Robert T. Kiyosaki had two dads. A rich one and a poor one. In reality, his so-called rich dad was Richard Wassman Kimi.
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Rather than find out how people like Mitt Romney and President Donald Trump pay less in taxes legally, the poor an middle class get angry.
A job is really a short-term solution to a long-term problem.
Do not say "I cannot afford it," but ask yourself "how can I afford it?"
"One dad recommended, 'Study hard so you can find a good company to work for.' The other recommended, 'Study hard so you can find a good company to buy.'"
"One said, 'When it comes to money, play it safe. Don't take risks.' The other said, 'Learn to manage risk.'"
"One believed, 'Our home is our largest investment and our greatest asset.' The other believed, 'My house is a liability, and if your house is your largest investment, you're in trouble.'"
"Two roads diverged in a wood, and I — I took the one less traveled by, And that has made all the difference."
"The poor and the middle class work for money. The rich have money work for them."
"Once a person stops searching for information and self-knowledge, ignorance sets in."
"History proves that great civilizations collapse when the gap between the haves and have-nots is too great."
"We only memorize historical dates and names, not the lesson."
"(People) do as their parents did. They get up every day and go work for money, not taking the time to ask the question, 'Is there another way?'"
"When emotion goes up, intelligence goes down."
"He talked about the gold standard that America was on, and that each dollar bill was actually a silver certificate. What concerned him was the rumor that we would someday go off the gold standard and our dollars would no longer be backed by something tangible. 'If that happens, boys, all hell will break loose. The poor, the middle class, and the ignorant will have their lives ruined simply because they will continue to believe that money is real and that the company they work for, or the government, will look after them.'"
"It's not how much money you make. It's how much money you keep."
"In 1994, I retired. I was 47, and my wife Kim was 37. Retirement does not mean not working. For us, it means that, barring unforeseen cataclysmic changes, we can work or not work, and our wealth grows automatically, staying ahead of inflation. Our assets are large enough to grow by themselves. It's like planting a tree. You water it for years, and then one day it doesn't need you anymore. Its roots are implanted deep enough. Then the tree provides shade for your enjoyment."
"Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets."
"An asset puts money in my pocket. A liability takes money out of my pocket."
"If you want to be rich, this is all you need to know. It is rule number one. It is the onle rule. This may sound absurdly simple, but most people have no idea how profound this rule is. Most people struggle financially because they do not know the difference between an asset and a liability."
"If you want to be rich, simply spend your life buying or building assets. If you want to be poor or middle class, spend your life buying liabilities."
"Cash flow tells the story of how a person handles money."
"Based on 2016 stats, U.S. consumer credit card debt is at an all-time high: $779 billion. Is it all bad debt... or good debt? Do you know the difference?"
"If you find you have dug yourself into a hole... stop digging."
"Concentrate your efforts on buying income-generating assets."
"Wealth is a person’s ability to survive so many number of days forward — or, if I stopped working today, how long could I survive?" (R. Buckminster Fuller)
"The rich buy assets. The poor only have expenses. The middle class buy liabilities they think are assets."
"It is secret number three of the rich. That secret is: Mind your own business. Financial struggle is often directly the result of people working all their lives for someone else. Many people will simply have nothing at the end of their working days to show for their efforts."
"Often, I ask people, 'What is your business?' And they will say, 'Oh, I'm a banker.' Then I ask them if they own the bank. And they usually respond, 'No, I work there.' In that instance, they have confused their profession with their business."
"The mistake in becoming what you study is that too many people forget to mind their own business. They spend their lives minding someone else's business and making that person rich."
"Real assets fall into the following categories:
- Business that do not require my presence
- Income-generating real estate
- Notes (IOUs)
- Royalties from intellectual property such as music, scripts, and patents
- Anything else that has value, produces income or appreciates, and has a ready market."
"Start minding your own business. Keep your daytime job, but start buying real assets, not liabilities."
"With small companies, my investment strategy is to be out of the stock in a year. On the other hand, my real estate strategy is to start small and keep trading up for bigger properties and, therefore, delay paying taxes on the gain. This allows the value to increase dramatically. I generally hold real estate less than seven years."
"Nine out of ten companies fail in five years. Of those that survive the first five years, nine out of every ten of those eventually fail as well."
"Once a dollar goes into it, never let it come out. Think of it this way: Once a dollar goes into your asset column, it becomes your employee. The best thing about money is that it works 24 hours a day and can work for generations. Keep your day job, be a great hardworking employee, but keep building that asset column."
"The poor and middle class buy luxuries with their own seat, blood, and children's inheritance."
"A true luxury is a reward for investing in and developing a real asset."
"My rich dad just played the game smart, and he did it through corporations — the biggest secret of the rich."
"My rich dad dit not see Robin Hood as a hero. He called Robin Hood a crook."
"The reality is that the rich are not taxed. It's the middle class, especially the educated upper-income middle class, who pays for the poor."
"A corporation is merely a file folder with some legal documents in it, sitting in some attorney's office and registered with a state government agency. It's not a big building or a factory or a group of people. A corporation is merely a legal document that creates a legal body without a soul."
"Average Americans today work four to five months for the government just to cover their taxes. In my opinion, that is simply too long. The harder you work, the more you pay the government. That is why I believe that the idea of the "take-from-the-rich" backfired on the very people who voted it in.
Every time people try to punish the rich, the rich don't simply comply. They react. They have the money, power, and intent to change things. They don't just sit there and voluntarily pay more taxes. Instead, they search for ways to minimize their tax burden. They hire smart attorneys and accountants, and persuade politicians to change laws or create legal loopholes. They use their resources to effect change.
The Tax Code of the United States also allows other ways to reduce taxes. Most of these vehicles are available to anyone, but it is the rich who find them because they are minding their own business. For example, "1031" is jargon for Section 1031 of the Internal Revenue Code which allows a seller to delay paying taxes on a piece of real estate that is sold for a capital gain through an exchange for a more expensive piece of real estate. Real estate is one investment vehicle that has a great tax advantage. As long as you keep trading up in value, you will not be taxes on the gains until you liquidate. People who don't take advantage of these legal tax savings are missing a great opportunity to build their asset columns."
"Rich dad constantly reminded Mike and me that the biggest bully was not the boss or the supervisor, but the tax man. The tax man will always take more if you let him."
"He knew the law because he was a law-abiding citizen and because it was expensive to not know the law."
"My highly educated dad (...) spoke of the virtues of 'working your way up the corporate ladder.' When I told my rich dad of my father's advice, he only chuckled. 'Why not own the ladder?' was all he said."
"Without this financial knowledge, which I call financial intelligence or financial IQ, my road to financial independence would have been much more difficult."
"A corporate can do many things that an employee cannot, like pay expenses before paying taxes. Employees earn and get taxed, and they try to live on what is left. A corporation earns, spends everything it can, and is taxed on anything that is left. It's one of the biggest legal tax loopholes that the rich use. They're easy to set up and are not expensive if you own investments that are producing good cashflow. For example, by owning your own corporation, your vacations can be board meetings in Hawaii. Car payments, insurance, repairs, and health-club memberships are company expenses. Most restaurant meals are partial expenses, and on and on. But it's done legally with pre-tax dollars."
"Often in the real world, it's not the smart who get ahead, but the bold."
"In my personal experience, your financial genius requires both technical knowledge as well as courage."
"Land was wealth 300 years ago. (...) Later, wealth was in factories and production. (...) Today, wealth is information."
"The poor and middle class work for money. (...) The rich make money." (Rich dad)
"There is always risk, so learn to manage risk instead of avoiding it."
"Job security meant everything to my educated dad. Learning meant everything to my rich dad."
ADD MY REVIEW
|| Conceptually great, lacks a concrete blueprint
By Jack Anderson on October 4, 2018
This is a conceptual book. And it is very good in that particular aspect. Unfortunately, you won’t find any investment formula. It is more a framework for the mind than a detailed blueprint to accumulate wealth.
A GREAT CONCEPT
Still, the book is really excellent and I shouldn’t start with a negative. Author Robert T. Kiyosaki’s overall idea is extremely good, and I don’t think he sold 40 million copies becaue of chance. Kiyosaki knows how to sell. And the concept of a kid learning about finance through two dads, a rich one and a poor one - that he usually refers as his educated dad, is truly great. It really resonates with me and I am the result of a (very) poor dad. Unfortunately, I never had a rich dad like the author had (a friend’s father that became a father figure for him). Therefore, I had to learn myself. But still, I think that you can learn a lot by seeing what the poor people are doing - or not doing. I remember this quote, from another book, who said that if you wanted to become rich, you should spend your time looking for and getting to know rich people. And if you wanted to become a bum, you should look for and get to know homeless people. I exaggerate, but you get the point. Here, Kiyosaki has the opportunity to compare in details the come and go of two people that were thinking drastically different.
At the end of each chapter, there is a summary, as if the reader is too stupid to get the point of each chapter or too lazy to read the entire chapter (chances are it’s for the latter.) I think the book would have been better without those summaries that add no value whatsoever.
But my summary is that the book is very good, with lots of out of the box reflexions. I give it 6 out of 10. Very good.