Rich Dad Poor Dad Summary

Rich Dad Poor Dad


Rich Dad Poor Dad, Rich Dad Poor Dad Summary, Summary of Rich Dad Poor Dad
Rich Dad Poor Dad



     
     Everyone has the question in mind that, why only a few people get really rich and why most of the people die living a poor or middle-class life.


     Let’s begin with a story of Robert who had two fathers in which one had a Ph.D. Degree and the other never finished his 8th grade. Both were very smart and hard-working but had very different point of views regarding success and them gave different teachings to Robert.

    
     One said that money is the root of all evil while others said lack of money is the root of evil, one always said we can’t afford expensive things while the other told Robert to find ways that how can he afford it. As that exercises the brain to come up with ideas. One told him to study hard and try to get a job in a big company while the other told him to study hard and try to open his own company and create jobs.

     
     Robert had an advantage as he had 2 Dads and saw both of them grew from his childhood. He used his logic and followed his second Dad's advice who later became the richest man in Miami (Florida). With his teaching, Robert Kiyosaki himself became multi-millionaire, while his  1st Dad kept on struggling financially throughout his life. One of the most important keys for success that Robert got from his Rich Dad was financial literacy, which is knowing the difference between assets and liabilities.


     Now read carefully he gave a really simple definition for them i.e.

“Assets are anything which makes money for you and liabilities are things which take money away from you.”




     The reason rich people are rich they acquire assets while the middle class just buys liabilities.


     E.g. There were two friends Bob and Bill, both working on the same post with the same salary. As soon as they got their salary Bob used to go and buy stuff like the latest cell phone, cool gadgets, branded clothes, shoes, bike or things like that which would make him feel good and rich but he failed to think that these were just liabilities


     As they took his money away from him not just while buying it but also in the future for maintenance etc, even kept losing its value with time and did not return any profit.


     But Bill, did not buy all those things unless it was really necessary. He used to save money and spend it on Assets like Bond Stock, Real Estate or in Developing his own skills, etc, which could generate income for him in the future and make money.


     After, 2 years Bill became Millionaire while Bob kept  on struggling financially and blamed his low salary for the reason of his struggle.


     The cash the flow of poor people goes something like this they get the income and then they have expenses which eat all their income goes into expenditure and liabilities which they think are assets;


    E.g Most of the middle-class people think that the house they own is their asset but that is not true as the house does not put money in their pocket or make money for them, it is just a liability unless they give it for rent. 


     The rich class, on the other hand, spends their income to make assets which in return make money for them and then they mostly spend expenditures from that income. So by doing this they continuously grow and keep getting rich as their sources of income increase. If you really want to get rich let this simple idea fit in your mind. It’s not the amount you earn but the amount you keep.


     You have to shift from a consumer mentality to an Investor Mentality. People keep on complaining that they should get a better income which would improve their life but the problem is even if their income increases, it will just increase their expenditure as high income will make them desire to have a better, better car etc, which again are just liabilities that will keep them away from getting rich and struggle financially.





     So to conclude its not how much money you earn but how you spend it will make all the difference.



     These concepts are taken from Robert Kiyosaki’s book “Rich Dad Poor Dad”. This was the 1st book that I read which change my perspective towards various aspects of life I think you should definitely read it once. 





"In School, we learned that doing mistakes is bad but success is achieved by doing the mistakes."


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