Rich Dad Poor Dad - key lessons

Author: Maria Chzhen

Date: 3 April 2020

The rich don't work for money. They make money work for them.

Today, I am going to talk about a book called Rich Dad Poor Dad by Robert Kiyosaki. Although the book may not sound very intriguing at first, it may as well be one of the most helpful you can read.

What is Rich Dad Poor Dad about, and why do I speak so kindly of it?

The book is about money. It uncovers the greatest secrets that the rich people teach their kids about. I was lucky enough to discover the book earlier in my life, but remember: it's never too late to begin your journey out of the Rat Race! But let's go in order.

One of the most common words Robert Kiyosaki uses is "The Rat Race" in the book is the normal life of a middle class citizen. This citizen, he or she, pays off their mortgage and taxes monthly and works hard every day for a company. However, this person is always behind. They don't have much money left over for themselves or their kids - they have just enough to get by without starving or feeling very bad. Whenever this citizen gets a paycheck, they spend it on unnecessary luxuries (liabilities), and not on personal finance education or assets. This is what the Rat Race feels like. Did you recognize yourself? You work hard all your life, making your employer rich. That doesn't sound very nice, does it?

Kiyosaki explains that the Rat Race is created because by the end of school kids aren't properly taught how to manage their money. The government trusts that the parents will teach their kids how to make and manage money. But how can middle-class parents teach their kids to be rich if they themselves aren't rich? It's like me teaching people how to speak Italian, although I have no idea how to do that. And this, ladies and gentlemen, is how we get people who think that investment and stock risks are never worth investing in, who think that the most important thing in the world is to climb the corporate ladder, and who think that the evil rich and the salespeople are the ones to blame for everything. In the book, Kiyosaki (who is a successful investor and millionnaire that experienced several downfalls throughout his life but always managed to climb back to being a millionnaire!) talks about 6 lessons that his rich dad, the wealthy dad of his friend Mike, has taught him, and how they compare to the lessons his biological dad has taught him.

Robert Kiyosaki with Donald Trump

Criticism

I agree, Kiyosaki didn't paint his dad in the best way possible. Calling your biological dad "poor dad" and "educated dad" throughout the book... I can't imagine my dad's reaction if I only mentioned him in the book by the nickname of "poor dad", and said how bad and wrong all of his financial lessons were to me.

Did the Rich Dad ever exist?

The bigger question critics have is: "Did the rich dad exist?". There are speculations and theories floating around about that. Let's take a look at some of them:

Some people believe that by "rich dad", Robert Kiyosaki meant one of the best investors he met and learnt from in his life, not just a father of his classmate's.

This would make sense. If Kiyosaki did learn from a professional that has achieved success in a certain area of expertise, it would make sense for him to refer to that businessman as a "rich dad", a close person who guided and helped him out.

Another theory states (quite obviously) that the rich dad did exist.

This is pretty straightforward. If the rich dad existed, and he was, indeed, the father of one of Kiyosaki's classmates, why wouldn't the author refer to him as his "rich dad", metaphorically.

The third theory is about Kiyosaki being a con-artist who didn't have neither the rich dad, nor the poor dad.

This speculation is somewhat darker: the theory about Robert Kiyosaki not being an investor, and only rising to fame because of his books, and noe because of his investing books. The theorists try to justify their findings by saying that Kiyosaki went broke a few times in his life. I, personally, don't believe in such theories and speculations, but I will let you, my valuable reader, decide for yourself

Main idea of the book

The most important lesson in the book, in my opinion, is that the rich don't work for money. This is the ultimate lesson of the book. They outsmart money and make it work for them. They set up systems made of real estate, stocks, bonds and corporations. There is no point in blaming them or any other people in the finance businesses because they outsmart the system. We should all ask them what their secrets, tips and tricks are instead. The other lessons kind of had the same or similar point.

I certainly recommend reading this book. It may not be the best book in finance for accounting professionals and MBAs out there, but it is definitely a good place to start. A solid 7 out of 10!