Rich Dad Poor Dad – a quick book summary and review

Oct 31, 2022 | Books, Self Improvement | 0 comments

If you were to stop working right now, how long can you live comfortably on your remaining savings? By answering this, you could get a pretty good idea about your wealth status. 

A man named Robert Kiyosaki.

Robert Kiyosaki is an American investor, businessman, author, and motivational speaker. As of September 2022, Robert Kiyosaki’s net worth is roughly $100 Million. 

But he wasn’t raised in a wealthy background. In fact, his family was like most people, who worked but didn’t have the best life and often times struggled with money. So then, how did Robert become rich today? Let’s take a look as he explains in his book, rich dad poor dad. 

Robert Kiyosaki was born in a little town called Hilo in Hawaii. A lot of rich families lived in this small town. This town had a lot of doctors, business owners, and bankers. 

Robert’s family was not one of these rich families. But little Robert attended the same public school where the rich people sent their children.

Robert had only one friend called Mike. He was also a regular kid like Robert. The rich kids at school didn’t care about them. They would separate themselves from Robert and Mike because the two friends were unable to afford the newest collections of toys and bikes like them.

So one day, Robert asked his father, “Dad, can you tell me how to get rich?”

Robert’s father was a highly educated man. He had a Ph.D. and completed four years of undergraduate work in less than two years. He had also completed multiple universities with excellent degrees. But he had zero financial knowledge.

His dad didn’t know the correct answer, so he responded with, “son, to be rich, you have to learn how to make money.”

Little Robert, who had no financial literacy, took this to heart. So, together with Mike, Robert started making plans to become rich. The two spent an entire morning one Saturday brainstorming all the ways they could make money. After a long discussion, the two friends had a plan to become rich.

Empty Toothpaste Tubes?

The following day, they began to work. Robert and Mike started to collect empty toothpaste tubes. In those days, toothpaste did not come in plastic tubes. The tubes were made of lead. They walked to every house in the neighborhood, asking for empty toothpaste tubes. 

If someone asked them why they were collecting empty toothpaste tubes, their answer was, “that’s a company secret.” 

After a few days, the two friends managed to collect enough empty tubes for their project. So both of them went to Robert’s house to start making money.

Because of the noise coming from the house, Robert’s father came to see what was happening. He walked up cautiously, and when he saw what the two boys were doing, he was stunned to speak.

The two kids were melting the toothpaste tubes in a pot. They were casting nickels out of the lead.

When Robert’s father said that to become rich, you have to learn to make money, the kids took that literally. They thought that to become rich, they had to make their own money.

Robert’s father saw that the two kids were confused about this whole making money thing. So Robert’s poor dad suggested that the two learn how to make money from Mike’s dad. (Robert’s rich dad). 

The Rich Dad

Now Mike’s father had never finished the eighth grade. He is not someone like Robert’s father. But he has good money management skills. Although he is not as smart as Robert’s father, in the long run, Mike’s dad becomes one of the richest men in Hawaii. While Robert’s dad struggled financially all his life.

Throughout the book, Robert Kiyosaki teaches about the principles he learned from his rich dad. He also compares and contrasts the differences between his father’s and Mike’s father’s mindset. This is how the book gets its title, Rich dad Poor dad.

I’ll mention a few principles Robert Kiyosaki says in this book.

1. Assets & Liabilities

The first lesson is that you must know the difference between an asset and a liability. If you want to be rich, this is all you need to know and understand the most!

The primary cause of financial struggle is simply not knowing the difference between an asset and a liability. An asset is something that puts money in your pocket. A liability is something that takes money out of your pocket. 

Things like Lands, Buildings, Investments, stocks, and businesses are examples of assets. While bills, student loans, and leasings are liabilities.

The rich acquire assets, and the poor and middle class acquire liabilities.

2. Lifestyle

Throughout this book, Kiyosaki says that you should always spend less than you earn.

This does not mean you can’t spend money on the things you love in order to enjoy your life. Instead, suppose you want to create a more stable financial future while still enjoying that occasional fancy dinner. In that case, you can make some conscious financial decisions, such as saving extra money, creating a budget, and cutting back on unnecessary expenses.

If you are spending all of your monthly income on monthly expenses, then there is a problem. Kiyosaki says again and again that people always spend money to buy unnecessary things. He also shows the difference between wants and Needs.

3. Mindset

Always think like a successful person. When you are doing something, think, would a successful person do this? Instead of thinking that I can’t do this, this will fail, think about how to do the task. Don’t be afraid to take risks.

Kiyosaki compares his two father’s mindsets throughout this book.

Poor Dad: I’m not rich because I have children.

Rich Dad: I must become rich because I have children.

Poor Dad: “I’ll never be rich.”

Rich Dad: “I’m a rich man, and rich people don’t do this.”

Poor Dad: “Don’t take risks.”

Rich Dad: “Learn to manage risk.”

Poor Dad: A house is the biggest asset you own.

Rich Dad: A house is a liability.

Poor Dad: Don’t talk about money over dinner.

Rich Dad: Talk about money and business over dinner.

Poor Dad: Study hard so you can find a good company to work for.

Rich Dad: Study hard so you can find a good company to buy.

Another thing Kiyosaki learned from his rich dad is that people make financial decisions based on two emotions. Fear and Greed. The fear of being without money motivates us to work hard, and then once we get that paycheck, greed or desire starts us thinking about all the wonderful things money can buy. 

Rich Dad said, “learn to use your emotions to think, not think with your emotions.” I’m not going to discuss this as this is written in the book much more enjoyable. 

I’ll also mention one flaw of this book. Before starting his own business, Kiyosaki worked in a few high-paying jobs and had saved up some money. So he started his journey from these savings. So it would be best if you had at least a couple of thousand dollars to begin something. That is why we say “You need money to make money.”

By the way, If you like to read quotes, I have pulled together some of the best quotes from Rich Dad Poor Dad. You can read them here. Best Quotes from Rich Dad Poor Dad.

After reading this book, I learned to manage my money more carefully. I stopped buying unnecessary things and learned how to invest. This blog you are reading is also an idea that came to mind while I was reading rich dad poor dad.

This book will change your view on money. I can recommend this book to anyone who wants to learn about money management. It is written in a very simple way that anyone can understand.

So this is my review on rich dad poor dad. I hope you enjoyed this reading. If you have read this, please leave a comment down below, or if you are planning to read this, I believe this review has helped you. 

Thank you for reading & see you soon with another article.

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