On Being Rich and Starting afresh

Book Review: Rich Dad, Poor Dad

When I read Rich Dad, Poor Dad, I thought it was very ahead of its time. It came out in a time when there were no talks of start-ups and talks about entrepreneurship.  It can be viewed as a general starting point — a investment/startup summary.

There are certain things so apt about Robert’s analysis of the entire ‘making money’ part that I had to write them down. Throughout the book, the author compares both the fathers through their financial practices, ideas and dealing with money and in the end, which of the two father’s insights will prove beneficial in the long run for.

He tells us that even though people work hard, they are unable to earn the adequate amount to spend and save – both at the same time.

Financial Literacy

Our traditional educational system is flawed. Our education system is designed primarily to create employees and could be a negative influence for an entrepreneur.  people are given education about everything except education about money. He says “people learn to work for money … but never learn to have money work for them.”

Here in Nigeria, we can definitely relate to it. The system does not encourage us to try new things or pursue a career that is not driven by the education you take but the skills you possess. So, we have to learn the art of financial literacy and the ‘street smart’ attitude one needs to start something new.

And to start something, the time is now, here.

Mind Your Own Business

Poor and middle class work for money. Rich people made money work for them. He emphasizes that while you are working for someone, make sure you learn the art of working on your own. Once you have learnt the art of making money, use it on your own business.

Think about your present situation in the light of your future. If you keep on doing what you are doing since quite some time, you will get the same results what you are getting. To get new results, do something different.

Work for Experience not for Money

Learn from lessons of successful people. Learn how to manage risk. An Investment is not risky. Not knowing how to manage an investment is risky.

Learn the business where you do your job so that you can start your own business later. 

Make Assets not Liability

The author also states that there are many people who do not understand the difference between an asset, i.e. something that gives money in return and a liability, i.e. something which requires giving away money. Kiyosaki’s point is that a person should focus on increasing the income by generating assets which can rather be spent on paying expenses.

Through his “poor dads” experiences, he mentions “Rich people acquire assets. The poor and middle class acquire liabilities, but they think they are assets”.

“You must know the difference between an asset and a liability, and buy asset.” Try to invest in real estate when market is down. Make offers. Don’t sit and wait for opportunity to come

“If you work for money, you give the power to your employer. If your money works for you, you keep and control the power.” This quote sums up practically everything that Kiyosaki has to say about starting your own venture.

In Nigeria many people are starting new ventures and I will recommend this for people who have just stepped into the world of entrepreneurship. It should be read so that they can think differently and not just rely on education.