Author: Robert Kiyosaki
Publisher: Warner Books
Reviewed by: cecil36
Rating: 10 (on a scale from 1 to 10)
Summary: Covers the topic of financial literacy
in a new light. The author challenges the accountant's
definition of an asset
and explains how the rich acquired their wealth.
In the late '90s, Robert Kiyosaki put pen to paper, and authored this best-selling book on the topic of financial literacy. This book is very controversial in the fact that Kiyosaki challeneged every belief the working class had on money. For example, Kiyosaki challenged the fact that a person's house is an asset. He admits it's an asset, but according to his philosophy, the house is really the bank's asset. According to Kiyosaki, the house is a liability because of the mortgage or possible decline in property value. In order for the house to be counted as an asset, it would either be producing a positive cash flow (i.e. a rental property), or have increased in value since purchase.
What Kiyosaki emphasizes a lot in this book is that money is an idea. He first illustrates his point with a short-lived business that he and his best friend started while they were kids. Since "Rich Dad", Kiyosaki's mentor, was only paying him ten cents an hour to work in a convienence store, Kiyosaki was forced to come up with creative ways to make money. His idea was that with all the unsold comic books, he and his friend would start a library where the city kids would come in and read as many comic books as they wanted for ten cents a day. The business only lasted a couple months, but Rich Dad was impressed that Robert has learned his lesson on creating wealth
Kiyosaki has made much of his money in real estate, but endorses any form of investment that yields passive income. He puts a lot of emphasis on owning a business, and he breaks up businesses into three different categories. They are the corporations, franchises, or network marketing (aka multi-level marketing) businesses. He explains the pros and cons of each type of business, but the one thing he says about all these types of businesses is that there's a system in place that drives the business.
This book is a must-read for anyone who is stuck in what Kiyosaki describes as the "Rat Race". The Rat Race is the pattern of working for a paycheck, and spending it all on taxes, expenses, and paying off debt. Even though everyone who reads Rich Dad Poor Dad will not buy into wanting to become financially free, it may stir up something where they will learn how to better manage their money.
Table of Contents
Introduction: There Is A Need
- Rich Dad, Poor Dad
- Lesson One -- The Rich Don't Work For Money
- Lesson Two -- Why Teach Financial Literacy?
- Lesson Three -- Mind Your Own Business
- Lesson Four -- The History of Taxes and the Power of Corporations
- Lesson Five -- The Rich Invent Money
- Lesson Six -- Work to Learn -- Don't Work For Money
- Overcoming Obstacles
- Getting Started
- Still Want More
Epilogue: College Education for $7,000