Robert Kiyosaki – Rich Dad, Poor Dad Book Review

One of the best books I've come across on financial education has been Rich Dad, Poor Dad by Robert Kiyosaki.  I've since become a huge fan of Robert Kiyosaki and have read many of his other books and watched a lot of videos of him.  In this book review, I want to share some of the most important lessons that I've learned from Rich Dad, Poor Dad.

Become Financially Educated

This is one of the biggest things I've taken from Robert Kiyosaki.  He says most people spend years in school but learn nothing about money or finances.  He stresses how money is something learned at home and is usually taught by your parents, not through the school or education system.  We all need to take it upon us to become financially educated and literate.

One of the reasons the rich get richer, the poor get poorer, and the middle class struggles in debt is because the subject of money is taught at home, not in school.  Most of us learn about money from our parents.  So what can a poor parent tell their child about money?  They simply say “Stay in school and study hard.”  The child may graduate with excellent grades but with a poor person's financial programming and mind-set.  It was learned while the child was young.

Money is not taught in schools.  Schools focus on scholastic and professional skills, but not on financial skills.  This explains how smart bankers, doctor and accountants who earned excellent grades in school may still struggle financially all of their lives.

One of my favorite segments of the book is when he talks about learning as much as possible and developing your skill sets in different areas.  To learn areas such as sales, marketing, communication, management, etc… and how valuable they are.

He tells a story about how he was interviewed in Japan by a woman.  This woman was an extremely talented writer and had written many novels, however, none of them had cracked the best-seller list.  When Robert was talking to her, he asked her why doesn't she learn sales?  She says “Oh, I hate sales.  I don't want to be one of those people” and she goes on and on.

Robert Kiyosaki said, “There's a reason why I'm a best-selling author instead of a best-written author.”

The lesson from that is to learn to sell.  Sales is a valuable asset and will get you far.  You could write the best book in the world, but if you can't sell it, then what's the point?  This is something I can definitely relate to, as I publish a lot of books on Kindle and it all comes down to the marketing of the books.

Have Money Work For You

Most people WORK FOR MONEY, instead of having money WORK FOR THEM.

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

Most people spend their lives going through school and getting an education so that they can WORK FOR MONEY.  They spend all their time working for someone else.  For example, they work for a paycheck and are making the owner/shareholders richer.  Then they work for the government, which takes its share from their paycheck before they even see it.  And of course, the harder they work and more money they make, the more of it is taken from the government.  And finally, they work for the bank to pay off their mortgage and credit card debt.

Instead, acquiring assets that produce income is a way of having money work for you.  Examples are passive income (real estate), portfolio income (stocks, bonds, etc…), or businesses.  Part of the reason why I'm so big into online marketing is that I've been able to create automated streams of income through it.  Check out my blog post on how to make passive income.

Acquire Assets, Not Liabilities

Robert says we must know the difference between an asset and a liability, and buy assets.

Rich people acquire assets.  The poor and middle class acquire liabilities, but they think they are assets.

Here are more examples of assets that Robert Kiyosaki recommends we acquire:

• Businesses that do not require your presence.
• Stocks
• Bonds
• Mutual Funds
• Income-generating real estate
• Notes (IOU's)
• Anything that produces income or appreciates or has value.

A liability is anything that is an expense or depreciates in value.

Own a Corporation 

Another great thing Robert talks about is the tax advantages of owning a business.  He mentions how a corporation can do so many things that an individual cannot.  Like pay for expenses before it pays taxes.

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.

A fantastic summary he has for it is:

The Rich with Corporations

1. Earn
2. Spend
3. Pay Taxes

People Who Work for Corporations

1. Earn
2. Pay Taxes
3. Spend

In this book, there are tons of other nuggets of gold like the ones I mentioned above.  Everything I covered here is just the tip of the iceberg.  I hope you enjoyed this Rich Dad, Poor Dad review and take the next step to further your financial education.

To find out more about Rich Dad, Poor Dad by Robert Kiyosaki, click here.