Book: Rich Dad Poor Dad (1997)
Author: Robert T. Kiyosaki
1) The Rich don't work for money. A job is really a short-term solution to a long-term problem. Learn to use your emotions to think, not think with your emotions. Let go of the idea of working for money and instead learn to have money work for you. Keep using your brain, work for free, and soon your mind will show you ways of making money far beyond. You will see things that other people never see. Story of the comic-book library
2) If you want to be rich, you need to be financially literate. Rule 1 You must know the difference between an asset and a liability, and buy assets. It is the only rule. An asset is something that puts money in my pocket. A liability is something that takes money out of my pocket. The real cause of financial problems is how people choose to spend the money they do have. The greatest losses of all are from missed opportunities. If a couple put more money into their asset column early on, their later years would get easier. Dedicate your life to investing more and minimizing liabilities. Concentrate on only buying income generating assets. Focus on keeping liabilities and expenses down. Wealth is the measure of the cash flow from the asset column compared with the expense column.
3) What business are you in? Mind you own business. Your business revolves around your asset column, as opposed to your income column. Start buying real assets. Assets suggested for your children businesses that do not require their presence, stocks, bonds, mutual funds, income-generating real estate, royalties from intellectual property such as music, patents, print.
4) My real estate strategy is to start small and keep trading the properties up for bigger properties and therefore, delaying paying taxes on the gain. This allows the value to increase dramatically. Rich people buy luxuries last, while the poor and middle class ten to buy luxuries first. A true luxury is a reward for investing in and developing a real asset.
5) The rich do not play by the same set of rules; they created the corporation as a vehicle to limit their risk to the assets of each voyage. A corporation protects the rich. The income-tax rate of the corporation is less than the individuals; certain expenses could be paid with pre-tax dollars within the corporation. As long as you keep trading up in value, you take advantage of these tax savings offered legally.
6) Financial IQ synergy of these four areas of expertise
1) Accounting financial literacy the ability to read and understand financial statements. The ability to read numbers
2) Investing science of money making money.
3) Understanding Markets the science of supply and demand.
4) The Law knowledge of tax advantages and protection provided by a corporation. The awareness of accounting, corporate, state and national rules and regulations. Tax advantages pay for expenses before it pays taxes a corporation earns, spends everything it can, and is taxed on anything that is left. Vacations are board meetings in Hawaii, Car payments, insurance, repairs are company expenses. Health club membership is a company expense. Most restaurant meals are partial expenses. Corporations are protection from lawsuits.
7) Money is not real. The more real you think money is, the harder you will work for it. If you can grasp the idea that money is not real, you will grow rich faster. The rich make money. Money is what we all agree it is. Shop for houses at the bankruptcy attorney's offices or the courthouse steps. Purchase for low and sell.
8) Two main vehicles to achieve financial growth: real estate and small stocks. If the opportunity is too complex and I do not understand the investment, I don't do it.
9) Have fun, learn from your mistakes, winners are not afraid of losing.
10) Learn and study international trade
11) Learn more than earn. The most important specialized skills are sales and understanding marketing.
12) Overcoming Obstacles fear (of losing money) failure inspires winners and defeats losers, cynicism (winners analyze and see what critics are blind to), laziness (ask - How can I afford it?), bad habits (our lives are a reflection of our habits more than our education pay yourself first), arrogance (is ego plus ignorance start educating yourself)
13) Getting Started
a) I need a reason greater than reality power of spirit.
b) I choose daily the power of choice
c) Choose friends carefully the power of association The reason I want to have rich friends who are close to the inside is because that is where the money is made.
d) Master a formula and then learn a new one You become what you study.
e) Pay yourself first people who have low self-esteem and low tolerance for financial pressure can never, and I mean never, be rich. Each month allocate money to your asset column before they pay their monthly expenses. Have the guts to go against the tide and get rich.
f) Pay your brokers well paying professionals well for their services should make you money. Information is priceless. Your broker should take the time to educate you
g) Assets buy luxuries the power of focus
h) The need for heroes the power of myth. Who are your heroes?
i) Teach and you shall receive the power of giving. I want money, so I give money. I want sales, so I help someone else sell something, and sales come to me. I want contacts and I help someone else get contact, and like magic, contact come to me. First give what you want and it will come back in droves. Often just the process of thinking of what I want, and how I could give what I want to someone else, breaks free a torrent of bounty. Teach and you shall receive. If you want to learn about money, teach it to someone else.
j) To Do's stop doing what you are doing, look for new ideas, take action
Invest in your mind and learn how to acquire assets and you will be choosing wealth as your goal and your future.
5 Statistics/ Quotes/ Comments:
1) The word emotion stands for energy in motion. P. 44
2) Once a person stops searching for information and knowledge of one's self, ignorance sets in. p. 47
3) Intelligence solves problems and produces money. P. 56
4) An intelligent person hires people who are more intelligent than they are. P. 71
5) I strongly urge students to learn to take risks, to be bold, to let their genius convert that fear into power and brilliance. P. 110
6) Great opportunities are not seen with your eyes. They are seen with your mind. P. 125
7) There is always risk so learn how to manage risk instead of avoiding it. P. 127
Was this information helpful?