What is rich dad poor dad summary

What is rich dad poor dad summary: For anyone, having a strong financial education is very important to achieve financial freedom. According to many experts, one of the best ways to enhance financial education is by reading books. That’s why there are lots of books worldwide on financial topics. One such book is “Rich Dad Poor Dad” written by American author Robert. Many people read it to guide them towards their goals and success in life.

This book is considered one of the world’s most famous books on financial education. It’s based on the life story of its author, Robert Kiyosaki. In this book, he writes about his two fathers: one is his real dad, whom he calls his “Poor Dad,” and the other is his friend’s dad, whom he refers to as his “Rich Dad.” Interestingly, his “Poor Dad” is his actual father, while his “Rich Dad” is the father of his close friend, and Kiyosaki titles them accordingly in the book. 5 Great Books of the Western World

Rich dad Poor Dad Book Summary

His real dad is highly educated, hardworking, and works as a teacher, but financially, he struggles quite a bit. That’s why in the book, Robert refers to him as his “Poor Dad.” On the other hand, his friend’s dad, although having only an eighth-grade education, is financially very successful, considered the wealthiest and most prominent businessman in their town, all due to his strong financial education. That’s why Robert calls him his “Rich Dad” in the book.

How can I apply these principles to my life?

In this entire story, Robert’s “Rich Dad” imparts six key lessons over 30 years, representing different stages in his life, aimed at achieving success and becoming wealthy. These six lessons, shared by Robert’s “Rich Dad,” are crucial for anyone in the world, regardless of their educational background, to become prosperous and successful. So, let’s delve into discussing the six important lessons outlined by Robert in his book.

The main idea here is that being rich isn’t about working hard for money all your life. It’s about making money work for you. See, most people get stuck in a routine where they study hard, find a job, get married, and spend their lives paying off debts using their salary. Even though they work really hard, the rewards often benefit someone else. Many feel trapped in this cycle but continue because of fears, desires, and responsibilities. The key is to break free from this cycle and find ways where your money starts working for you, rather than you just working for money. It’s like saying, “Make your money work for you.” That’s the goal!

Lesson number two is all about understanding that it’s more important to hold onto the money you have than just focusing on making more. Take a look around the world, and you’ll see famous people like athletes or stars who were once super rich but now have very little left. Why does this happen? It’s because they lack knowledge about how to handle and grow their money. See, “Rich Dad” explains that most people think a house is an asset, but according to him, it’s not always the case.

He says an asset should bring in more money over time, but a house often means years of paying off loans, where money just goes out, not in. For “Rich Dad,” an asset is something that earns you money while you relax at home. So, getting rich isn’t just about making money; it’s about learning how to manage and reuse that money wisely.

Let’s simplify that! When people find a job they love, they often stick to it for life without considering anything else. Many believe they can’t do another job or start a business while having their regular job. But look at Ray Kroc, who started McDonald’s. People might think he made money from selling burgers, but his real success was in real estate. While growing McDonald’s, he became a huge real estate owner.

So, alongside his burger business, he built a real estate empire that made him really rich. He showed that while doing a job, you can also create other ways to earn money, like starting a business, investing in stocks, putting money in real estate, or buying properties that bring in profits. Following any of these methods can create a new income source. “Rich Dad” advises this because it’s the way to truly become wealthy. This applies to everyone, regardless of their financial situation.

In lesson number four, Rich Dad talks about taxes. He says taxes were initially meant to bridge the gap between the rich and the poor. At first, only wealthy people paid taxes, and that money was used to help the less fortunate. But over time, even the middle and upper-middle class started paying taxes. Today, things are different.

Rich folks cleverly find ways to avoid paying hefty taxes by using their intelligence and strategies. Surprisingly, most taxes collected now come from the middle and upper-middle class. The big, rich businesspeople earn money first, spend a lot fulfilling their desires, and then pay taxes from whatever remains. Meanwhile, the middle and upper-middle class pay taxes as they earn, and whatever little they save, they spend it on themselves.

Lesson number five is about “Rich Invent Money.” It talks about successful people like Jeff Bezos, Bill Gates, Mark Zuckerberg, and in India, people like Dhirubhai Ambani, Shiv Nadar, and Azim Premji. These individuals brought new business ideas or concepts into the world that no one had thought of before. They took their revolutionary ideas and invested money in them.

Before anyone else could seize the opportunity, they explored it and took immediate action. That’s why it’s said they didn’t just earn money; they invented it because they introduced things to the world that didn’t exist before. So, it’s not just about making money; it’s also about thinking of ways to invest your money.

Lesson number six talks about how some people in the US make really good burgers that are even better than McDonald’s burgers, but they struggle to sell them widely. Even though their burgers are great, they only sell them in a small area or in limited amounts, unlike others who sell their burgers worldwide without any limits. This lesson teaches us that successful people, no matter how rich they are, keep learning new things and new ways to sell their product or idea to a larger audience. This habit helps them figure out how to present their product or idea to a bigger market.

Can you recommend any other books on personal finance?

These are some great books that can help you manage your money better:

  1. The Millionaire Next Door: It talks about how regular people become millionaires and what they do with their money.
  2. The Total Money Makeover: This one gives you a step-by-step plan to get rid of debt, save money, and invest wisely.
  3. Your Money or Your Life: It’s about how money connects to your life’s purpose and gives a more holistic approach to handling finances.
  4. The Simple Path to Wealth:
  5. The Bogleheads’ Guide to Investing: This is a complete guide to investing in index funds, following the ideas of John C. Bogle, who founded Vanguard.
  6. The Psychology of Money: It looks at how our thoughts and emotions affect our money decisions.
  7. The Richest Man in Babylon: A classic guide with timeless advice on saving, investing, and growing your wealth.

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