Wednesday, November 11, 2009

Rich Dad Poor Dad - Robert Kiyosaki & Sharon Lechter

Several interesting ideas in this book.

 

I don't work for money. Money works for me.

 

Never say - "I can't afford it". Say - "How can I afford it?"

 

Money is one form of power. What is more powerful is financial education. Money  comes and goes, but if you have the education about how money works, you gain power over it and begin building wealth.

 

6 lessons:

 

    The rich don't work for money

    Why teach financial literacy

    Mind your own business

    The history of taxes and the power of corporations

    The rich invent money

    Work to learn - don't work for money

 

The rich don't work for money

 

The main cause for poverty or financial struggle is fear and ignorance, not the government, not the economy or the rich. Its self inflicted fear and ignorance that keeps people trapped.

 

We had learned to have money work for us. By not getting paid for work at the store, we were forced to use our imaginations to identify opportunities to make money. By starting our own business, the comic book library, we were in control of our own finances, not dependant on an employer. The best part was that our business generated money for us, even when we were not physically there. Our money worked for us.

 

Why teach financial literacy?

 

The rich buy assets. The poor only have expenses. The middle class buy liabilities they think are assets.

 

Mind your own business

 

We spend our lifetimes minding someone else's business and making them rich.

 

Maintain your day job and start collecting assets. Real assets fall in several categories.

Businesses that do not require my presence. I own them, but they are managed and run by other people. If I have to work there, it is not a business. It becomes a job

    Stocks

    Bonds

    Mutual Funds

    Income generating real estate

    Notes (IOUs)

    Royalties from intellectual properties

    Anything else that has a value, produces income or appreciates and has a ready market

 

Rich make money when the deal is made.

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