000.  His friend needed a down payment of $7,900. Each month after all expenses were paid, his friend pocketed $125. He planned to keep the house for 12 years. He used his $125 to pay down the mortgage even faster. Three years later, someone offered him $156,000 for the house. Robert advised him to sell it using a 1031 tax-deferred exchange. Next, he bought a mini-storage facility. After three months, he was making $1,000 a month that he put into the college fund. A couple of years later, he sold that mini-warehouse for close to $330,000. His next investment made him $3,000 a month in income, going back to the college fund. The man now feels confident in his ability to pay for his children’s college education. And it all started with only $7,900.

There are three types of income

• Ordinary earned

Poor dad: ordinary earned, get a safe and secure job

Rich dad: portfolio and passive, make money work for you

“The key to financial freedom and great wealth is a person’s ability to convert earned income into passive and/or portfolio income.”

Warren Buffett advises that “Risk comes from not knowing what you’re doing.”

Rich dad would often say, “If you want to be rich, you must know what kind of income to work hard for, how to keep it, and how to protect it from loss. That is the key to great wealth… If you do not understand the differences in those three incomes and do not learn the skills on how to acquire and protect those incomes, you will probably spend your life earning less than you could and working harder than you should.”

Your destiny relies on how you spend your money and your time. Your family’s future will be determined by your choices today.

You can buy Rich Dad Poor Dad by Robert Kiyosaki on Amazon .

Inspirational Book Reviews

I only write a review if the book inspired me to change my life in some way

Rich Dad Poor Dad by Robert T. Kiyosaki – book review

I read Rich Dad Poor Dad written by Robert T. Kiyosaki on my Kindle and despite all the negative reviews really enjoyed it. I think the criticism comes from an expectation that this book would be some kind of how to get rich guide. Instead Rich Dad Poor Dad is more about principles. His rich dad is not actually his father, but the father of a friend and someone he worked for when he was very young. His poor dad was his actual father a college professor. Much of the book is about stories he told about both of his Dad’s and the lessons he learned from these encounters. The book is about principles, not a step by step guide to obtaining wealth, although anyone that follows these  principles can then do the studying needed to make smart investments.

Here are some of the key principles discussed in the book:

• Pay yourself first – While this is not a new idea, it is emphasized as the technique you should be using to build wealth.
• Focus on Assets – The author doesn’t view things like your house or car as an asset. Assets are investments that generate income. This is why paying yourself first and using that money to buy assets is so important to building wealth.
• Learn about money – A lot of this book is devoted to the importance of spending time learning about money. There as several examples about how Robert attended a seminar and then put what he learned into practice to make a lot of money.
• Regular – income from a job for time you work.
• Passive – This could be something like rental income. It is typically income you get for making an initial transaction / purchase but have to do little or nothing later on.
• Portfolio – This is typically equities (stocks) where the income results from capital gains.
• Use debt wisely – Do not finance personal luxuries like cars, boats, etc. This type of debt does not create income and could have been used to purchase assets.

The principles listed above are only a few of the many that are written about by the author.

Recommendation

Interestingly, I had passed on reading this book for some time mostly due to the poor reviews it received, but fortunately I decided for myself to give it a shot. I actually enjoyed reading it and liked the story of having a Rich Dad and a Poor Dad to highlight the principles that Robert learned. Is there some shameless marketing in the book, yes in the Kindle version the last 18% of the book is a list of all his other books. What I liked about the book is that you can compare your own financial management to the principles outlined in the book, which can result in some changes in the way you look at money and how you are managing it. I would recommend the book for anyone who is not an expert in investing or finance, which is most of the population. Don’t read it if you are looking for a book on how to invest in stocks or real estate. You won’t find that kind of information here and there are many other books to read on those subjects that will go into great detail and help you build your knowledge. Like I said this book is about using Financial Principles to guide your journey to building wealth.

If you would like to support this blog, you can purchase this book at:

About the Author

Robert Toru Kiyosaki (born April 8, 1947) is an American businessman and author. Kiyosaki is the founder of Rich Global LLC and the Rich Dad Company, a private financial education company that provides personal finance and business education to people through books and videos. The company’s main revenues come from franchisees of the Rich Dad seminars that are conducted by independent people using Kiyosaki’s brand name for a fee. He is also the creator of the Cashflow board and software games to educate adults and children about business and financial concepts.

Kiyosaki’s seminars in the US and Canada are conducted in collaboration with a company called Whitney Information Network and are contracted out to local companies as franchisees in other countries. However, some attendees have sued Kiyosaki on claims that his high-priced seminars did not deliver anything special.

Kiyosaki is the author of more than 26 books, including the international self-published personal finance Rich Dad Poor Dad series of books which has been translated into 51 languages and sold over 27 million copies worldwide. He has been criticized for advocating the practices of debatable legality perceived as “get rich quick” philosophy. Kiyosaki is the subject of a class action suit against him by people who attended his seminars and has been the subject of two investigative documentaries by CBC Canada and WTAE USA. Kiyosaki’s company filed for bankruptcy in 2012.

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Published by josephsacco

Part-time philosopher and writer. I enjoy yoga, meditation, blogging, reading, and strength training. It is the goal of my writing to inspire people so that they can create a life filled with meaning and contribution. View all posts by josephsacco

One thought on “ Rich Dad Poor Dad by Robert T. Kiyosaki – book review ”

I loved how well you are able to express your opinions- so clear and effective. I have also recently written a review on the same book- I would love to hear your feedback. I don’t want to miss out on your future writings, thus I have followed your blog. 🙂

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About | Essays | Notes | Newsletter | Book Lists

• Scholarships

Rich Dad Poor Dad by Robert Kiyosaki

Reading Time: 13 minutes

Rich Dad Poor Dad Summary

Rich Dad Poor Dad is the crash-course financial education that you should have learned in school. Robert Kiyosaki tells stories about what he learned from his two dads to deliver valuable lessons for any financial education. You will learn the difference between working for money vs. having your money work for you, why buying a house may not be a good idea, and how to overcome the barriers in your mind that stop you from having the financial life you want.

Buy this book on Amazon

Access My Searchable Collection of 100+ Book Notes

Key Takeaways

Lesson 1: the rich don’t work for money.

“The poor and the middle class work for money. The rich have money work for them.”

Life pushes everyone around. Some people figure out how to learn from being pushed around. Other people fight back and blame other people for their problems. The first group succeeds. The second group does not.

Most people have a price because they’re afraid of not having money. So they settle for a deal, work hard, and then get excited about all the things money can buy for them. They stay in that cycle for the rest of their lives, not realizing they may have settled for something less than what they’re worth.

The Rat Race is driven by people who are controlled by fear and greed. Their fear of not having money drives them to get up, go to work, and pay their bills. When they get paid more, their desire drives them to increase their spending and requires them to stay in the cycle of working incessantly. Most people in this cycle believe that money will solve the fear that they feel, but it never does.

Many people with lots of money are more driven by fear than people without money. That’s because they fear losing what they have earned and the social and other consequences of that loss. This fear drives them to continue in the Rat Race long after they have enough money to exit the game.

The first step to avoiding the traps caused by fear and desire is to recognize these two emotions as powerful forces in driving most human behavior. You cannot eliminate these emotions, but you can become less reactive to them. And in doing so, you can stop them from allowing them to have an outsized influence on your decision-making.

You don’t need to be a financial genius to create enormous wealth. But you do need to break free from the desire for a paycheck and the short-term security that comes with it. And once you do, you can start seeing opportunities that will create far more money than you could earn as an employee.

Great quotes:

• “Life pushes all of us around. Some people give up and others fight. A few learn the lesson and move on. They welcome life pushing them around.”
• “A job is really a short-term solution to a long-term problem.”
• “It’s fear that keeps most people working at a job: the fear of not paying the bills, the fear of being fired, the fear of not having enough money, and the fear of starting over. That’s the price of studying to learn a profession or trade, and then working for money. Most people become a slave to money – and then get angry with their boss.”

Lesson 2: Why Teach Financial Literacy

“It’s not how much money you make. It’s how much money you keep.”

Financial literacy is the education you need to learn how to make, grow, and keep your money over time. Without being financially literate, you can end up making a lot of money and still being broke. With it, you can learn smart ways to make money work for you over time.

Formal schooling does not teach financial literacy. The result is that most people leave school with a heavy pile of debt and a weak financial foundation. They chase the American Dream, get into debt, and then look for ways to get-rich-quick to solve their problems.

These efforts are a lot like trying to build a skyscraper on a weak foundation. Instead of the Empire State Building, you end up with a wobbly tour that’s highly vulnerable.

The first rule of finance is to know the difference between assets and liabilities. Assets are things you own that generate income for you. Liabilities, on the other hand, take money from you. Rich people focus on acquiring assets, not liabilities. In other words, they buy assets to make sure that their asset column is hearty.

Despite this, people pour their money into liabilities, like expensive cars and other material items that cost them money. Instead, they should look to acquire more assets over time (e.g., real estate, stocks, bonds, IP, and other things that make you money). When you have enough assets, you don’t have to rely on a salary to earn income.

Many people learn how to work hard for their money, but fail to learn how to make their money work for them. And without that foundation, they’re forever caught in the Rat Race.

For example, many people believe their home is an asset. But it is really a liability. That’s because it takes money out of your pocket with taxes, expenses, any losses in value, and the opportunities you miss by having your money tied up in a home.

Instead of buying a home, it’s better to first buy income-generating assets that will generate enough cash flow to pay for the mortgage payment on your home. Once you have enough assets to cover all of your expenses and more, you can invest the balance into more assets, thus producing more income and giving you the freedom to escape the Rat Race.

One definition of wealth is that of R. Buckminster Fuller: “Wealth is a person’s ability to survive so many number of days forward – or, if I stopped working today, how long could I survive?” The first step to being wealthy is to ensure that the income generated from your assets exceeds your expenses.

• “Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets.”
• “If your pattern is to spend everything you get, most likely an increase in cash will just result in an increase in spending.”
• “In 80 percent of most families, the financial story paints a picture of hard work to get ahead. However, this effort is for naught because they spend their lives buying liabilities instead of assets.”

Lesson 3: Mind Your Own Business

“The rich focus on their asset columns while everyone else focuses on their income statements.”

Most people spend their lives working for other people. That can include their employer, the government via taxes, and banks via their mortgages. Most people stay trapped in this cycle of working for other people and making those people rich instead of themselves.

You don’t have to start your own company to break this cycle. In fact, all you have to do is focus on growing your assets, instead of only relying on your income. Many people live paycheck to paycheck and can never free themselves from the Rat Race because they don’t have assets working for them.

Net worth is a bad proxy for how much money you have because often the things that you use to make that calculation aren’t as valuable as you think they are, or if they have gained value, they will trigger taxes on the gain once they’re sold.

When you’re young, the best thing you can do is keep your liabilities low and start using your excess cash flow from your job to build a solid foundation of assets. There are a few different types of common assets:

• A business that does not require your presence. For example, you own a business that is managed or run by other people. If you have to be there, it’s a job, not a business.
• Income-generating real estate
• Notes (IOUs)
• Royalties from intellectual property such as music, scripts, and patents
• Anything else that has value, produces income or appreciates, and has a ready market

It’s important to focus on acquiring assets that you love. Some people love real estate and startups; other people feel burdened or scared by these types of assets. An important part of your asset acquisition strategy is to invest in things that align with forms of income generation that work for you.

• “Once a dollar goes into it, never let it come out. Think of it this way: Once a dollar goes into your asset column, it becomes your employee. The best thing about money is that it works 24 hours a day and can work for generations.”
• “Financial struggle is often directly the result of people working all their lives for someone else. Many people will simply have nothing at the end of their working days to show for their efforts.”
• “An important distinction is that rich people buy luxuries last, while the poor and middle class tend to buy luxuries first.”

Lesson 4: The History of Taxes and the Power of Corporations

“My rich dad just played the game smart, and he did it through corporations – the biggest secret of the rich.”

While it’s commonly believed that the rich should pay more in taxes than the poor, it’s often the middle class and upper-middle class who pay the most taxes. While taxes were originally levied only on the rich, the need to expand the tax base grew as the government grew and needed to fund itself. That leads to income tax being a larger burden on people at the lower and middle rungs of the socioeconomic ladder.

The primary way that the rich have been able to avoid taxes is through corporations. Corporations benefit from having a lower income tax rate than individuals have, and many of a corporation’s expenses can be paid with pre-tax dollars.

While tax law has tried to find new ways to tax the rich, there are often new loopholes that they exploit. For example, one tax law allows you to delay paying taxes on a piece of real estate that is sold for a capital gain by exchanging it for a more expensive piece of real estate.

So if you continue to trade up your real estate, you don’t have to pay any taxes until you sell. That’s simply one way in which savvy people who understand taxes keep more of their money than people who don’t know the regulations.

That’s why tax advisors who know what they’re doing are often worth the cost. They prevent you from paying more than you need to the government.

The higher your financial IQ, the more you’ll find opportunities to make your money go further. A few key areas of financial IQ include:

• Accounting: being able to read financial statements and understanding the strengths and weaknesses of a business
• Investing: Understanding strategies and models for making money
• Understanding markets: knowing about supply, demand, and market conditions
• Understanding the law: knowing about tax advantages and protections

The best example of using financial IQ is having a corporation. Instead of paying your expenses after you’ve been taxed on your paycheck, you can pay for expenses with pre-tax dollars, lowering your tax burden and your expense burden by knowing how to use legal entities.

• “Every time people try to punish the rich, the rich don’t simply comply. They react. They have the money, power, and intent to change things. They don’t just sit there and voluntarily pay more taxes.”
• “If you work for money, you give the power to your employer. If money works for you, you keep the power and control it.”
• “Employees earn and get taxed, and they try to live on what is left. A corporation earns, spends everything it can, and is taxed on anything that is left. It’s one of the biggest legal tax loopholes that the rich use.”

Lesson 5: The Rich Invent Money

“Often in the real world, it’s not the smart who get ahead, but the bold.”

Avoiding financial struggle and acquiring financial intelligence requires knowledge, but it also requires the courage to act in the face of uncertainty and to avoid “playing it safe.” Those who are willing to act boldly are the ones who see opportunities and seize them, instead of sitting on the sidelines wondering how things may have played out.

One thing that holds people back with money is holding onto the way that “things used to be.” If you get used to things and don’t find ways to adapt to a fast-changing world, you’ll likely be left behind.

Once you build the habit of acting on opportunities, not only will you learn more, but luck will eventually come in your favor. Even if you learn to play the game and figure out how to play it well, it’s important to know that money is not your most valuable asset. Your mind is the key to financial independence, so it’s important to train and treat your mind well.

The truth is that markets go up and down, and opportunities come and go. The important thing is to be able to spot things as they come, have the skills to evaluate them, and move forward with ideas that have a high probability of success and low downside risk. If you can do that well, you improve your chance of moving beyond the poor and middle class.

With money, you won’t always win. You’ll make losing investments and winning ones. The key is to get better over time and not to beat yourself up over the losses.

There are two types of investors – ones who buy packaged investments from a retail outlet, and ones who create investments. To be the second type of investor, you need three skills:

• The ability to find opportunities that everyone else missed
• The ability to raise money
• The ability to hire and organize people that are smarter than you
• “Old ideas are some people’s biggest liability. It is a liability simply because they fail to realize that while that idea or way of doing something was an asset yesterday, yesterday is gone.”
• “If the opportunity is too complex and I do not understand the investment, I don’t do it. Simple math and common sense are all you need to do well financially.”
• “It is not gambling if you know what you’re doing. It is gambling if you’re just throwing money into a deal and praying.”

Lesson 6: Work to Learn – Don’t Work for Money

“Job security meant everything to my educated dad. Learning meant everything to my rich dad.”

Many people live opportunities and money on the table by specializing too much and failing to learn one more skill. Most people focus simply on working hard, but that’s often not enough. If you’re a great writer and write a great book, you still not be a best-selling author. But if you learn how to sell and become a good marketer as well, you may exponentially increase your chances of having a best-seller. Many people are not willing and excited about learning that one skill that will take them to the next level.

One way to think about a job is that it is a learning opportunity. Making money at a job is great, but if you learn new skills, you start to build a stack of experience that can be valuable over your life. That’s why it may be good to try many different types of jobs while you’re young.

A job in which you have a high rate of learning is far more valuable than a secure job, with good pay and benefits over the short term. It’s often better to learn skills and make a little bit less money.

There are three management skills needed for success:

• Management of cash flow
• Management of systems
• Management of people

The most important specialized skills are sales and marketing. Being able to communicate well via writing, speaking, and negotiating are skills that help you in all areas of life. Many people are held back in the realm of communication because they fear rejection.

• Life is much like going to the gym. The most painful part is deciding to go. Once you get past that, it’s easy.”
• “The world is filled with talented poor people. All too often, they’re poor or struggle financially or earn less than they are capable of, not because of what they know, but because of what they do not know.”
• “I recommend to young people to seek work for what they will learn, more than what they will earn.”

Lesson 7: Overcoming Obstacles

“The primary difference between a rich person and a poor person is how they manage fear.”

There are 5 core reasons why financially literate people may still not have good cash flow:

Overcoming fear

Everyone has a fear of losing money. It’s how you respond to that fear that differentiates a rich person from a poor person. When you inevitably lose money, the important thing is to learn from the experience and remain in the game. Instead of being down about your failures, learn to be inspired by them. Figure out how you can turn the obstacle into an opportunity down the road. Most people end up playing not to lose when the best strategy is to play to win. You don’t win big with a safe, balanced portfolio.

Overcoming cynicism

Doubt – whether it’s self-doubt or doubts of people in our lives – often stops us from acting. But often the best opportunities are found when everyone is fearful, including you, and you find the courage to act anyway. When you learn to work through self-doubt, you start to see more opportunities and to be less influenced by other cynical people who lead you to bad decisions.

Overcoming laziness

A common form of laziness is staying too busy to take care of things in your life. In this state, you convince yourself that you can’t do something. For example, you may say you “cant afford it.” That may be true, but if you ask “How can I afford it?” instead, you may find solutions to your problem. Asking better questions helps you reframe the problem and see things that you would not otherwise see. And that’s how progress happens.

Overcoming bad habits

Successful people often have good habits. Those good habits often require a sacrifice, but in the long run, it’s worth it if it leads you closer to your goals.

Overcoming arrogance

Staying humble when you don’t know something and avoiding thinking that you’re infallible is a key ingredient to preserving and growing your wealth. It’s easy to lose money when you become overconfident.

• “For most people, the reason they don’t win financially is because the pain of losing money is far greater than the joy of being rich.”
• “Getting out of the Rat Race is technically easy. It doesn’t take much education, but those doubts are cripplers for most people.”
• “I’ve never met a golfer who has never lost a golf ball. I’ve never met people who have fallen in love who have never had their heart broken. And I’ve never met someone rich who has never lost money.”

Lesson 8: Getting Started

“There is gold everywhere. Most people are not trained to see it.”

Learning how to make money, exit the Rat Race, and become financially successful takes trial and error, but with enough effort, you’ll find your way. Here are 10 steps to get started:

• Find a reason greater than reality: the power of spirit . Many people want to be financially free, but they don’t want to put in the work to get there. You need a core motivator to make sure you’re up to the task. One idea is to write the things you don’t want (e.g., I don’t want a job), and to use that list as the motivation for becoming financially free. Then list the things you do want (e.g., to travel anywhere in the world anytime you want). Those emotional reasons can drive you to do the work.
• Make daily choices: the power of choice . Every day you make choices that will move you toward where you want to go or away from it. For example, you can choose to think money is evil and avoid learning about it, or you can choose to see money as a tool to create the life you want and learn about. One group will likely be more successful than the other. The best choice is to choose to learn.
• Choose friends carefully: the power of association . Your friends can be powerful teachers about what to do and what not to do. It’s important to learn from friends but to make your own judgments and avoid folling the crowd. Good bargains are rarely found when everyone shows up. Don’t try to time the market. Have friends who can help you see opportunities before they’re saturated.
• Master a formula and then learn a new one: the power of learning quickly . Most people follow a standard formula – work, earn, pay the bills, buy mutual funds, and go back to work. That’s one formula, but there are many formulas that may work better for you. The ability to learn is your greatest asset.
• Pay yourself first: the power of self-discipline . Learn how to have the courage to do what needs to be done, even when it’s difficult.
• Pay your brokers well: the power of good advice . Don’t look for discounts on advice.  Good advice is priceless  and often worth paying for.
• Be an Indian giver: the power of getting something for nothing . Find investment opportunities that pay you back quickly.
• Use assets to buy luxuries: the power of focus . Buy the stuff you want with income from your assets, instead of trading away your assets for a liability.
• Choose heroes: the power of myth . Heroes can inspire you to be more of what you want to be. Choose your heroes wisely.
• Teach and you shall receive: the power of giving . Whenever you’re feeling short of something – money, love, friendship, etc. – try giving it first. You will often receive it in return. Being generous with yourself and others pays off in the long run.
• “If you’re tired of what you’re doing, or you’re not making enough, it’s simply a case of changing the formula via which you make money.”
• “The easy road often becomes hard, and the hard road often becomes easy.”
• “Each of us knows people who are highly educated, or believe they are smart, but their balance sheet paints a different picture.”

Lesson 9: Some To Do’s

Here are some more things you can consider doing:

• Stop doing what you’re doing. Try taking a break to assess what is working or not working for you.
• Look for new ideas. Read books, explore the world, and try to find new opportunities.
• Find someone who has done what you want to do. Get their advice.
• Learn. Take classes, read, and talk with people.
• Look for bargains.
• Learn from history.
• Action always beats inaction. When in doubt, act.

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Rich Dad, Poor Dad

What the Rich Teach Their Kids about Money--that the Poor and the Middle Class Do Not!

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• Apr 2000, 223 pages
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July 25, 2020

Rich dad poor dad by robert t. kiyosaki.

The reality is that the rich are not taxed. It's the middle class who pays for the poor, especially the educated upper-income middle class.

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