Key Ideas From the book "Rich Dad, Poor Dad"

RICH DAD , POOR DAD

What the rich people teach their kids about money that the poor and middle class do not!
By Robert Kiyosaki and Sharon Lechter

In my last post, I shared the main ideas from the book "The Richest Man In Babylon" and I said that what led me to read this book in the first place was a recommendation given by Robert Kiyosaki in his book (Rich Dad, Poor Dad), Now I find it fair to also share with you key ideas from "Rich Dad, Poor Dad" and I hope to influence you to read it, if you haven't read it yet.

Introduction

It’s what’s in your head that ultimately ends up determining what’s in your hands.

Therefore, if you want more money, change the way you think. That will automatically change the way you act, which in turn will impact on the results you achieve. It all starts in the mind, successful people invariably start small and build from there. The same applies to every area of making money. The key is not how big you are when you get going, it’s the ideas that you’re harnessing. Take the time to find the best ideas and you can ride it all the way to whatever level of financial achievement you decide upon. Nobody else chooses for you, it always comes down to what you decide. Above all, educate yourself. Develop financial intelligence. Spend time with successful people. read books, attend seminars and learn how to make money work for you. Your life will be more rewarding and more fulfilling if you just take the time to learn and think about where you’re heading.

The path to financial wealth doesn’t lie in playing it safe. It’s far more important to play it smart.

Key Ideas:

Idea 1: Instead of working for money, create ways to make money work for you.

‘‘ Most people have a price. And they have a price because of human emotions named fear and desire. First, the fear of being without money motivates us to work hard, and then once we get that paycheck, greed or desire starts us thinking about all the wonderful things money can buy. The pattern of get up, go to work, pay bills, get up, go to work, pay bills is then set. Their lives are then run forever by two emotions, fear and greed. Offer them more money, and they continue the cycle by also increasing their spending. This is what I call the Rat Race.’’ -- Robert Kiyosaki and Sharon Lechter

Idea 2: Teach financial literacy so that you can distinguish between an asset and a liability, and buy assets.

In life, it’s not really how much money you make that counts but how much you keep, and how many generations you keep it. To achieve that takes financial literacy.

The foundation of financial literacy is to know the difference between an asset and a liability, and buy assets. The rich build and acquire assets. The middle class and the poor acquire liabilities in the mistaken belief they are assets.

• An asset is anything that puts money into your pocket.
• A liability is anything that takes money out of your pocket.

Idea 3: Take the time to invest in and build your own business as the foundation of your financial health.

‘‘I love stocks of small companies, especially start-ups. The reason is I am an entrepreneur, not a corporate person. I like starting companies, not running them. So my stock buys are usually of small companies, and sometimes I even start the company and take it public. Fortunes are made in new-stock issues, and I love the game. Many people are afraid of small-cap companies and call them risky, and they are. But risk is always diminished if you love what the investment is, understand it and know the game.’’ -- Robert Kiyosaki and Sharon Lechter

Idea 4: As part of your financial strategy, form a corporation to own the assets you are accumulating.

‘‘The idea that it takes money to make money is the thinking of financially unsophisticated people. It does not mean that they’re not intelligent. They have simply not learned the science of making money. Money is only an idea. If you want more money simply change your thinking. Every self-made person started small with an idea, then turned it into something big.’’ -- Robert Kiyosaki and Sharon Lechter

Idea 5: Use the skills of financial intelligence to create ongoing, profitable business opportunities.

The main benefit of developing financial intelligence is that it
gives you more options, more opportunities to develop creative
solutions to your financial requirements than the standard issue
‘‘Work hard, save some money on a regular basis’’ strategy most
people adhere to religiously.

‘The point I would like to make is that investments come and go, the market goes up and down, economies improve and crash. The world is always handing you opportunities of a lifetime, every day of your life, but all too often we fail to see them. But they are there. And the more the world changes and the more technology changes, the more opportunities there will be to allow you and your family to be financially secure for generations to come. But great opportunities are not seen with your eyes -- they are seen with your mind.’’ -- Robert Kiyosaki and Sharon Lechter

Idea 6: Whenever you have to work for someone else, do it to learn something new, not just for the money.

The smart approach to working is to select a job that will teach you something you don’t already know rather than on the basis of what you will earn.

‘‘If you have any desire of being rich, you must focus. Put a lot of your eggs in a few baskets. Do not do what poor and middle-class people do: put their few eggs in many baskets. Balanced people go nowhere. They stay in one spot. To make progress, you must first go unbalanced. Thomas Edison was not balanced. He was focused. Bill Gates was not balanced. He was focused. Donald Trump is focused. George Soros is focused. George Patton did not take his tanks wide. He focused them and blew through the weak spots in the German line. The French went wide with the Maginot Line, and you know what happened to them.’’ -- Robert Kiyosaki and Sharon Lechter

Idea 7: To achieve financial success, you have to be prepared to overcome the obstacles and roadblocks you’ll face.

The five main reasons people fail to develop abundant assets are:

1. They have a fear of losing rather than making money.
2. They are cynical and don’t believe it can be done.
3. They are too lazy to change their habits.
4. They let their habits control their behavior.
5. They’re arrogant - a combination of ego and ignorance.

‘‘To find million-dollar "deals of a lifetime" requires us to call on our financial genius. I believe that each of us has a financial genius within us. The problem is, our financial genius lies asleep, waiting to be called upon. It lies asleep because our culture has educated us into believing that the love of money is the root of all evil. It has encouraged us to learn a profession so we can work for money but failed to teach us how to make money work for us. Unfortunately, 90-percent of the Western world subscribes to the above dogma, simply because it’s easier to find a job and work for money.’’ -- Robert Kiyosaki and Sharon Lechter

Idea 8: To arrive at your ultimate goal of financial success, you first need to get started.

To awaken the financial genius within you and start on the
journey to financial freedom, try these steps:

1. Find an emotional reason to start the journey.
2. Reinforce that decision on a daily basis.
3. Choose your friends carefully.
4. Continue learning until you master it; then learn new ideas.
5. Develop the self discipline to pay yourself first.
6. Pay well for good advice from professional advisers.
7. Find ways to make your investments freehold.
8. Use your assets to pay for luxuries, not your capital.
9. Develop some financial heroes -- high achievers.
10. Make the time to teach others what you learn.
    
    

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RICH DAD , POOR DAD, Robert Kiyosaki and Sharon Lechter

‘‘Always remember to have fun. This is only a game. Sometimes you win and sometimes you learn. But have fun. Most people never win because they’re afraid of losing. That is why I found school so silly. In school we learn 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. The same is true for learning to ride a bike. I still have scars on my knees, but today I can ride without thinking. The same is true for getting rich. Unfortunately, the main reason most people are not rich is that they are terrified of losing. Winners are not afraid of losing. But losers are. Failure is part of the process of success. People who avoid failure also avoid success.’’ -- Robert Kiyosaki and Sharon Lechter

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Want to Explore more those ideas?

If you are interested in this kind of topic let me know so I can keep writing more related posts, explore and share more details on each of those ideas, I hope you enjoyed, if yes, you already know all the ways you can show this.

Written with love by @davidfumo

May The Force Be with You!