Good Book Review About Rich Dad, Poor Dad

Type of paper: Book Review

Topic: Money, Wealth, Finance, Wellness, Literature, Poor, Poverty, Business

Pages: 3

Words: 825

Published: 2020/12/03

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Rich Dad, Poor Dad by Robert Kiyosaki is an excellent book on acquiring personal wealth and becoming wealthy in a manner that will last. It is interesting in that the book does not provide steps, or investment strategies, or other get rich schemes. Kiyosaki does quite the opposite. His book and his lessons intend to impart on the readers life lessons on money, wealth, and being wealthy. Rich Dad, Poor Dad offers sound advice and attempts to teach rather than lead the reader into making money. This paper analyses the book and looks at the key elements expressed by Robert Kiyosaki, his philosophy of the accumulation of wealth, and my personal list of how I intend to accumulate wealth.
The key elements expressed by Robert Kiyosaki in his book Rich Dad, Poor Dad are the wealthy do not work for money, the significance of financial literacy, minding your own business, taxes and corporations, inventing money, and finally the need to work in order to learn instead of working for money. Kiyosaki in his book, separates people into essentially three classes: the rich, the middle-class, and the poor. The main difference between the classes is that the rich do not work for money, they let money work for them. The middle-class usually counts their liabilities as assets, for example, a middle-class person would count their house as an asset and not the liability that it is. And finally, the poor person works hard for money and spends it on luxuries. The poor person will always be poor, even if the poor person makes more money, because his expenses will increase in relation to the money. The main point of this lesson is that the rich get their money to “work for them” in that the money they have keeps making them money. They invest in assets, instead of liabilities, and in turn keep positive cash flow. Next, Kiyosaki talks about the importance in becoming financially literate. People must understand money and how it works. At the very least, a person must be able to look at financial statements and be able to read them. Next, Kiyosaki imparts the lesson of minding your own business. This means that instead of working for someone, the rich end up creating their own business. The rich person uses this business to acquire wealth. Corporations and taxes as discussed by the book are interestingly seen as loopholes by the author. An individual will usually pay taxes first, and then they pay their own expenses. This usually comes in the form of income tax withheld, the government takes this money and makes money of it. Corporations on the other hand are able to pay for their expenses, and whatever is left is taxed. Kiyosaki says that in order to be rich, one must invest in corporations or create corporations in order to take advantage of this loophole. The corporation pays less in taxes than the individual. The rich also invent money, in that they are manage their fear and doubt and take it to making money. The poor are dominated by the fear of not having enough money and do not take advantage of the situations and opportunities they are afforded. As the author had a career in the Marines before becoming a real estate mogul, he was able to learn. He describe this as working to learn, instead of working for money. This means that in order to be rich, the individual has to gain experience and take chances, and all the jobs that one gets, one must take this to heart and learn. The lessons and experience can then be applied to making money.
The philosophy of accumulating wealth in this book is very simple. It is simply buying assets instead of liabilities. It talks about investing in assets that will make you money, instead of investing in luxuries or liabilities that will make you poor. It hints at not spending more than you earn, and trying to limit yourself to your lifestyle before your pay increase. In that, the individual must not spend more than he earns. And an increase in pay does not mean an increase in lifestyle expenditures. Instead, an increase in pay must mean that the individual spends this increase of wealth into assets which in turn will make the person wealthier. The book attempts to teach the reader that he or she must learn to think like a rich person and that will in turn lead to the person acting like a rich person. This avoids the fallacies that come with thinking and acting like a poor person. I agree with Kiyosaki’s philosophy, no matter how simple it is. It is important to buy assets that make you money, that is a given. But a person will never become rich working for a company. This is because the company is becoming rich off of you, instead, you either invest in companies, building companies, or mind your business in order to acquire great amounts of wealth. Even on a smaller scale, just from a normal person’s point of view, it is important not to spend more than you make. And it is unwise to increase spending when you get a pay raise because this only keeps you at the same cash flow as before, you will never be happy or acquire wealth this way.
My personal list for accumulating wealth is as follows. Firstly, I will ensure that I have a budget, in that my current lifestyle will be maintained and my cash flow will be positive. Secondly, I will invest in stocks, bonds, mutual funds, trusts, and real-estate with my money so that the asset column in my life will continue to grow. When I get pay increases, I will maybe increase my spending a little, but the rest will go into saving and investing in order to grow my assets. I will then build my credit, my reputation, and my trustworthiness with money in order to get loans from banks. These loans will allow me to invest in real-estate, as these loans are the easiest to get from banks. I will not invest in my house, instead, I will count it as a liability and instead look for more productive ways to spend my money. Hopefully this list will help me accumulate wealth and one day be like rich dad.
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WePapers. (2020, December, 03) Good Book Review About Rich Dad, Poor Dad. Retrieved October 19, 2021, from https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/
"Good Book Review About Rich Dad, Poor Dad." WePapers, 03 Dec. 2020, https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/. Accessed 19 October 2021.
WePapers. 2020. Good Book Review About Rich Dad, Poor Dad., viewed October 19 2021, <https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/>
WePapers. Good Book Review About Rich Dad, Poor Dad. [Internet]. December 2020. [Accessed October 19, 2021]. Available from: https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/
"Good Book Review About Rich Dad, Poor Dad." WePapers, Dec 03, 2020. Accessed October 19, 2021. https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/
WePapers. 2020. "Good Book Review About Rich Dad, Poor Dad." Free Essay Examples - WePapers.com. Retrieved October 19, 2021. (https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/).
"Good Book Review About Rich Dad, Poor Dad," Free Essay Examples - WePapers.com, 03-Dec-2020. [Online]. Available: https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/. [Accessed: 19-Oct-2021].
Good Book Review About Rich Dad, Poor Dad. Free Essay Examples - WePapers.com. https://www.wepapers.com/samples/good-book-review-about-rich-dad-poor-dad/. Published Dec 03, 2020. Accessed October 19, 2021.
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