Trust me, I know this book is famous, but if everyone actually followed the advice Mr. Kiyosaki gives, the world would be a better place. While now-a-days most of the videos this guy makes seem like a scam, I truly believe this book can transform many peoples lives. This book was written in the 90’s but the advice remains relevant today.
Robert Kiyosaki’s book starts off with a story about his biological father(poor dad) and his friends dad(rich dad). His rich dad teaches him the value of money the actual value. The author capitalizes on this story by showing he was under paid at his job but learned a way to make money passively off of things that he would get for free.
The second chapter exclaims how important learning accounting is to build a future. In truth, if you learn accounting you learn how to create a cash flow, invest in under valued stock, manage your own personal finance and understand how the business world runs(cash is king baby). He exclaims the ideas that investing in yourself before you pay anyone else is important and I share the same sentiment.
Chapter three helps exemplify the ideology that rich people focus on their asset column while everyone else focuses on their income columns. Is this true? Well considering most of the worlds population has been converted to a consumer/capitalist society, OF COURSE! He also hits hard on the fact that putting as much money as you can in assets that you love and want to grow. Grow your assets grow your empire.
Chapter four talks about the history of taxes. He really opens up the truth about how rich people avoid taxes…legally. Yeah, this is a bit of a controversial subject, considering that the middle class does, in fact, pay the most taxes. However, he also teaches you how hiding your taxes in corporations is beneficial and how to tie up your taxable income in un-taxable income. Whether or not you agree, these are the same strategies that the rich people employ.
Chapter five talks about how rich people find ways to make money out of nothing. Here at The Financial Foundry we like to call it financial creativity. This is the act of making money from other sources or making money from nothing. These opportunities are everywhere but you have to be creative to find it. No degree in the world can give you this, it is developed through experience and exposure. You will not always win and your ideas will not always pan out but the more exposure to financial ventures, the more exposure you gain the better off you are financially. Be bold!
Chapter six is inter-connected to the last chapter. It hooks into the idea that you should not be working for money you should be working for opportunity. Everyday, every person in the world is exposed to ideas or potential solutions that you may or may not know about yet. Every area has a specialization or gap in the process that can be fixed or improved. It takes the tenacity and bold entrepreneurship skills to act on these opportunities. The point of this chapter is not to work for money but to work to learn. This is a repeated ideology that is highlighted in the first chapter from the lesson his rich dad taught him. Look for opportunities in everything.
Chapter seven is about overcoming the problems that most financially literate people have not yet overcome. I have seen many people in my life stand in place and become very cynical of all my life choices. The difference between them and me is I am rich, both mentally and financially. You see, if I lost all my money today it is ok, why? Because I understand how to make money and can do it from anywhere without any resources(aside from friends, family and colleagues). A lot of people have bad spending habits, will not take risks and are very cynical(mostly of themselves). If you are always saying the words, “cant”, “not”, “impossible”, “wrong” than you probably don’t want to put in the work or take risks and that is okay for some people. Obviously it is financial suicide to gamble all your money at the casino but if you’re smart you can mitigate losses. Life is about mitigating losses and so it goes in the financial/business sector as well.
Chapter 8 gives amazing advice. Deals are everywhere everyday. I have already hit on this but he really hits on why you should be paying yourself first and how to win in the financial sector.
Overall this book is an amazing book that can help you fast track your mental financial literacy. Robert Kiyosaki is a financial legend and this book is his biggest legacy. “Write your name in a gold bar and it will be gone in a day. Put your ideas in young minds and your legacy will last forever” -Unknown.
I love reading finance books and highly recommend this one. If you have comments or questions hit me up at email@example.com . Have an amazing week!