This book is in my top three lists of books to read after, “Think and Grow Rich” by Napolean Hill and “The Richest Man in Babylon” by George Clayson. I first came across this book when an in-law of my showed me and attributed his success at that time to reading this book. Then when my husband bought it, I had to read it and even read the sequence “cashflow quadrant”.
I consider this book as one of the best financial books you must read if you are seeking financial freedom. I liked how Kiyosaki viewed the world from a different perspective and it got me into thinking and planning my own investments strategies
In Rich Dad Poor Dad, Kiyosaki tells the story of the difference between his “poor” dad (his real dad), and the “rich” dad that helped him understand business and become wealthy. Kiyosaki talked about the things that the rich consider important and what the poor consider important. The following was covered in this book:
1. The rich don’t work for money
2. The importance of financial literacy
3. Minding your own business
4. Taxes and corporations
5. The rich invent money
6. The need to work to learn and not to work for money
According to Kiyosaki, the rich don’t work for money. They work to learn things, and the things they learn can easily be applied to make money over and over again.While you are working, see it as an opportunity to get good ideas that you can use to create the life that you desire.
Kiyosaki gives you guidance on how to think about money, assets and liabilities. He actually opened my understanding to the fact that your primary residence, with a large mortgage, high taxes and high fixed costs in running in the maintenance of the property, is not an asset because as long as you are living in that property it is producing a positive cash flow instead it’s taking away money from you in the form of a running cost. It can become an asset only at the point you sell it. He then went further to list examples of items considered as assets such as rental property, stocks, bonds, mutual funds, business partnerships with limited involvement, promissory notes and royalties that generate money which you should invest in. We all know that the majority of us do not practice this, but the rich does, hence they are rich. The majority of us would rather indulge in purchases of non-necessities using debts.
In this book, Kiyosaki discourages accumulating debt except for investments purpose only, such as real estate and stocks. Instead, you should only use debts to get things that go up in value. Kiyosaki advises that the best way to use your credit cards for your own gain. Kiyosaki teaches you to pay off your debts and start investing into generate revenue.
In summary, the concepts behind this book is that you should work hard to save money when you are working and use it to build for yourself assets that can eventually grow enough to replace the income you make from your employment which will allow you to live the life you want. I will recommend you read this book and If you have let me hear what you think.
Rita O Effeyota