In the book Rich Dad Poor Dad by Robert T. Kiyosaki with Sharon L. Lechter the author who is also the narrator talks about how to educate yourself and your kids about money and how to control your money instead of letting it control you. The author grew up in Hawaii in a middle class family but had the chance to learn about money from his rich friend, Mike whose father in the book is referred to as his rich dad. The lessons concentrate on six major points of view that his rich dad taught him. He also compares and contrasts the advice he got from both of his fathers.
His poor dad (who is his biological father) was a very educated man but he didn’t know how to make, use and invest his money. He concentrated more on the stability of money and thought that vacations, health insurance and working for a good company is very important. In the book the author says that his rich dad told him “Study hard so you can find a good company to work for. ” Unlike what his rich dad taught him which was “Study hard so you can find a good company to buy. ” His rich father only finished 8th grade and did not continue with school but had a lot of street smarts.
The author had a hard time picking which dads advise to listen to and at the end he picked the rich dad’s advice. In the beginning of the book the author talks a lot about attitude and you’re outlook on life. He says that you need to learn how to control your money instead of letting it control you. And one of the most important things that his rich dad tells him is that don’t say “I can’t afford it” instead focus on “How can I afford it” because if you allow yourself to defeat yourself, you will not be able to move forward and your brain will stop thinking.
One of the first lessons his rich dad riches teaches him is “If you learn life’s lessons, you will do well. If not, life will just continue to push you around” and that he teaches them because when the author is a little boy, he and Mike try to find a way to make money but what they tried to do did not work out for them so they got jobs working for Mikes dad. The pay was very low so with time they got tired of getting payed so little and they approached mikes father for a raise he said that he can raise their pay or teach them life lessons they picked life lessons. And that is when the author ‘s road to success started.
In this same time the rich dad also teaches the boys about “illusion of job security” that most people think that by having a steady job with a couple of weeks of vacation and a pension plan is just enough to survive in this world, and that even if they want more they are happy and at peace with where they are now. The rich dad also teaches them about a pattern, that every person can be bought because of “human emotions named fear and greed” he tells them that with time that same fear and greed would make a person fall into a pattern and not have the chance to change.
The second lesson in the book is understanding money, or as he puts it “Financial Literacy” in this lesson he talks about how children grow up going to school learning basic skill but they never learn any financial skills. So as adults most people do not know much about money, he says that he often had people ask him for help on how to get rich and to stay that way and he has on rule for that “You must know the difference between an asset and a liability, and buy assets”. But most people don’t even know what that means or how to interpret it. He teaches you way of how to understand it and what the reader can do to get their life on track.
He teaches you about how to make your financial dreams come true instead of making them into nightmares. The next lesson that he is taught is not only taught by his rich dad it is the lesson of location, assets and how real-estate is important in any aspect of life. Most people don’t know what assets are or how to use then the author gives you different assets you can invest in and remembers what his rich dad taught him that in order to succeed you have to take risks so by investing in assets such as stocks and mutual funds you are taking a risk and/or a gamble.
Because his rich dad believed that if you love it you will work hard at it so if you love your money or your business you will always try. And how something so small as location can make or break you so whatever you are buying or opening, location is the key. He also talks about what he calls “mind you own business” but not in the literal scenes what he means by that is that you should not worry about how to get a raise or a job but what you should worry about is how to be your own boss. Later he describes how taxes came about and the difference between rich peoples and poor people’s point of view on them.
He talked about the history of U. S. A. and the fight they had against taxes and what their taxes are used for. He explained why poor people always feel that rich people should pay more taxes and why rich people fight back. The author talks about how the conflict of taxes will go on forever as long as there are rich people and poor people but he does mention one very interesting fact that in our Tax Code of the United States there are loop holes but the poor people don’t know about them mean while the rich people not only know about them they try to look for new ones and that plays a large impact on the poor people way of thinking.
In this lesson he also talks about the power of knowledge he says “with money comes great power that requires the right knowledge to keep it and make it multiple” and when I read that sentence I had to sit back and think for a minute the full meaning and understanding of it and I understood how on the dot the author is. He also tell the reader about how he started his own business and what he did to help it take of and make him rich. One thing that he believed in is what he called financial IQ. He had for main ideas of it and they were No. 1 is accounting, No. is investing, No. 3 is understanding markets and No. 4 is the law this four main benefactors play a large role in owning your own and building your own business. He also takes about talks about how the corporations that are owned by the rich spend their taxes that the make money spend as much as they can and then they get taxed from what is left which is a very small amount. There is also the idea that the rich hid their money so that no one can tax them on it also. In the next lesson is about how our life and finances are based on a game.
Everything we do with money we are playing with a game. So he invented his own type of game called CASHFLOW this game is made to see who would be the first go get out of the so called “Rat Race”. This game is also created for the people to get their own feedback and a better view of their financial understanding. He also refers back to the school system at tell us that his lessons are those of everyday life and will be very useful in the future. This lesson will also teach you again and again as do all of his lessons that