When there is a talk going on regarding books on personal finance and businesses, this book never misses the list.
In this post, I am going to share with you Rich Dad Poor Dad review or you can say quick rich dad poor dad summary and 5 mind-boggling lessons I personally learned from the book, which changed my perception of money.
Rich Dad Poor Dad is the most-read personal finance book currently in the world and it has its reasons why it is enjoying the position at the top with titles of amazon best-seller, new york times bestseller and many more.
Well, this book has its share of criticism as well where people ask whether rich dad is legit or not? I would certainly not bother about rich dad whether he is legit or not but I am certainly very sure that rich dad tips actually work in real life.
There are some great lessons which we can learn and apply from the book which can transform your life if understood properly.
Rich Dad Poor Dad summary
Rich Dad Poor Dad was one of the first books I started as a reader and trust me, the simplistic manner in which everything is explained, it just completely blew my mind.
To be honest, this book was an eye-opener for me. I never looked at money as I did earlier.
The way Robert Kiyosaki explains how schools teach us how to be employees and not to employ someone shook me very hard.
Robert very well explained that the schools are giving us scholastic and professional skills, but are lacking teaching financial skills, that is why most of the people are struggling financially in their career and adulthood.
He explained how to control and manage money and not to be a slave to money.
I am writing a review of this book, just because this book has taught me a lot about financial intelligence which no other book has taught me.
Fear and greed are 2 emotions that do all the problems.
Rich don’t work for money but make money work for them, the poor and the middle-class work for money.
Why do they work for money?
Because most of their money decisions are based on emotions of fear and greed.
1. They work for money because they fear one day, they will run out of all the money they have and will not be able to pay their bills which keeps them continuing working for money.
2. They work for money with greed thinking more money will solve their problem, but less money is not the problem the way you handle it with the right mindset where the actual game is.
Robert’s Rich Dad very well elaborated the point he bought luxurious stuff only and only when we had assets enough to generate cash flow to buy those things.
People have desires and they buy things through sentiments. They buy things impulsively, not logically how are they gonna be able to pay for it.
We have to keep on controlling these emotions accepting the fact that they are there. Hence, self-control is the ultimate mastery if a person has self-control he can achieve anything in life.
Taxes punish those who produce and reward those who don’t produce.
Rich dad believed in not paying too much tax ( legally and not evading), he believed in starting a company so that he can pay tax after spending on the company expenses which will reduce the tax.
For eg, Individuals get a salary and they pay the tax upfront and then spend, but it doesn’t go that way for companies.
For companies, they earn they spend on expenses and then they pay tax on whatever is left. You can cover things on company expenses like company parties, employee’s salaries and much more, etc and that is one of the secrets the rich pay taxes a lot lesser. Therefore, start a company and pay less tax.
Rich Dad used an analogy where he described that he is paying lesser tax than someone who is earning way less than him.
This was also a great shocker for me on how we can easily save a lot of tax legally. If I hadn’t read this book, I would have certainly not think of this thing.
Broke is Temporary and Poor is eternal.
Poor and broke are 2 different things. Broke is a person who doesn’t have money right now and poor is someone who will not have any time.
A broke person with the right mindset can earn a fortune for himself but with a poor mindset, nothing could be possible.
That is why this book emphasizes the rich mindset very much how kids who grow up in a rich family learn to think from the rich mindset while the poor person thinks from a poor mindset.
This book doesn’t indicate that people born in poor families will remain poor for a lifetime but it surely indicates that for a poor person to get rich, a right mindset is definitely required and that is what this awesome book “Rich Dad Poor Dad” teaches you.
A person who doesn’t care for his personal finance will be always poor and that will be eternal. Not having money right now is a different thing and not having money anytime is different. Learn to build assets in your asset columns.
Great investor Warren Buffet also says
Here he is indicating to acquire assets so that you don’t have to actively work for money.
The single most powerful asset we all have is our mind.
The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth.
Let me explain you with an example: There are 2 flats which are to be rented in the same locality
Flat 1: It is fully empty, no decoration and not furnished at all.
Flat 2: It is beautifully decorated and well furnished.
What do you think? Which flat will get more rental?
I hope you agree that Flat 2 will get more rent as it is more decorated and furnished.
The same things happen with humans also, you will earn more if you are more knowledgable and skilful than the person who is trying to compete with you and this will only happen when you invest in books, courses and seminar to increase knowledge and skills.
We invest in clothes, fashionable items, gadgets, cars, vacations, etc. but we forget to invest in self-education and learning, learning to teach ourselves.
We all just ignore the fact to invest in ourselves, but remember our mind requires exercise, it has been given to us to think.
Rich Dad teaches Robert to invest in learning new skills so that he can be capable enough to hire people in future.
I buy and read lots of books, have done many paid courses only to increase my knowledge because I know my mind is my greatest asset, who knows a great idea can create enormous wealth for you.
Start investing in yourself and you will be a great asset for yourself.
Winning for them means being unafraid to lose
Rich people are courageous enough to take risks, they know how to manage risks. Wealthy people do not wait for things to happen, they make things happen.
In addition, they believe learning from failures is a success in itself. They believe success is failure turned upside down. They believe to buy luxuries after acquiring enough assets. In other words, they take the stairs of failures to reach success.
I hope you liked this brief rich dad poor dad summary
In conclusion, I would like to say the strategies in the book if properly implemented would help you get way ahead in life.
Thank you for reading.
My Personal Finance post: http://theimprovementterminal.com/financial-freedom-stress-free-life/
My Quora Profile: https://www.quora.com/profile/Arjun-Sachdev
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