What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!
Published in April 1997, Robert Kiyosaki’s bestselling book Rich Dad Poor Dad became a cult phenomenon, attracting fans from all over who wanted financial education explained in layman’s terms.
Banking on the comical relief and drama made from receiving contrasting advice from two differing authority figures – a highly educated biological father who made poor financial decisions, and an “adoptive dad,” the rich father of his school friend who became his mentor, Robert explored and researched common beliefs that usually encumber people as they grow up.
Candidly written using straight to the point style, Robert used the tool of a well-intentioned antagonist (his real dad) who was a buffoon in financial matters, and the selfless, well-meaning “wealthy dad” to deliver concepts and lessons to his readers in a way that resonate deeply within, making them more receptive to his ideas.
Robert examined the common misconceptions about jobs and careers and the myth of job security versus the massive rewards of building a business.
He defies prevailing beliefs that you need a lot of capital in order to succeed in a business. He also resists outdated middle-class mindsets about asset acquisition and shows that liabilities are really what you’ve been collecting all this time.
If you’re a parent, it’s important to read this book and teach your children the right way to think about money. The message of Rich Dad Poor Dad touched so many lives and switched mindsets that some multi-level marketing (MLM) groups made this book required reading for new members.
Rich Dad is ranked #4 in Amazon Kindle’s list of Top Personal Finance books of all time. Kiyosaki is ranked # 4 in Amazon’s top authors in the Business & Money category.
This book also made is to the top bestsellers list on Business Week, The New York Times, the Wall Street Journal and USA Today. Rich Dad Poor Dad was declared as the # 1 Money Book by USA Today 2 years in a row.
It has sold 27 million copies and has been translated into 51 languages.
I remember those days when I too was an MLM shill, trying to do extra gigs on the side to augment my yearly income of $33K working as a clerk in an auto parts company.
No matter how hard I worked and how much effort I put into marketing, I didn’t see any dent in my finances. Meeting my MLM sales quotas didn’t make me rich, but it made my upline earn a lot of money.
The promise of creating lifelong residual incomes turned out to be just that – a sour promise that never ran true. The only income I got was a few measly dollars every month.
I didn’t actually partner with my upline, she partnered with my sweat, blood, and youthful energy to sell products that never made me rich. Oh, if only somebody told me before how this business model only benefits the early few, I would never have set foot in a training room.
Never giving up on my dreams of financial independence, I continued scouring the internet for other side hustles, money-making opportunities that were legit, and writing about them in my passion blog.
That’s why I stumbled on Dan’s elite online training program to teach students how to build a digital empire based on the lead-gen biz model.
It was the best decision I ever made in my young life. There’s truly a reward for those who never give up. Read on to find out more about my biz.
- About the Author
- Parenting, Hawaii Style
- Things My Poor Dad Told Me:
- Things My Rich Dad Told Me:
- Lesson 1: The Rich Don’t Chase Money
- Lesson 2: The Importance of Learning Finance
- Lesson 3: Mind Your Own Business
- Lesson 4: Corporations
- Lesson 5: How the Rich Invent Money
- Lesson 6: Work to Learn, not Work to Get Paid
- Lesson 7: Overcome Obstacles
- Lesson 8: Get Started
- To Do’s
- “How I Killed My Job and Started a Lead Generation Biz that Earns $50K/Mo Passive Income in 2019”
- Why Lead Generation Business Model is Superior to Other Online Hustles
About the Author
Millionaire author. Serial entrepreneur. Motivational speaker. Inspirational writer. Successful franchise owner. Doting husband.
All of these can describe Robert Kiyosaki. But before all the accolades were heaped on him, Robert was a good son, first and foremost.
Born in Hilo, Hawaii in 1947, Robert grew up in a strict middle-class home to a father who became a high-ranking government official in Hawaii’s Board of Education, and a nurse mother. The family belonged to fourth-generation Japanese immigrant group.
Robert grew up with three other siblings and immediately signed up to join the U.S. Naval Academy after high school. He also served in the Vietnam War as a helicopter pilot.
After he was honorably discharged from the military, Robert tried several business ventures selling surfer wallets and T-shirts, etc. Both these early ventures failed.
In 1992, his first book came out: If You Want to Be Rich and Happy, Don’t Go To School, followed by Rich Dad Poor Dad in 1997.
Robert’s net worth is estimated to be at US$80 million. Majority of his income come from seminar on personal finance/education. He also owns multiple apartment units and oil wells all over the USA.
He was featured as a guest on the Oprah Winfrey show, where his exposure triggered a lot of sales of his books and seminar products. He also has a massive presence on YouTube and runs the Rich Dad channel, which has now acquired 627K+ subscribers.
Robert is now 72 years old. On the occasion of his seminal book’s 20th anniversary, re-released a special edition in April 2019.
He had created an entire industry around financial education and business success and followed the success of Rich Dad Poor Dad with 20+ other books.
He also hold workshops, trainings, seminars, online courses all focused on improving the mindset of his students with regards to money and wealth accumulation.
Parenting, Hawaii Style
Robert Kiyosaki’s biological father was a highly educated teacher who held a PhD from Stanford University on a full ride scholarship. He loved to teach and didn’t bring home a lot of money. He gives his son staid advice about finances with the intention of making Robert grow up and taste the same life he built.
He grew up comfortable, although not wealthy, on the island of Hilo, Hawaii with a best friend, Mike, whose father owned a chain of superettes (convenient shops), a construction company, and several restaurants. He called this man his “rich dad” and he became Robert’s proxy father in all things business-related.
Rich dad hired Robert to work for him at ten cents an hour stocking shelves in his grocery stores, cleaning, and completing errands, thus initiating his exposure Robert to the entrepreneurial aspect of making a living when he was only nine.
After complaining about the unfairness of getting paid only a dime for every hour worked, his rich dad then asked him to work for free in exchange part for business education.
Robert agreed, and thus started his life-long quest to excel in business and challenge the accepted mentality that enslaved so many people, including his smart but poor dad.
Although both successful in their own way, Robert’s two ‘dads’ gave him such contrasting advice that it gave him pause and made him reflect on the wisdom of their words even at such a young age.
His rich dad’s incisive, penetrating questions and hands-on training trained Robert to question everything, question his parents’ choices in careers, question taxation and how smart people avoid getting taxed highly, question the wisdom of pursuing higher education rather than getting more training in business.
Growing up the way he did armed him with one of the most essential lessons to being a successful businessman: gaining the courage to oppose the tide.
After such reflection, Robert decided to listen to his adoptive dad, the wealthy, free-spirited entrepreneur, a decision which shaped the rest of his life.
He was taught that money and financial education are forms of power, and if you get educated about handling money, you gain power over it and can build wealth.
Robert realized that American schools don’t teach financial education, and it shows when highly educated graduates are up to their eyeballs in debt, sworn to a life of always chasing security because they’re not well versed in the art of building wealth.
Robert compiled a list by which he compared his two dad’s opposing views, giving him a chance to weigh their opinions in a way that benefited him the most.
Things My Poor Dad Told Me:
- The love of money is the root of all evil
- I can’t afford it
- Study hard so you can find a good company to work for
- The reason I’m not rich is because I have you kids
- When it comes to money, play it safe, don’t take risks
- I’ll never be rich
- Money doesn’t matter
- Our home is our largest investment and our greatest asset
- Pay your bills first
- I believe that the government will take care of my needs
- Write an impressive resume so you could find a good job
- Study hard in school so you can get a stable job later
Things My Rich Dad Told Me:
- The lack of money is the root of all evil
- How can I afford it?
- Study hard so you can find a good company to buy
- The reason I must be rich is because I have you kids
- Learn to manage risks
- Broke is temporary, poor is eternal
- Money in power
- Your house is a liability, and if your house is your largest investment, you’re in trouble
- I pay my bills last
- I believe in total financial self-reliance. I’m against all kinds of entitlement mentality because it creates weak and financially needy people
- I’ll teach you how to write strong business and financial plans to create jobs
- School is the end, not the beginning
Lesson 1: The Rich Don’t Chase Money
The fear of going penniless motivates ordinary people to apply for jobs that enslaves them to a life of working to pay bills. The only emotions that motivate them are fear and greed. With the false security of a job that pays them a set amount of salary every payday, these people will never try to get out of their comfort zone to start a business.
“Stay in school, get good grades, find a secure job, retire with benefits.”
This is the old script most parents subscribed to all their life, and they then force their kids to get good grades in school so they will also live the ‘script.’
But if asked, these people may sometimes admit their discontent at such a mediocre existence. Before they followed the script, they might have had passions, artistic desires, plans to travel the world, plans that were dashed when the fear of an empty wallet grew bigger than the desire to pursue a life worth living.
The better alternative is to master the power of money. Use your emotions to think, not the other way around. A job is only a short-term fix for a long-term problem.
This is where the rich is a cut above others in the way they think about money – they set up opportunities to make money and have it multiply.
Lesson 2: The Importance of Learning Finance
Acquiring money without sound financial knowledge is a bankruptcy waiting to happen. If a person hasn’t been taught how to budget and manage $3,000, he won’t be able to manage $3,000,000.
Hence the stories about broke lottery winners who burned through millions of dollars of their winnings by buying stupid stuff and not planning ahead.
Set aside time to learn how to make money your best friend, how to tend it and water it to where it grows deep enough roots that it won’t need you anymore someday.
Part of this is learning about accounting, investing, markets, taxes, inflation, and the law. The more your grasp complex financial concepts, the more successful you’ll be in your business.
A strong financial foundation needs the following: solid knowledge of the difference between an asset and a liability. An asset puts money in your bank account. A liability takes that money out.
Lesson 3: Mind Your Own Business
Employed people mostly work for everyone but themselves – they enrich their employers or the owners of their company, then they pay their taxes to the government, then they pay the bank where they mortgaged their house.
When you see a financially struggling family, that didn’t happen overnight. That’s usually the culmination of a lifetime of making poor financial decisions, working everyday to make somebody else’s dreams come true, reporting every month to a boss whose only goal in life is to wring out one more drop productivity out of your lifeblood to turn a profit for the company.
Professionals have only their job as a source of income. Rich people, on the other hand, have their assets as sources of multiple income streams.
Companies use all kinds of feel-good type of slogans to foster a sense of community among their employees, but the bottom line us, they all want to work you to the bone until the workweek spits you out, drained and exhausted, to a parking lot of similarly miserable souls, grateful for two days’ freedom from the grind of work.
Instead of trying to climb the corporate ladder with the goal of getting a pay raise so you can increase your income column, focus on building up your asset column instead.
Mind your business, mind your assets, they should be your only focus. Don’t waste time making your boss richer and your company turn more profit, they won’t lift a finger when you’re hurt and need another way to pay off your bills.
Be smart about it though. Keep your day job but continue to increase your asset column. Refrain from unnecessary spending.
A lot of young couples get buried in debt because they use credit cards to buy items they don’t need to live up to a standard of life they can’t afford.
And this is where most schools fail their graduates. An overhaul of the education curriculum must be done to address the yawning financial education gap that turns kids into credit-hungry consumers.
Type of Real Assets:
- businesses run by other people (managers)
- mutual funds
- Notes (IOU)
- Real estate
- Royalties from music, books, patents
- any valuable item that produces income
Lesson 4: Corporations
Taxes were originally voted into law only for the wealthy citizens, but as government bureaucracies grew bigger and needed more funding, taxes were levied on the middle class. But the rich found ready loopholes and created corporation to limit their risks.
Knowledge of how a corporation works gives the rest an unfair playing field to lord it over the middle class. Corporations protect the rich because they’re taxed way less than an individual worker gets taxed.
Corporations can also write off certain expenses as tax deductible, saving even more money for the company.
Make sure each dollar in your asset column multiplies and gives birth to more dollars so that you can quit your day job and focus on nurturing your own business.
Read up and become very well versed on business law to protect yourself from lawsuits. A corporation can be an attractive target for lawsuit-happy individuals as corporations are perceived to have big pockets.
It’s only prudent to use several layers of legal protection to make yourself immune from the litigious in our society in order to keep the hard-earned income you’ve worked so hard for.
Lesson 5: How the Rich Invent Money
Each person naturally holds massive potential inside. Each one is gifted with a skill or talent that’s more developed than a few others. But self-doubt and insecurity get in the way of our “becoming” that we settle for safe, unfulfilling jobs that won’t rock the boat too much.
Once out of the safety of the academic gates, a person needs to rely on more than just his scholastic degrees to make it big: inner resolve, guts, bravado, sixth sense. This something extra, when called forth and used liberally in everyday dealings, makes the difference between a so-so future or an awesome one.
Develop your financial IQ in order to open up more options in your future. The world is constantly changing and the secure careers of yesterday will be taken over by automatons or younger, hungrier graduates.
Kiyosaki developed and launched a financial education game called Cashflow 101 specifically to familiarize his students with investment terms and understand complex financial concepts. It was released in 1996 and was a popular game that year.
Lesson 6: Work to Learn, not Work to Get Paid
Learn salesmanship and awesome negotiating skills. A skill that allows you to persuade other people to see the value of any product you’re offering is one more tool you can use and deploy from your arsenal of high-value skills.
Great talent isn’t enough to succeed, unfortunately. The world is filled with talented underpaid people. You also need to augment your skills and the most important upgrade is how to market.
Another important skill to learn is public relations. Even such soft skills as learning how to write exciting ad copy is very helpful to somebody who wants to grow a business that needs the attention of other people.
Learn a little bit of everything so you have an idea how to solve a wide variety of problems. Seek work that offers a lot of learning opportunities, not just rote assembly-line duties.
Lesson 7: Overcome Obstacles
These five emotions can be major hindrance to developing a successful asset column: fear, cynicism, sloth, bad habits, egotism.
Fear will always be present with every new venture, but it’s how you handle it that truly matters. Some people develop a genuine phobia about losing money so they will do everything to stretch that dollar until the eagle cries.
Don’t let the horror of potentially losing money dominate your deep desire to get rich and live a life of abundance. Choose to fight and be inspired by your failures and mistakes, use them as fuels to spur you further to reach your dreams.
Our minds can be such cruel little cynics, negative, whiny, and always focusing on the catastrophes that could happen if we don’t do things a certain way. Don’t let your mind run amok and keep you awake.
Discipline it to focus only on the steps that move you forward to reach your goals. Avoid people that amplify the “noises” in your head.
Unchecked fear results to a cynical mind, and a cynic never wins.
Laziness can be cured by a little greed. Use your desire for a better life for yourself and your family as ammunition to get your behind off the sofa and back in the office.
Again, discipline your mind so it can sustain long periods of mental effort. An active mind compels an active body to continue hustling despite the point of exhaustion.
Ask yourself “What’s in it for me?” so you can unlock that creative part of your brain that spits out solutions and suggestions to every problem imaginable. But that part of the brain is out of reach if your mindset remains negative and cynical.
Don’t let your habits control your behavior. The number one good habit to nurture is paying yourself first (self-investment) before you hie off and pay all the other bills.
Arrogance is ego combined with ignorance. It’s common to encounter arrogance in people who use it as a shield to hide their ignorance of a topic.
But ignorance should be a call to educate yourself on the subject more. Find an expert, read a book, look up the subject online. In this day of the information superhighway right at our fingertips, there’ no excuse to remain ignorant.
Lesson 8: Get Started
Each person has a financial genius inside him, some are just asleep. To call your genius first, Robert shares his 10-step process to develop your abilities to recognize God-given opportunities:
- find a reason greater than reality
- practice your power of choice daily
- choose your friends carefully
- learn a formula then master it
- pay yourself first
- pay your brokers well
- give without expecting something back (called being an “Indian giver”)
- your assets will buy your luxuries
- collect and emulate your heroes to fast-track learning
- teach and give first and it will come back to you in buckets
Stop what you’re doing, take a reflective pause and analyze which ones of your tasks are working and which are not.
Look for new investing ideas, read investment books and take action.
Keep a healthy, active lifestyle and exercise regularly. Some of you best business ideas will come to you when you’re doing something totally unrelated, like jogging in the park.
Action beats inaction. Learn to put your shoulder to the wheel and launch a task, complete a needed activity. Get things moving so you can receive the financial rewards due you.
Written so easily and clearly even a 13-year-old can grasp the lessons captured herein. Robert uses anecdotes effectively to set up the complex idea he’s going to discuss.
This was one of the books that made me view careers in a different light, making me question my choice of a safe job compared to my passion of being a business owner.
Even the short discussion about assets versus liabilities will be enough to job your mindset and make you cut that credit card into little pieces. The ideas presented are enlightening and really sensible but they were never discussed in schools!
Be aware that Kiyosaki’s financial education company Richdad will flood your email with a lot of offers as an offshoot of buying this book. The marketing emails can get annoying and spammy. Those 3-day seminars are just another way to up-sell you to a $50K mentorship package
Investigations by enterprising journalists also reveal that the “rich dad” in this book might just be a figment of Robert’s storytelling skills, used as a tool to deliver the message of financial independence more effectively.
Robert’s book also resulted to a lawsuit filed by his co-author against him due to financial breach when Robert inked a deal with Amway, an MLM firm, to market his book and make it required reading for its members.
A lot of financial experts also pushed back against some of Robert’s teachings stating the advice he dished out were completely incorrect and would result in financial sabotage if taken.
“How I Killed My Job and Started a Lead Generation Biz that Earns $50K/Mo Passive Income in 2019”
No, I’m not a limo driver, nor do I own a limo rental company. But I did make a pact with one lucky business owner who took a chance on my pitch and agreed to be my wealth partner, paying me a flat fee of $750 a month to get exclusive leads from customers looking for the kind of services he provides.
I learned to do this lead generation strategies when I enrolled in an elite online mentorship program back in 2014. I was still fully employed in a Japanese auto parts company then as a shipping clerk, but I set aside time after work to focus on Dan’s video tutorials.
I was a very focused student because I had no choice but to learn the business so thoroughly, I had no reason not to succeed.
My salary at the company I work for wasn’t cutting it. $33K a year can only go so far in this day and age no matter how much I budgeted, scrimped and saved.
Thank God for my persistence, I’ve been self-employed and financially abundant since my lead-gen business took off. I’m literally earning in 3 weeks now what I used to earn a whole year back in 2019. Sometimes I’d earn it in 2 weeks.
I tell ya, we all have a built-in bullsh** sensor deep inside us that warns us about the scammy online training programs from the real ones that can teach you evergreen moneymaking skills. I took a chance on this unique mentorship program because deep in my gut, I recognized that the concept was solid.
I turned thirty recently and I’ve solidified my financial holdings to where I’ll never lack for anything in the future. My vault is full, my retirement is taken care of. This would’ve been possible had I stuck to my 9-to-5 job that paid me peanuts.
Don’t let mediocrity be your life book. Be brave, don’t settle for a boring job like the other 95% of people and only live for the weekends.
Take a chance on a real online training program that works for you and your bank account. Sign up now.
The risks you take today dictate the way you’ll live your life tomorrow.
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