Want to build wealth and change how you think about money? In this review of “Rich Dad Poor Dad,” we’ll cover six lessons to help you do just that!
“Rich Dad Poor Dad” by Robert Kiyosaki was one of the first finance books I read, recommended by a friend. If you’re wondering whether to read it, the answer is YES! This New York Times bestseller has sold over 40 million copies and has completely transformed my perspective on money.
I want you to experience the same transformation! Whether you aim to reach the net worth of Robert Kiyosaki, Warren Buffett, or Bill Gates, this book offers key lessons to start your journey to wealth. These insights will show you how to attract money and abundance into your life.
I often recommend “Rich Dad Poor Dad” to those new to personal finance. It’s not about complex investment strategies or detailed real estate tactics. Instead, it teaches simple concepts to help you become rich. The book outlines steps to create wealth, make money, get out of debt, and invest in real estate. It will also shift your money mindset, teach you money management, and provide the financial education you need. It’s inspirational and one of my favorite personal finance books.
Here’s my review of “Rich Dad Poor Dad,” including six essential lessons everyone should know:
1. Understand the difference between assets and liabilities. An asset puts money in your pocket, while a liability takes money out. Assets include stocks, bonds, businesses, and rental real estate. Liabilities include cars and your primary residence, as they drain your finances monthly.
2. Use your income to buy more assets. Initially, you might trade time for money, but as you acquire assets that generate income, you’ll rely less on your day job. When your asset income exceeds your expenses, you’re wealthy—not just in money, but in time. You can do what you want while others work.
3. Build a strong financial foundation. Just like a skyscraper needs a solid base, your financial intelligence is the foundation for your wealth. Without it, your financial “skyscraper” will collapse. Invest in your financial education first, and the money will follow.
4. Measure your net worth. To see if you’re keeping enough money, check your net worth or liquid net worth. A solid financial foundation means you won’t feel the urge to spend all your earnings. Use your money to buy freedom, not just things.
5. Avoid the rat race. Spending money on non-income-generating items keeps you stuck. Instead, focus on building assets and managing your money wisely. If you have a job you love, keep it, but if you dream of starting your own business, overcome your fears and go for it! You can start managing your money as a part-time job and enjoy the process.
6. Create multiple income streams. Building a website is an easy way to generate extra income and be your own boss. Monetizing a website can help you start building wealth immediately.
Remember, taxes have historically been designed to make the rich pay more, but the wealthy have found ways to minimize their tax burden through smart investments. Developing your financial IQ is crucial in these areas.
Money is a human-made concept, and understanding this can help you detach emotionally from it, allowing you to create more wealth. Your brain is your greatest asset—keep learning and growing, and your wealth will grow too.
If you haven’t read “Rich Dad Poor Dad” yet, get your copy now! Other recommended personal finance books include “The Richest Man in Babylon,” “The Millionaire Next Door,” “Cashflow Quadrant,” “The 7 Habits of Highly Effective People,” “Secrets of the Millionaire Mind,” and “How to Win Friends and Influence People.”