Book Review – Rich Dad, Poor Dad (Week 7 of 52 Books in 52 Weeks Challenge)
November 24, 2011 Leave a comment
This week we take a look at Rich Dad, Poor Dad by Robert Kiyosaki. RDPD tells the story of an extremely successful businessman who preaches to be financial literate. Kiyosaki claims that even the most intelligent people in the world who have tons of education can be poor because they don’t learn how to manage money correctly and make money work for them, instead they spend their lives working for money.
To illustrate his points, Kiyosaki tells his own story of growing up with two fathers. One is his well educated father with several post graduate degrees and a wealth of knowledge from studying. He also happens to be his “poor” father (and his biological one). The father to his childhood friend is who he considers his “rich dad”, a man who didn’t even complete high school and wound up an incredibly successful and wealthy businessman by learning how to make his money work for him instead of the other way around. Kiyosaki grew up learning from both individuals, attributing his success to being able to balance the two and learn from both.
Kiyosaki preaches a lot of things in this book, and drives home some interesting concepts that are worth noting. One such thing is that Kiyosaki drives home the difference between an asset and a liability. Anyone who has taken a finance or accounting course should be able to tell you the difference. However, Kiyosaki suggests that most people know the definition, but don’t understand the true nature behind them and how to recognize assets and increase the asset column (which is the key to successful long term financial independence).
Another lesson from Kiyosaki that he preaches, and one that I full heartily agree with, is that the best investment anyone can make is in their education. Be careful to realize that Kiyosaki isn’t just talking about college or post graduate school. He’s talking about continuing your education and having that drive to gain knowledge on a wealth of differing areas, by reading books, attending classes, and attending seminars where you can pick up great advice and increase your knowledge.
These are just a few things Kiyosaki covers in much greater detail. He offers a lot of good solid advice and a different mindset. He challenges the old adage that a house is your greatest investment (though he’s clearly a big believer in real estate), while also urging you to pay yourself every month before you pay the government or your bills. Basically he believes that by setting aside the money you want each month for yourself first, you’ll be motivated to find ways to increase your income so you can pay those bills and taxes. An interesting concept for sure.
Pick up a copy of the book for more info. It’s a great read, and doesn’t take long at all.