Robert T. Kiyosaki’s best-selling book “Rich Dad, Poor Dad” has been heralded by many as a must read for people interested in building wealth. Though the book was originally published 20 years ago in 2000, advice from it is still referenced among best-practices in pursuit of financial freedom. Based on one author’s assessment, here are the top 5 financial lessons from “Rich Dad, Poor Dad.”
In a summation of the top takeaways from Rich Dad, Poor Dad, Wahed highlighted Kiyosaki’s advice that people find a way to make passive income. He also says there must be a strategy in place to help accomplish this and one has to overcome fear and desire to be successful at implementing it.
“Rich Dad persuades the young boys (as they are at this point in the book) to stop thinking about wages and start thinking about how they can generate money for themselves. He argues that most people miss opportunities because they seek money and security, but once you get rid of this, you view the world in a different way: full of opportunities,” Wahed’s editors summarized.
In the book Kiyosaki highlights that people who are financially wealthy not only save money, they avoid trying to “keep up with the Joneses” so to speak.
He differentiates between assets (which make money) and liabilities (which take money). It is more important to acquire the former, the book states.
“The only things that can be classed as assets are things that actually bring in money: additional rented properties, for instance, are assets. The key, Kiyosaki explains, is to limit your liabilities and grow your assets,” Wahed summarizes. “He argues that average, middle-class people focus on their wage slips and what they bring in, whilst the rich focus on acquiring and building their portfolio of assets knowing that building passive income is the key to attaining financial freedom.”
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According to Kiyosaki, it is important to pay yourself first, even if you are unsure of how the remaining bills will be paid. The added pressure, he believes, will force you to be creative in generating more income. In their summation of the book, Wahed added a disclaimer that they weren’t encouraging anyone to be irresponsible, but rather to be more creative.
“The idea behind this, according to Rich Dad, is that when you do not have enough money to cover an essential thing like paying bills, this pressure drives your creative genius to inspire ways that will ensure you cover the bill money that month. However, if you pay the essentials first with ease, your genius will not be inspired as you will simply pay yourself whatever the remainder is rather than being forced to come up with more,” Wahed wrote. “the point behind giving yourself that pressure is a sound one to inspire in you some commercial creativity that might just lead to a new business idea or some other income-generating proposition. This is why you often find that entrepreneurs come from financially unstable backgrounds – the pressure inspired them.”
Another top takeaway from Kiyosaki is to be bold when making busines deals. According to Wahed’s summation, “Kiyosaki puts forth the argument that it isn’t smart people who get ahead in the world, it’s bold people.”
Citing an example of how he did real estate deals at bankruptcy proceedings to buy assets at greatly discounted prices, Kiyosaki posits if one only looks to saving money as a way to build wealth, “this limits people’s mindsets and ability to take advantage of opportunities.”
The final top takeaway Wahed highlighted from Kiyosaki is to be strategic about the jobs you take as they are actually educational resources.
For example, in the book per Wahed, Kiyosaki shares he “took jobs as a construction worker, a busboy, reservations, marketing, and sat in on meetings (with Rich Dad) with lawyers, bankers, accountants, etc. This was all part of learning a little about a lot so that he could run his companies in the most effective way.”
