Rich Dad, Poor Dad

“infobox Book “

name	Rich Dad, Poor Dad
image
author	Robert Kiyosaki
country	United States
language	English
genre	Novel
publisher	Time Warner Books UK
release date	April 1, 2000
media type	Hardback & Paperback
pages	207
isbn	0446677450

The book is the fib of a person ( the narrator and writer ) who has two fathers : the beginning was his biological church father – the poor dad – and the other was the don of his childhood best friend, Mike – the rich dad. Both fathers taught the generator how to achieve success but with very disparate approaches. It became apparent to the author which forefather ‘s approach made more fiscal sense. Throughout the book, the generator compares both fathers – their principles, ideas, fiscal practices, and degree of vigor and how his actual forefather, the poor and struggling but highly educated homo, paled against his full-bodied dad in terms of asset construction and business acumen. The writer compares his poor dad to those people who are perpetually scampering in the Rat Race, helplessly trapped in a condemnable cycle of needing more but never able to satisfy their dreams for wealth because of one glaring miss : fiscal literacy. They spend so much time in school learning about the problems of the world, but have not acquired any valuable lessons about money, simply because it is never taught in school. His rich dad, by contrast, represents the independently affluent core of society who intentionally takes advantage of the world power of corporations and their personal cognition of tax and report ( or that of their fiscal advisers ) which they manipulate to their advantage.

The script ’ second theme reduces to two cardinal concepts : a can-do position and audacious entrepreneurship. The writer highlights these two concepts by providing multiple examples for each and focusing on the need for fiscal literacy, how the exponent of corporations contribute to making the affluent even wealthier, minding your own occupation, overcoming obstacles by not fostering sloth, fear, cynicism and other negative attitudes, and recognizing the characteristics of humans and how their preconceive notions and upbringing hamper their fiscal exemption goals. The generator presents six major lessons which he discusses throughout the record :

• The rich don’t work for money
• The importance of financial literacy
• Minding your own business
• Taxes and corporations
• The rich invent money
• The need to work to learn and not to work for money

Character Summaries

rich Dad, Poor Dad revolves around three main characters : poor dad, rich dad ( Kiyosaki ’ s moment father ) and the son ( the writer himself as narrator of the script ). The perfume of each character is :

• Poor dad – educated but lacking the street smarts
• Rich dad – very little education (eighth grade), tons of street smarts
• Kiyosaki – the spectator who learns lessons from both but internalizes only rich dad’s traits

Poor Dad

The author compares his inadequate dad to the millions of fathers who encourage their sons to do well in school so they could get a good job with a good company. Poor dad believed in the traditional principles of working hard, saving money, and not buying material things that one can not afford. He believed that having a good job with a solid company is what one should aspire for ; therefore he expresses disappointment when his son leaves the employment of a bombastic, reputable pot. Poor dad looks to education as the pass to success. He held a doctor’s degree degree, went to Ivy League universities, but was constantly struggling financially. He believed he would never be a fat man and the writer points out that this became a self-fulfilling prophecy. Poor dad was more interested in a good education than the national of money. The generator wrote that his poor people dad would constantly say things like, “ I ’ molarity not concerned in money ” or “ money doesn ’ thymine matter. ” The generator points out that poor dad was preoccupied with things like job tenure and security, Social Security, vacation and brainsick leaves, ship’s company indemnity and wage raises and promotions. The writer felt that his poor dad was more interest in these factors preferably than on the speculate itself. This is what the author calls being trapped in the Rat Race. His poor dad worked hard endlessly but somehow never made it ahead financially. Poor dad ’ s approach to the subject of money was based on working hard to have enough money to pay the bills ( in contrast to rich dad ’ s approach to make one ’ s money work for him ) .

Rich Dad

The author wrote that it was when he was nine years erstwhile that he started realizing that his full-bodied dad made much more common sense than his poor dad. It was from deep dad that the author learned not to say, “ I can ’ deoxythymidine monophosphate yield it ”, but alternatively to ask, “ how can I afford it ? ” He explains this principle by relating an incident when he and his best ally Mike went to work for Mike ’ s beget. full-bodied dad paid them very first gear wages measuredly so that would stir wrath and a sense of injustice in them and finally for them to realize that in regulate to get ahead, one must work for himself and not for others. For exercise, in that part of the script when the generator complains to rich dad that he can barely afford to buy anything with the wages he is paid, rich dad tells him that he shouldn ’ thymine populate on the fact that his wages are broken, but rather ask “ how can I make more money ” because this stimulates the brain to take action. His deep dad says that when person says, “ I can ’ t afford it ”, his brain stops working. It consequently kills inaugural and promotes passivity. The writer adds that while his inadequate dad invested time and attempt in education, he did not have any cognition on investing. His rich dad, by contrast, was very skilled in the investing game because that ’ s all he did. The position of his rich dad about money was manifested in the saying “ the lack of money is the root of all evil ” ( his poor people dad, on the early hand, believed that the sexual love of money is the root of all evil ). According to the writer, fat dad besides nurtured the estimate that taxes punished producers and rewarded the non-producers. He was the type who encouraged money talk at the dinner board and was portrayed by the author as person who learned to manage gamble, rather of not taking risks .

The Son (Robert T. Kiyosaki)

The writer begins his book, Rich Dad, Poor Dad, by saying that he is fortunate in having had two fathers. He learned valuable lessons from both of them, but in Chapter One it becomes apparent which father had the more reasonable overture towards money. He compares and contrasts both fathers ’ views about working intemperate, getting an education, saving and investing and realizing how habits of the rich and poor significantly differ. He attributes his fiscal acumen through the many conversations he carried out with his rich dad. The author takes a common sense approach to the subject of money and emphasizes the indigence for accounting cognition so that the lector clearly understands what assets and liabilities are. He makes simple diagrams that show the inflow and outflow of money and how the rich construct up the asset column and the inadequate build up the liability column ( expenses ). It is obvious that the author places much importance on account cognition – no matter how boring it is – because he says it is “ the most important discipline in your biography. ” By using numerous examples and anecdotes, the writer drives home his messages effectively, revealing his pro-capitalist stance. The writer besides shows his sympathy of the mechanisms employed by the politics and the tax man and concludes that it is the middle class that actually pay for the poor. The rich are the ones who are barely taxed because they have the cognition to use tax legislation to their advantage .

Chapter Summaries

Chapter One: Rich Dad, Poor Dad

The floor of Robert Kiyosaki and Mike starts in 1956 Hawaii, when both boys were a nine years old. Their first get-rich dodge was a counterfeit nickel making caller. They made plaster molds of the nickels and melted leash toothpaste tubes and filled the molds to produce the nickels. Their design was foiled by Mike ‘s founder, who informed the boys of their illegal activeness. After that day, the boys dedicated their detached time to leaning about finance and economics from Mike ’ second father, the rich dad. The beginning example Mike ’ sulfur dad made the boys have was hatred of the “ Rat Race ”. He was able to achieve this by making the male child work in one of his grocery store stores for three hours for ten-spot cents an hour pay. Within a few weeks, Kiyosaki, tired of being exploited for parturiency, demanded that he receive a promote, but rather, Mike ’ s church father cut his pay and told him to work for free. finally, both boys tired of being under appreciated ( and unpaid ) and they met individually with Mike ‘s father. In their meetings with rich dad, he apologized for lack of pay and he offered them either the moral of the moral or a pay raise. Both boys chose to learn the moral of the example, while deep dad offered them pay raises. He started at twenty-five cents, a dollar, two dollars, and even five dollars, which would have been considered a large come of money for an hourly engage, but the boys even remained strong with their decision to learn the moral of the moral. The example to get out of the “ Rat Race ” and rather of spending your unharmed life working to put a small money in your pouch and a bunch of money in person else ’ randomness air pocket, have people work hard to put money in your pouch. Out of all the lessons that were taught to the boys, this one was the most authoritative. ( Kiyosaki and Lechter 28-35 )

Chapter Two: The Rich Don’t Work for Money

The generator tells his readers to forget the impression that life teaches. He says “ the only thing that life does is push you about. ” This chapter talks about people who are more comfortable in playing it safe because they were not taught early to take risks. The author develops the ideas that the inadequate and the middle class oeuvre for money, concern and greed induce ignorance and poverty, and the importance of using one ’ south emotions versus thinking with emotions. The generator besides stresses that opportunities in liveliness come and go ; the rich people recognize them instantaneously and turn them into amber bullions. Others do not see these opportunities because they ’ re besides busy seeking money and security. As the author says, well “ that ’ s all they ’ re going to get. ”

Chapter Three: Why Teach Financial Literacy

The narrative of Kiyosaki and Mike continues belated in life, 1990, and both of the now adults have made incredible leaps and bounds with regards to their finances and their socioeconomic status. Mike was able to take the example from his church father and apply them to his animation. He took control of his father ’ south large business and increased every aspect of the empire and he is presently raising his son to take control of the company once he retires. As for Kiyosaki, he was able to retire at the historic period of 47 with his wife Kim. At a business meeting at the Edgewater Beach Hotel in Chicago, Charles Schwab, Samuel Insull, Howard Hopson, Ivar Kreuger, Leon Frazier, Richard Whitney, Arthur Cotton, Jesse Livermore and Albert Fall met to talk about different investments and money schemes. Twenty-five years by and by, a reputation stated that a large majority of those highly affluent people that met in Chicago either ended up in jail, dead or hard up. The major idea to take from the results of these unfortunate entrepreneurs is that you need fiscal literacy to be and stay dependable. The mind that was represented with the boastful 1920 ’ s entrepreneur is silent prevailing nowadays with some of the professional athletes making hapless fiscal decisions and ending up with following to nothing. This specific lesson is meant to teach people not to be knowing with your money once you have it, but rather be smart with your money before you have it. In a way, don ’ metric ton try on to build a skyscraper or even a theater without building a hard foundation first. According to Kiyosaki, there is one rule, and only rule that can help a person to build a strong foundation ; know the dispute between an asset and a indebtedness, and make sure that you merely control assets. ( Kiyosaki and Lechter 56 ) When it comes to beliefs about money bribe exemption and the ability to enjoy retirement without fear of outliving one ’ mho money, this chapter catches the perfume of the generator ’ s advocacy for fiscal independence. He says, “ Intelligence solves problems and produces money. money without fiscal news is money soon gone. ”

The generator believes that fiscal literacy begins with a working cognition of accounting. It is substantive to know the dispute between assets and liabilities. To make these two terms apprehensible to readers, the writer makes a vestigial diagram of these two concepts to motivate them to purchase assets in club to solidify the asset column, while keeping the liabilities ( expenses ) to a bare minimal. The author states that hapless people remain poor people because they do the inverse. They pile up on their liabilities and have zero assets so that their balance sheets and income statements look out of kilter. People have to understand that it ’ s not how much they make, but how much they keep according to the author, and this is an all-important principle that this chapter focuses on .

Chapter Four: Mind Your Own Business

In this chapter, the generator slowly introduces the concept of very estate of the realm investing and uses McDonald ’ south as an exercise. He points out that McDonald ’ randomness may not make the best hamburgers in the world, but owns the “ most valuable intersections and streets in America. ” The author remarks that individuals need to mind their own business if they wish to become financially self-sufficient. They shouldn ’ thyroxine mind their employer ’ randomness business, they should strive for ways to become their own bos and nurture their own businesses. The author continues his discussion on construction assets. To him, real number assets are anything with value – stocks, bonds, common funds, income-producing substantial estate, notes, royalties from cerebral property, etc. This chapter besides reveals the generator ’ randomness investing preferences : substantial estate of the realm and stocks. For very estate of the realm, he says he starts small, and trades his properties for bigger ones and then delays paying taxes on capital gains through one IRS mechanism .

Chapter Five: The History of Taxes and the Power of Corporations

The writer states that the poor let the big machinery ( corporations ) manipulate them whereas the deep know how to use big machinery. This means that the fat posse the cognition and savoir faire to use the baron of the corporation to protect and enhance their assets. The advantage of a corporation versus that of the person lies in how corporations pay taxes, according to the generator. He makes this point distinctly : individuals earn money, pay taxes on that money, and live with what ’ randomness left. The corporation, on the other hand, earns money, spends everything it can, and is taxed on anything that ’ second left. The author adds that individuals may not be mindful of how much they ’ rhenium being manipulated ; they work from January to mid-May to enrich the government by paying taxes on their income. In the interim, the full-bodied are barely taxed. The author recommends developing one ’ s fiscal IQ as one way of leaving the commonplace of casual universe. This is accomplished by gaining cognition of accounting, investing, understanding the markets, and the law. He says being ignorant gets you bullied whereas being informed translates into “ you have a contend find. ”

Chapter Six: The Rich Invent Money

The author develops the concept of diffidence. He says that each person is born with talent but that endowment is suppressed because of diffidence and fear. He remarks that it ’ s not necessarily the educated smart people who get ahead but the bold and adventurous. People never get ahead financially even if they have plenty of money because they have opportunities that they fail to tap, he stresses. Most of them just sit around waiting for opportunity to happen. The writer ’ sulfur idea is that people create luck ; they should not wait around for it. He says it ’ s the lapp with money. It has to be created. In this chapter, the writer discusses the importance of an education ( although some critics say that he appears to downplay its importance ). The writer is clear by saying, “ a train mind is a ample mind. ” In his analysis, there are two types of investors, each with a different heed typeset : those who go for the packaged investment, and those who customize investments to suit their objectives. The generator encourages people to hire people more intelligent than they because by capitalizing on the cognition of others, an healthy individual builds his own cognition base and consequently has more ability over those who don ’ thyroxine know .

Chapter Seven: Work to Learn, Don’t Work for Money

This is the chapter where the author talks about the skills individuals need to develop for fiscal achiever. The lector is given an model of a new charwoman who had a Master ’ s Degree in English Literature and who was offended when it was suggested that she learn to sell and do direct market. After all the hard work for her academic degree, she didn ’ t think she would have to stoop therefore low to learn how to be a salesperson, a profession she didn ’ thyroxine think very highly of. The author uses this model to emphasize that there are other skills people need to cultivate to help them on the road towards fiscal freedom. The writer mentions management skills. He says individuals need to know how to manage cash run, systems, and people. To that he throws in selling and marketing skills. He puts equal vehemence on communication skills. He says there are many people who have the scientific bent and hence have a powerhouse of cognition, but they fail miserably in communications. These are the people who are “ one skill away from great wealth. ” The writer calls attention to one outstanding trait of great affluent families : they give money away – plenty of it – unlike the poor people who feel that charity begins at family .

Chapter Eight: Overcoming Obstacles

The opinion of the writer is that five personality traits hamper human beings : concern, cynicism, sloth, bad habits, arrogance. He explains that while it ’ second normal to have fear, what matters is how one handles it. The writer shares his opinion about his especial affection for Texas and Texans : “ When they win, they win big and when they lose, it ’ s outstanding. ” The generator maintains that it ’ s not merely a question of balance but besides FOCUS. He recommends that the Chicken Littles of the global be ignored. They ’ re only concerned about the sky falling, spending the rest of their lives in pessimism. He says he constantly hears people saying they want to be rich, but when it ’ south suggested that money can be made from real estate, their initial reaction is “ but I don ’ thyroxine want to fix toilets. ” The generator believes it ’ s dry that they ’ re more concerned about trivium like fixing toilets rather than what lies ahead in real estate. As a final period, the writer states that it is healthy to be greedy, indeed when faced with a decisiveness, a person must always ask, “ What ’ mho in it for me ? ”

Chapter Nine: Getting Started

This chapter serves as a section on tips to create and build personal wealth. His first tip is, find a cause greater than reality to motivate you. What he means by this is to wake up the fiscal flair in oneself by empowering the mind. He says that people must have a firm /purpose for living. The next tip is to feed the mind. By feeding the mind, the generator contends that people acquire power of choice. The author besides advises people to choose friends carefully. He says to avoid people who proclaim endlessly that the sky is falling and rather encourages readers to spend clock time with people who enjoy talking about money because they may have valuable lessons to share. The author besides believes that people should study one playing field, and then go out and learn a modern one, although it is crucial to choose what one studies. hera is another topple that the generator observes most people don ’ metric ton practice : pay yourself first. even if short of cash, people must pay themselves first. This goes in bicycle-built-for-two with managing three things efficiently : cash flow, people and personal clock. Another tip the generator gives is being generous. He thinks it makes a fortune of sense to pay one ’ randomness broker well as he ’ s an ally, and “ your eyes and ears to the market. ” The generator suggests having heroes. They are essential in life because they not only cheer, they besides make it seem sol easy. They stimulate the human mind into think, “ If they can do it, why can ’ triiodothyronine I ? ” “ Teach and you shall receive ” is another tip that the author shares. His words are eloquent concerning this estimate : “ There are powers in this world that are much smarter than we are. You can get there on your own, but it ’ s easier with the help of the powers that be. All you need to be is generous with what you have, and the powers will be generous with you. ”

Chapter Ten: Still Want More? Here are Some To Do’s

This chapter is sort of a addendum to the previous chapter. It gives readers extra tips to help them reach for fiscal rewards. One tiptoe is to stop doing what you ’ re doing – that is, if it ’ mho no longer working or viable. The generator encourages readers to look for new ideas, to pick the brains of individuals who have the have and who have already done what one aspires to do. He advises on keeping the learn wind alive, taking courses, buying tapes, attending seminars. In looking for veridical estate investment opportunities, the author recommends looking in the right places. One manner of doing this is to jog around the neighborhood one is concern in. People can acquire real number estate even if they don ’ t have sufficient funds for the polish payment. In fact, with a bit of ingenuity, the generator says people can even make money with no capital .

Themes in Rich Dad, Poor Dad

One root that ’ randomness apparent in this ledger is that for an individual to be affluent, he must aim to own the organization or means of product, rather than work for another individual. The author stresses that there is obviously something confining about being an employee ; it shuts the judgment to other possibilities and it stunts inaugural. fiscal intelligence is THE most knock-down asset. By studying the precepts of account and invest, the author believes that individuals will be able to see the remainder between an asset and a indebtedness ; in fact it is the more concrete lotion of learning what ’ s correct and what ’ randomness wrong. Generating a bowed stringed instrument of expenses is wrong, building assets is right. Unlike individuals who earn and then pay taxes on what they earn, corporations earn, spend what they want to spend, and pay taxes on what ’ randomness left. Corporations, therefore, hold a certain degree of power. The rich know how to use this exponent, the poor don ’ thymine. The writer besides believes that true luxuries are experienced when they are the outbound manifestations of intelligent invest and asset building. He cites the example of his wife purchasing a Mercedes Benz because it was the car she liked and worked arduous to be able to purchase it. The writer cautions however about keeping up with the Joneses and getting into debt because of this human infirmity.

fear, sloth, cynicism and arrogance are to be blamed for most of human inaction .

External Links

Wikipedia ‘s article