Rich Dad Poor Dad is a great book. I read it recently and it has greatly changed how I look at money.I strongly recommend this book. It has taught me important lessons that I want to share with you. So here we go,
Lesson 1: The Rich people don’t work for money
What? That’s right. The first lesson is quite perplexing indeed. We spend all our lives thinking that the rich always do everything for money and that is true of many rich people but not of the Rich Dad. Rich dad believes that most people spend all their lives thinking that more money will ease their lives but that is not true. To truly become rich (read:financially stable) we need to control two things: fear and greed.
Make money work for you
The fear of not having enough money to pay bills or buy food makes people get out of their bed everyday and do a job that they are not happy doing. A pattern sets in:get up,go to work and pay bills. The problems is that people want to be rich but they aren’t ready to take risks.They are not willing to try something new and think out of the box. A person who’s only looking for money and security will not be able to identify opportunities around him/her.That is why most people are not satisfied with their jobs and are always asking for a raise. They want money,job security, and entitlements. In this way, they stay dependent on others for their finances. But the thing is that employers pay you enough so that you don’t leave. If you want to be rich you need to start thinking about money seriously. The only way to become rich is not to work for money but make money work for you.
Control your emotions and look for opportunities
The poor and the middle class people are not the only ones who are afraid. Many rich people, despite having millions of dollars, are afraid of losing it all and this makes their life terrible. Once we learn to control the fear and desire about money, we are able to think rationally and have greater ease of mind. We also start looking for opportunities around us for making money work for us.
“To spend your life living in fear,never exploring your dreams, is cruel.To live a life dictated by the size of a paycheck is not really living a life.Thinking that a job makes you secure is lying to yourself.That’s cruel and that’s the trap I want you to avoid….Please don’t let money run your life ” (from the book)
Lesson 2: Know your finances
Most people never consciously think about their finances but everyone should be knowledgeable about his/her finances. The author tells us that we should know what are assets and what are our liabilities. Assets are things that put money in our pockets and liabilities are things that take money out of them. The middle class and poor struggle with liabilities and the rich focus on assets. Things like houses, cars, and electronics depreciate with time and these should not be thought of as assets because these are not generating income for you. Instead if we consider a house, you have to pay for its utilities and maintenance. Thus a house is not a asset, it’s a liability.
Lesson 3: Mind your own business
The author asks us to realize that in addition to our day job, we need to hunt for investment opportunities that can help us earn profits.By spending our hard earned money wisely, we can get out of the “rat race”, This is only possible if we keep looking for good deals.However, most people are afraid to take risks but where there are great risks, there is a chance that the return on investment will be huge as well.Basically, the author asks us to become proactive in this field which he calls the greatest game on earth.
Lesson 4: The power of corporations
The rich avoid income taxes through corporations as the taxes on corporations are less than on individuals. In this way, the rich avoid “paying the government”.The author asks us to learn the art through studying accounting, investing, marketing, and the law. He encourages the reader to take courses and seminars. A little investment on these classes can help you a great deal.
Lesson 5: Work to Learn
Identify skills that you need to learn to grow. If you are not a good public speaker, study books, attend seminars and training workshops, and take courses to become better, It’s never too late to start and slowly yet gradually you’ll be able to overcome your weaknesses. It takes grit and perseverance to achieve goals. Just stay focused, believe in yourself, make a plan and go get it.
Lesson 6: Overcome obstacles
Identify weaknesses in your personality that are not letting you achieve your full potential. Work on them and you’ll soo be able to shape your life in a much better way.
I hope you good luck in your future endeavors 🙂