Disclaimer: Everything in this article is taken from the Rich Dad Poor Dad book, either directly or paraphrased. All credits go to Robert Kiyosaki. Amazing read!
Press enter or click to view image in full size
ONE
The rich don’t work for money, they have money work for them
Let life push you around
It’s easier to change yourself than change everyone else
The poor and middle class pay more in taxes than the rich
A job is a short-term solution to a long-term problem
Human life is a struggle between ignorance and illumination
Use your emotions to think, don’t think with your emotions
By not getting paid, you use your imagination to find ways to make money
TWO
Why teach financial literacy?
It’s like planting a tree. You water it for years and then one day it doesn’t need you anymore. The roots are planted deep enough and it provides shade for your enjoyment.
Intelligence solves problems and produces money.
Buy assets and not liabilities
The Japanese are aware of 3 powers: the sword, the jewel, and the mirror
Power of weapons, power of money, and power of self-knowledge
An intelligent person hires people who are more intelligent than he is
When it comes to money, high emotions tend to lower financial intelligence
Owning a house — loss of time, capital, and education
Wealth measures your financial survivability
THREE
Mind your own business
There is a difference between your profession and your business
Net worth is often less than what it seems due to taxes on gains
Assets include businesses run by others, stocks, bonds, real estate, royalties, etc
True luxury is a reward for investing and developing a real asset
FOUR
The history of taxes and the power of corporations
The rich use corporations to limit the loss of investments
A corporation is a legal document that creates a legal body without a soul
Income tax rate is lower for corporations + certain expenses can be paid with pre-tax income
Real estate — as long as you keep trading up in value, you will not be taxed for the gains until you liquidate
If you work for money, you give all the power to your employer. If your money works for you, you keep the power and control it
Accounting — ability to read numbers
Investing — letting your money make money
Markets — supply, and demand
Understanding the law can give you tax advantages and protection from lawsuits under a corporation
FIVE
The rich invent money
In the real world, your “balls” matter more than your college grades
Often in the real world, it is not the smart who get ahead but the bold
People who get out of the rat race the quickest are the ones who understand numbers and have creative financial minds
Money is not real, the single most powerful asset that we have is our mind
Being financially intelligent will allow you to see the opportunities when they appear
The problem with secure investments is that they are often so sanitized that the gains are little
Plant seeds in the asset column. Start small; some grow and some don’t
It’s not gambling if you know what you are doing
Great opportunities are not seen with your eyes, they are seen with your mind
People who avoid failure, also avoid success
Two types of investors — the ones who buy a package and those that assemble the package
To be the second type of investor
Find an opportunity that everyone else missed
Raise money
Organize smart people
It is what you know that is your greatest wealth. It is what you do not know that is your greatest risk
SIX
Work to learn — don’t work for money
Learn to sell — you have best-selling authors, not best-writing authors
Know a little about a lot
Seek work for what you will learn more than what you will earn
Education is more valuable than money, in the long run
If you do become highly specialized, seek union protection
Management skills needed
Management of cash flow
Management of systems
Management of people
The skills of selling and marketing are one of the most important
Most important law of money: Give, and you shall receive
SEVEN
Overcoming obstacles
The primary difference between a rich and a poor person is how they manage the fear of losing
“If you hate risk and worry, start early”
For winners, losing inspire them. For losers, losing defeats them
FOCUS: Follow One Course Until Successful
Doubt is expensive
There is a little chicken inside every one of us
A great property manager is the key to success in real estate
People should learn how a stop loss works — automatically sell your stocks if the price drops below a certain point to help you minimize your losses
Fry your little chicken
Say “How can I afford it”, instead of “I can’t afford it”
How do you beat laziness? A little greed
If I pay myself first, I get stronger, mentally and fiscally
You will figure out how to pay the bill collectors because you have to
When you are ignorant in a subject, start educating yourself
EIGHT
Getting Started
Without a strong reason or purpose, anything in life is hard. Find a reason that keeps you going
Choose wisely. Choose to feed your mind with good things and grow it, it is your most real asset. Make good choices daily
Choose your friends wisely. Learn from them, both the financially intelligent and the unintelligent but don’t let their chicken little scare you. Learn from the rich about how to make money
You become what you study. Study faster to find faster formulas to build wealth. Working hard for money is an old formula
To get rich, you need self-discipline. Study the management of cash flow, people, and time to run a business.
Don’t get into debt in the first place
Pay yourself first, let your creditors and the IRS motivate you but don’t give in and liquidate your stocks or use your savings
A good broker should provide you with information. Information is priceless
A good broker should educate you and save you time, they are your eyes and ears in the market
Hire professionals that mind their own business
For every investment, there must be an upside (assets you get for free) and low risk
Let your assets buy you luxuries
Find heroes. They make it look easy and if they can do it, then so can you
Give what you want first and it will come back to you in buckets. Teach and you shall receive
NINE
Some To-Dos
Stop doing what is not working and look for something new
Look for new ideas
Look for someone who has done what you want to do
Take classes, read and attend seminars
Make lots of offers, someone might say yes
Get around your area for 10 minutes a month — look for changes
Shop for bargains
Profit is made when buying not selling
Look for people who want to buy. Then look for people that are selling
Think big, act big
Action always beats inaction
Final notes
3 types of income — earned, passive, and portfolio
Earned income is money you work for
Passive and portfolio income is money working for you
