Rich Dad, Poor Dad

By Robert T. Kiyosaki

Who controls the past controls the future, who controls the present controls the past.

Self study tasks:

1. Read and translate the text.

2. Write down all the new words.

3. Write a plan of the text.

4. Put 15 questions to the text.

5. Write an abstract of the text.

6. Be ready for discussion.

Rich Dad Poor Dad is a book by Robert Kiyosaki. It advocates financial independence through investing, real estate, owning businesses, and increasing one's financial intelligence.

Personal finance author and lecturer Robert T. Kiyosaki developed his unique economic perspective from two very different influences - his two fathers. This text lays out Kiyosaki's philosophy and his relationship with money.

Summary

The book is largely based on Kiyosaki's upbringing and education in Hawaii. It highlights the different attitudes to money, work and life of two men (i.e. his titular "rich dad" and "poor dad"), and how they in turn influenced key decisions in Kiyosaki's life.

Among some of the book's topics are:

• Robert Kiyosaki's personal story

• The difference between assets and liabilities

• What the rich teach their kids about money that the poor and middle class do not

• The idea that your house is not an asset, unless you are using it to produce revenue

• The value of financial intelligence and financial literacy

• How corporations spend first, then pay taxes, while individuals must pay taxes first

• How corporations are artificial entities that anyone can use, but the poor usually do not know how

• The importance of investing and entrepreneurship

Kiyosaki advocated Dr. Buckminster Fuller's views on wealth, that wealth is measured by the number of days the income from your assets can sustain you, and financial independence is achieved when your monthly income from assets exceeds your monthly expenses.

Definition of assets

One statement made throughout the book was the cause of both criticism and praise in the media. In the book, Kiyosaki claims that an individual's house is not an asset, although bank permits people to enlist it as such. In fact, a house is a liability. His definition of assets and liabilities are somewhat simplistic, and are written as such: "During hard times assets feed you, and liabilities eat you". Kiyosaki was indicating that liabilities are, by definition: "anything that takes money out of your pocket"; while assets, are "properties that bring money into your pocket." Therefore a house that costs you money is a liability, and a rental property that produces positive cash flow income is considered to be an asset. A profitable business is also an asset, while a business that loses money is considered a liability.^[8]

Rich Dad Poor Dad by Robert Kiyosaki, a Book Review

Rich Dad Poor Dad, written by Robert Kiyosaki, is an educational story of a boy growing up with two fathers; his biological father and his good friend's father that

treated him as his own son. 

The biological dad was the one that he considers his Poor Dad, while his good friend's father is the one which is said to be the Rich Dad. The poor dad is compared to other poor dads all over the world that encourage their children to achieve success in school and to be able to find a good job later as an adult. On the other hand, his Rich Dad recommends him master the power and knowledge of investing. With the advantage of having 2 fathers with such different perspectives, he was able to compare both and also develop his own perspective.  All through Rich Dad Poor Dad, Robert Kiyosaki discovered 6 crucial lessons: 

The Rich Do Not Work For Money. Within this part of the narrative, Robert Kiyosaki learns to take risk. The majority of people do not learn this and wind up playing it safe for the majority of their life and therefore are never ın a position to financially succeed. His Rich Dad shows him that poor people are afraid, so they work for money and security, but don't realize the opportunities which lay right in-

front of their face. 

The Importance of Financial Literacy. With this lesson, Robert Kiyosaki is older and learns through the misfortune of other people that you have to have financial literacy to stay safe. He finds that the primary reason for monetary difficulty is not understanding the difference between assets and liabilities. Which is why many people have difficulties staying wealthy, after they get rich. Kiyosaki’s Rich Dad tells him basically, "An asset is something that puts cash in my wallet, and a liability is something that takes cash out of my pocket. In order to be rich, just spend your lifetime obtaining assets. If you want to be poor or middle class, spend

your life obtaining liabilities. Minding Your Own Business. In this lesson, Robert Kiyosaki learns from his Rich Dad that if you want to become financial self sufficient you have to discover a way to become your own boss and worry about your own business. He discovers from his Poor Dad that the major reason for economic struggle is spending all your

life doing work for some other person.  Taxes and Corporations. Robert Kiyosaki’s Rich Dad taught him that wealthy folks do not let themselves be run over by corporations, instead they normally use the large corporations safeguard their money and assets. He learned that he can help himself by taking lessons about marketing and advertising, investments,

accounting, and many others. The Rich Invent Money. The key point Kiyosaki learns from his Rich Dad throughout this lesson is you must create your own luck. You cannot just sit around and wait for the perfect opportunity to show up! It will not take place if you do not put effort into it. During this lesson “fear” once more comes into play. According to Kiyosaki’s Rich Dad, it isn't the well educated folks that become rich, but it is the people prepared to take a risk and make it happen. Work to Learn, Do Not Work For Money. Kiyosaki discovered that the rich don't work for money, they work for knowledge and skill. When you devote time and effort running after a dollar, you will find it to be an illusive goal. If on the other hand, you chase wisdom and knowledge, the money will naturally follow.  Robert Kiyosaki sums up his account of Rich Dad Poor Dad with the 5 primary obstacles that restrict financial growth.

• Fear

• Cynicism

• Laziness

• Bad habits

• Arrogance

Overall, this book is a great read. It will help you to build a solid foundational base to have a long and profitable entrepreneurial career. I would highly recommend this book as a primer to your business education and a must read for anyone that wants to build wealth and financial independence.