Rich Dad Poor Dad, Robert Kiyosaki - Executive Summary

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` Submitted by: Nishchay Garg “The main reason people struggle financially is because they have spent years in school but learned nothing about money… but never learns to have money work for them”. Robert Kiyosaki has challenged and changed the way tens of millions of people around the world think about money. With perspectives that often contradict conventional wisdom, Robert has earned a reputation for straight talk, irreverence and courage. He is regarded worldwide as passionate advocate for financial Rich Dad Poor Dad-The# 1 personal Finance book for all time! Rich Dad Poor Dad is a starting point for anyone looking to gain control of their financial future.”- USA TODAY

Transcript of Rich Dad Poor Dad, Robert Kiyosaki - Executive Summary

Page 1: Rich Dad Poor Dad, Robert Kiyosaki - Executive Summary

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Submitted by: Nishchay Garg

“The main reason people struggle financially is because they have spent years in school but learned nothing about money… but never learns to have money work for them”.

- Robert T. Kiyosaki

Robert Kiyosaki has challenged and changed the way tens of millions of people around the world think about money. With perspectives that often contradict conventional wisdom, Robert has earned a reputation for straight talk, irreverence and courage. He is regarded worldwide as passionate advocate for financial education.

Rich Dad Poor Dad-The# 1 personal Finance book for all time! “Rich Dad Poor Dad is a starting point for anyone looking to gain control of their financial future.”- USA TODAY

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Robert KiyosakiRobert T. Kiyosaki is best known as the author of Rich Dad Poor Dad. This is the #1 personal finance book of all time, which has challenged and changed the way tens of millions of people around the world think about money.

His book title holds four of the top ten spots on Nielsen Bookscan List's Lift-to-Date Sales from 2001-2008 alone. In addition, Robert has been featured on shows such as Larry King Live, Oprah, The Doctors, Bloomberg International Television and CNN.

Educational Entrepreneur, co-creator of the CASHFLOW® board game, founder of the financial education-based Rich Dad Company and author of New York Times Bestsellers: Rich Dad Poor Dad, Conspiracy of the Rich: The 8 New Rules of Money, and

Unfair Advantage

Summary

Robert T. Kiyosaki is a simple 9-year-old boy living a simple life with his father, the educated one (poor dad). Robert regard his biological father as the poor one because he is educated person but not financially intelligent. Together with Mike, his best friend they want to become rich because other kids do not want to play with them, they said they were “poor kids”. That’s the time they ask help from Mike’s dad, the less

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Summary

Robert T. Kiyosaki is a simple 9-year-old boy living a simple life with his father, the educated one (poor dad). Robert regard his biological father as the poor one because he is educated person but not financially intelligent. Together with Mike, his best friend they want to become rich because other kids do not want to play with them, they said they were “poor kids”. That’s the time they ask help from Mike’s dad, the less

Kiyosaki remember what his rich dad told him about the history of taxes and how important owning a business can make a person rich and avoid taxes. He explains that corporations are just a legal body created by a legal document. The rich used the power of corporation against taxation because it offers a lot of tax advantages and protection from lawsuits. He also emphasizes in the story about a woman who is a newspaper reporter. She has a Master’s Degree in English Literature. This woman wants someday to be a bestselling author like Robert but her novels not seem to go anywhere that’s why she sticks into that paper job. She asks for any suggestion from Robert and he suggested that she must study sales, but the woman get offended, why would she study sale if she want to be a bestselling author. Kiyoski’s point is to study sales in order

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Kiyosaki remember what his rich dad told him about the history of taxes and how important owning a business can make a person rich and avoid taxes. He explains that corporations are just a legal body created by a legal document. The rich used the power of corporation against taxation because it offers a lot of tax advantages and protection from lawsuits. He also emphasizes in the story about a woman who is a newspaper reporter. She has a Master’s Degree in English Literature. This woman wants someday to be a bestselling author like Robert but her novels not seem to go anywhere that’s why she sticks into that paper job. She asks for any suggestion from Robert and he suggested that she must study sales, but the woman get offended, why would she study sale if she want to be a bestselling author. Kiyoski’s point is to study sales in order

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Evaluation

The book does a fantastic job teaching how to think about work and money. I like the way it is explained at a level that anyone can understand, specifically the concept around how the rich buy assets, and the poor buy liabilities. This book has valuable lessons for people of all ages. It was written because the author believes that traditional schooling is also very important but no longer enough in regards to financing. Let me say right away that I am very glad it was written and I found the book very valuable. The thoughts and ideas I obtained from the book have made me realize that I can control of my financial future. Most people are not rich, wealthy and not even literate when it comes to the world of money. Rich Dad Poor Dad simply helps guide the average person to start thinking differently when it comes to money. It is the best starting point that one can take on the road to financial literacy. For all of those who have always believed there is more to life than our everyday routine and for those who know there has to be a better way, but just don't know what it is. You have to read Rich Dad Poor Dad, I guaranty it will open your eyes and mind, explode the myth that you need to earn a high income to become rich, challenge the belief that your house is an asset, show parents why they can’t rely on school system to teach their kids about money, define once and for all an asset and a liability and teach you what to teach your kids about money for their future financial success. In case you believe working on a company can make you out of struggle, think again, you will never be rich working for someone else instead, look for someone that can work for you. Rich Dad Poor Dad will relate to you in so many ways, and if you’re open minded, it may just help you to change your life.

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Learning

Chapter 1: Rich Dad, Poor Dad You can learn some valuable lessons from the two dads but when you compare them you can see the contrasts between their views about working hard, getting an education, saving and investing and realizing how habits of the rich and poor significantly differ. One would say “go to school, and after you finish your studies find a high paying job”. The other would say “there are some skills you cannot learn from school”. There are many different views and ideas that can influence a lot of mind.

Chapter 2: The Rich Don’t Work for MoneyBase on the book there are two main emotions which can prevent people from developing wealth: fear and desire; fear of not being able to pay expenses or fear of losing money keep many focus in the day-to-day work, preventing many from evaluating investments and other sources of income. The desire to keep physically good looking appearance by buying expensive clothes or even to become “in with the trend” by buying gadgets drives expenses so high that people have no choice but to stay focused on their jobs to maintain their lifestyle. Lesson one is all about understanding those two emotions and stopping them from hindering one’s success. The Rich Dad was more focused on ways of creating his own money, money that increases even if you don’t work, rather than waiting for the next job with a pay raise.

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Chapter 3: Why Teach Financial Literacy?Financial literacy is simply means the study of managing one’s finances. There are a few basic terms one would need to know in order to understand financial literacy. The first is Income and Expenses. “Income” is simply the amount of money you earn like wages, salaries, etc. “Expenses” are things like taxes, food, rent, clothes, fun, and transportation. The second one is the Asset and Liabilities. An “asset” is something that puts money into your pocket like stocks, bonds, investments. A “liability” is anything that takes money out of your pocket home mortgages, loans, credit card debts. The rich keep his income and used the return of their investment to cover up their expenses. While the poor uses their salaries and wages to cover up their expenses. It simply means one must invest to cover his expenses rather than waiting for the pay raise.

Chapter 4: Mind Your Own Business As mentioned on the previous chapter, focusing on your asset is the key quality that must be developed in order to gain wealth. The rich focus on improving the size of their investments rather than simply waiting or demanding pay rises in their income. This means keep your expenses low, reduce your liabilities and build a base of solid assets.

Chapter 5: The History of Taxes and the Power of CorporationsBy creating a personal corporation, the rich are able to avoid many of the personal taxes because it offers a lot of protection from them and there is a corporate exemption. But take note that not paying taxes is called tax evasion and it is illegal! By filing as a corporation, the rich are able to mitigate their losses to only the amount they invested in the corporation. They are able to pay taxes after they pay for expenses. For people who have jobs, it’s the opposite case where taxes are taken out of pay checks before one is able to cover expenses. In Comparison the rich people with corporations earn, spend and pay taxes while the people who work for corporations earn, pay and spend taxes.

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Chapter 6: The Rich Invent Money Behind the wealth, a combination of financial intelligence and a little bit of guts is what behind in this chapter. Self-doubt holds back a lot of people. In order to gain wealth, self-confidence is really needed. While saving at the bank seems secure, it is not worthwhile because savings rates are often below the rate of inflation. “Scared money doesn’t make money.” Kiyosaki follows the same logic, if you truly want to see your investments grow exponentially you must be willing to put in the money in places that show relative risk.

“Find the game where you can win, and then commit your life to playing it; and play to win.”

― Robert Kiyosaki