Book Information
Title : RICH DAD POOR DAD
Author : ROBERT T.KIYOSAKI
Publication Date : April 11, 2017
Genres : Personal finance, investing, business
Pages : 336
ISBN-13 : 978-1612680163
How I met this book
As far as I remember, I first found this book when I was in Japan. Of course, there was a book written in Japanese. I do not think that I took and read this book at that time. After I came here, I found this book on Kindle. I was looking for books randomly, and in the business sections, this book was recommended. As soon as I saw this book, I recalled the moment when I saw the book in a Japanese bookstore. I tend to buy business books on Kindle, so I decided to buy this book on Kindle. When I read this book for the first time, I did not really enjoy this book for some reasons. I just read through it.
And a few months later, my friend bought the paper edition of this book. When I saw that, I was like “I literally do not remember what the author says… All I remembered was that I did not really enjoy reading this book on Kindle.” The feeling inspired me to reread this book. I asked my friend to borrow the book, and I started reading this book again to remember what this book is about.
Summary of this book
Short Summary
Growing up, there were two people who taught the author: Poor Dad, his own father, and Rich Dad, his friend’s dad. The author introduced the financial lessons and opinions that each dad taught him from different perspectives. The author emphasizes the difference between assets that creates money into your pocket and liabilities that takes money out of your pocket. Understanding the difference is one of the key point to succeed financially. Instead of working hard for money, developing financial intelligence is important to become rich. Being rich can be defined by the question, “How long can people survive if they stopped working today?”
Chapter Summary
Chapter 1: The Rich Don’t Work for Money
Once the rich dad agreed to teach the author and his friend, Mike, he had them work three hours every Saturday morning at one of his convenience stores. At first, their salary was 10 cents an hour. As they worked, they were getting frustrated and angry at him. When they told him about their emotions, he said that that is how most adults feel like. In other words, are controlled by fear and greed. Afterwords, the author and Mike decided to open a small library where they lend kids comic books that would have been thrown away from the convenience store. Although the business had to shut down, they learned how to make money work for them, meaning that they do not need to be there physically.
Chapter 2: Why Teach Financial Literacy?
Most people misunderstand how to get rich. They think that more money solves their financial problems. They still struggle because they do not understand the difference between assets and liabilities. Their cash flow is: income from the jobs to liabilities and expenses whatever they have to pay for. But rich people’s is income from assets to be able to cover other expenses and liabilities. The author’s point is not that people shouldn’t buy any luxuries, such as cars and houses. His point is that the expense should be covered by the income from assets. The good question that people can ask themselves to know whether they are wealthy or not is “if I stopped working toady, how long could I survive?”
Chapter 3: Mind Your Own Business
“Mind your won business” means that “Don’t spend your whole life working for someone else.” Most people work for everyone else, such as their employer, government(tax), and the bank (mortgage). They are confused about business and profession. For example, their profession is banker, but that does not mean they own the bank. Focus on assets column. The author describes that there are 7 kinds of assets, and people should pick some of them that they like. If they don’t like them, do not do that. Think of money as an employer. Do not let it come out or make them work for 24 hours a day.
Chapter 4: THE HISTORY OF TAXES AND THE POWER OF CORPORATIONS
Tax was invented against rich people. However, as the government grows, the tax soon needs to be levied on the middle class, eventually on the poor, too. While the government does so, the rich people find ways to minimize their tax burden with financial intelligence that is made up of accounting, investing, understanding markets, and the law. For example, a corporation can pay expenses before paying taxes. On the other hand, an employee has to pay for tax and spend on expenses from what is left.
Chapter 5: THE RICH INVENT MONEY
Wit financial Intelligence, people can make more money and can be free. The author introduces the example of that. He takes advantage of the system of tax on real estate selling. He buys real estate that is overlooked as a value, and he sells it at higher price when its demand is high. Before the profits are taxed, he buys new real estates and does the same. The money creates more money through the process. His point is that small amount of money can generate more money with intelligence and courage to take risks.
Chapter 6: WORK TO LEARN-DON’T WORK FOR MONEY
Specializing is recognized as a good way to create money, but the author describes that learning business components such as management, sales, and marketing. There are many writers and cooks who are really good at their specialty. However, without the business skills, they cannot sell well. The example is that the author describes himself as not a great writer, but this book is sold a lot with the business skills.
Chapter 7: OVERCOMING OBSTACLES
Some obstacles prevent people from having financial success. He introduces fear, cynicism, laziness, bad habits, and arrogance. There are many people who are afraid of losing or making mistakes. The truly winning is not to be afraid of losing. Being busy is just lazy. Paying themselves first can create pressure that motivate them to make more money.
Chapter 8: GETTING STARTED
There has to be strong enough reason why we want to be rich. The reason can be created by the combination of want and not-want. Choosing friend is important to keep being int he same mindset. There used to be person whom people want to imitate in the future when they were kids. We don’t forget those pope who inspire them. Paying themselves first strengthen them by the pressure. We need to give what we want to get or experience first. For example, if we want to get propel smiling, we should smile first. This can apply to money, as well.
Favorite Quotes
“Life pushes all of us around. Some people give up, and others fight. A few learns the lesson and move on. They welcome life pushing them around” (p.29)
“A job is only a short-term solution to a long-term problem.”(p.48)
“Intelligence solves problems and produces money. Money without financial intelligence is money soon gone. “(p.64)
“It ‘s not how much you make, it ‘s how much money you keep” (p.65)
“The rich acquire assets. The poor and middle class acquire liabilities that they think are assets”(p.67)
“Once a dollar goes into it, never let it come out.” (p.113)
“The best thing about money is that it works 24 hours a day and can work for generations.” (p.113)
“An important distinction is that rich people buy luxuries last, which the poor and middle class tend to buy luxuries first.” (p.113)
“Employees earn and get taxed, and they try to live on what is left.” (p.133)
“Often in the real world, it’s not the smart who get ahead, but the bold” (p.146)
“Why would you want to increase your financial intelligence? Because you want to be the kind of person who creates your own luck” (p.152)
“Job security meant everything to my educated Dad. Learning meant everything to my rich dad”(p.183)
“Life is much like going to the gym. The most painful part is deciding to go. Once you get past that, it’s easy.” (p.188)
“Being technically specified has its strength as well as its weakness”(p.192)
“Without a strong reason or purpose, anything in life is hard”(p.235)
How I felt about this book
Reading this book definitely gave me a different perspective on money. I was surprised how different the lessons in this book than what we learn at school. However, what he describes in this book makes sense to me, and I agree with his points. For example, there are so many professionals who have specialized techniques or skills, but they are not successful when it comes to financial success.
This book reminds me of the importance of the combination of specialization and business skills. In the end of this book, the author says that taking actions is very important. I learned a lot from this book, but this book introduces general ideas when it comes to money. In order to get financial freedom, I think learning the more deeply is necessary. Throughout this book, it was easy to understand the contents as a book, so this book is recommended to everybody who does not like reading books.
Whom I recommend to read
- Those who want to be financial free
- Those who want to learn general ideas to be rich
- Those who want to learn about money