Book Summary #6: Rich Dad Poor Dad by Robert Kiosaki

Enduring Takeaways

Robert Kiyosaki is a Japanese-American entrepreneur, businessman, author, and the founder of Rich Global LLC and the Rich Dad Company. I decided to read his book after listening to Robert Kiyosaki On Money, Personal Finance & More | TRS 337, published on Sept 5, 2023. I completed the book in next 3 days!

In this episode, he shared some brutal truths about our education system and how we are unaware of the actual knowledge that will make us money in the future. He also dwelled upon his military training phase and the future of jobs with the introduction of Artificial Intelligence.

About the book

“Rich Dad Poor Dad” is a personal finance classic written by Robert Kiyosaki. It presents the author’s financial education through the contrasting philosophies and practices of two father figures in his life: his “Poor Dad” (his biological father) and his “Rich Dad” (his best friend’s father). This book is a valuable resource for anyone looking to improve their financial literacy and make better financial decisions.

What stayed with me?

These are the exact words from the author that left a strong impression on me, chapter by chapter.

1. Rich Dad, Poor Dad

The way we think about money significantly influences our financial success.

• “The only one who can teach you to be rich is yourself.”
• “In the real world, the smartest people are people who make mistakes and learn. In school, the smartest people don’t make mistakes.”
• “It’s not how much money you make, but how much money you keep, how hard it works for you, and how many generations you keep it for.”

2. The Rich Don’t Work for Money

Focus on acquiring income-generating assets, not just working for a paycheck.

• “The poor and the middle class work for money. The rich have money work for them.”
• “The poor and the middle class avoid risk because they believe that a job is a safer way to earn a living.”
• “People’s lives are forever controlled by two emotions: fear and greed.”
• “If you don’t first handle fear and desire, and you get rich, you’ll only be a high-paid slave.”

3. Why Teach Financial Literacy?

Financial education is more valuable than formal education for building wealth.

• “The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth.”
• “The love of a job is a little more secure than the love of money.”
• “Formal education will make you a living; self-education will make you a fortune.”
• “Money without financial intelligence is money soon gone.”

4. Mind Your Own Business

Building and owning your own income-generating assets is a path to financial freedom.

• “Jobs are a short-term solution to a long-term problem.”
• “The problem with having a job is that it gets in the way of getting rich.”
• “Financial struggle is often the result of people working all their lives for someone else.”
• “If you think I’m the problem, then you have to change me. If you realize that you’re the problem, then you can change yourself, learn something and grow wiser. Most people want everyone else in the world to change themselves. Let me tell you, it’s easier to change yourself than everyone else.”
• “The lack of money is the root of all evil.”
• “The richest people in the world look for and build networks, while everyone else looks for work.”
• “The most important work is not the business, but the building of the business.”
• “The most successful people in life are the ones who ask questions. They’re always learning. They’re always growing. They’re always pushing.”

5. The History of Taxes and the Power of Corporations

Tax knowledge and corporate structures can can reduce financial burdens and grow your wealth.

• “The rich buy assets. The poor only have expenses. The middle class buy liabilities they think are assets.”
• “The more you learn, the more you earn.”
• “One of the great lessons I learned from my rich dad was to find out what you are worth.”
• “The primary reason the rich get richer is not because of greed, but because they know the power of money is not in the consuming, but in the investing.”
• “In the world of money, the business of the business is the best business of all.”

6. The Rich Invent Money

Be creative and open-minded in finding new income sources.

• “The world is full of talented poor people.”
• “The moment you make passive income and portfolio income a part of your life, your life will change.”
• “The primary difference between a rich person and a poor person is how they manage fear.”
• “There is gold everywhere. Most people are not trained to see it.”

7. Work to Learn - Don’t Work for Money

Invest in self-education and skills to increase your earning potential.

• “Don’t let the fear of losing be greater than the excitement of winning.”
• “The key to life is to be happy with or without money.”
• “I find so many people struggling, often working harder, simply because they cling to old ideas. They want things to be the way they were; they resist change.”
• “I have never met a rich person who has never lost money. But I have met a lot of poor people who have never lost a dime.”

8. Overcoming Obstacles

Change your mindset and take responsibility for your financial future.

• “The fear of being different prevents most people from seeking new ways to solve their problems.”
• “Winners are not afraid of losing. But losers are. Failure is part of the process of success.”
• “The more a person seeks security, the more that person gives up control over his life.”

9. Getting Started

Start small and take the first steps towards financial independence.

• “The biggest challenge you have is to challenge your own self-doubt and your laziness.”
• “Don’t be addicted to money. Work to learn. Don’t work for money.”
• “People without financial knowledge, who take advice from financial experts, are like lemmings simply following their leader.”

10. Still Want More? Here Are Some To Do’s

This chapter discussed about steps to work towards your financial goals.

• “There are no bad business and investment opportunities; there are just bad entrepreneurs and investors.”
• “The key to financial freedom and great wealth is a person’s ability or skill to convert earned income into passive income and/or portfolio income.”
• “The power of our thoughts is capable of producing wealth and, once earned, wealth like any form of power is capable of duplication.”
• “In today’s fast-changing world, it’s not so much what you know anymore that counts, because often what you know is old. It is how fast you learn.”

11. Final Thoughts

Financial freedom is attainable by changing your mindset and taking control of your financial future.

• “There is a difference between being poor and being broke. Broke is temporary. Poor is eternal.”
• “The most life-destroying word of all is the word tomorrow.”
• “It’s not what you say out of your mouth that determines your life. It’s what you whisper to yourself that has the most power.”

“Rich Dad Poor Dad” challenges conventional wisdom about money and offers a unique perspective on building wealth. It emphasizes financial education, asset acquisition, and entrepreneurial thinking as keys to financial success. By implementing these principles, one can work towards achieving financial independence and a more prosperous future.

Happy to connect with individuals who hold opposing views about this book. Drop an email to krisakshi3@gmail.com or ping me on Instagram at sakshikumari204.