Updated: Jan 24
Ready to unlock the secrets of attaining and sustaining wealth that wealthy individuals impart to their children? We have summarized Robert Kiyosaki's famous book, Rich Dad Poor Dad: What The Rich Teach Their Kids About Money That The Poor & Middle Class Do Not. It begins with the story of 9-year old Robert and his friend Mike, who wanted to become rich but weren't sure how.
This book is based on Robert's own experiences growing up with a well-educated father who was financially stable but wasn't wealthy, and his friend Mike’s dad who was a successful business owner that understood how to create wealth and who became a financial mentor to both boys. Robert’s well-educated but “poor dad” taught Robert to “Go to school, study, and find a good job.” It’s familiar advice – but it’s saying “Go and join the rat race, the endless routine of working for everyone but yourself.”
So let's review the 6 lessons Robert learned as a young boy that became the basis for his book and his wealth.
The first lesson is that wealthy people don't only work for money, they also have money work for them. Kiyosaki suggests that if you just stay on the hamster wheel for your entire life, it will enrich someone, but it won’t be you – it’s your boss whose wallet you’ll be fattening. To achieve wealth, you must develop a wealth mindset and learn to think outside of your 9 to 5 job. This doesn’t mean you should quit your day job, but explore ways to generate an income stream outside of it.
Kiyosaki's second lesson is to educate yourself about finances, identify real assets and invest in them vs ones that look like assets but are liabilities. You must learn the basics of budgeting, investing, and building wealth through smart financial decisions. This way, your money will start to work for you and create passive income streams. You can do this by embracing the third lesson which is to keep your day job but minimize your expenses where possible and have your side business & investments earn money for you.
Lesson four states that it is necessary to harness the power of the tax system to keep more of your hard-earned money. By understanding the tax code, you can take advantage of opportunities available to business owners.
Lesson five emphasizes that making money takes guts. Learning to take risks is one of the many secrets of the wealthy. In the real world, it’s often not the brilliant who get ahead: it’s the ones with chutzpah! Financial intelligence and courage allow the rich to seize opportunities that lead to financial gain.
Following Kiyosaki's Rule Six, we must take a more holistic approach to learn and leave the overspecialization aspect to those with higher degrees. As you continue further in your educational journey, areas of focus become increasingly narrow; medical graduates often choose specialties such as orthopedics or pediatrics soon after they finish their studies. Specializing can be beneficial for some, yet it didn't seem to help Robert's father who had a Ph.D. but still struggled financially. On the other hand, Mike's rich dad -- despite never having finished eighth grade -- flourished thanks to his wide-ranging knowledge base.
So that’s it – we’ve reached the end, covering the six main lessons from Robert Kiyosaki’s Rich Dad, Poor Dad. Remember, it was this very advice that laid the groundwork for Kiyosaki’s current fortune – a net worth of an estimated one hundred million dollars.
For a deeper dive into Robert Kiyosaki’s teachings, we recommend reading the book Rich Dad, Poor Dad.
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