Lessons from Rich Dad Poor Dad on Financial Freedom
Fear and greed are two emotions that most people use against themselves. The fear of losing a job and money leads them to continue whole life, chasing paychecks and job security. Then the greed of earning more traps them to work harder so that they get more money and get a hike in pay.
The author has compared this situation with a picture of a donkey dragging a cart. And the owner is dangling a carrot in front of its nose.
The donkey’s owner may be going where he wants to, but the donkey follows the carrot placed in front and chasing an illusion.
Tomorrow there will only be another carrot for the donkey. When you are young the candy and the toys, that’s like a carrot to a donkey. As you get older, your toys get more expensive—a new car, a boat, and a big house to impress your friends.
That’s the trap. Fear and ignorance about money control it. Most people never see these opportunities because they’re looking for money and security.
At the age of 9, Robert Kiyosaki understood that he had to do something different to be different. He had two dads. One was his dad, while the other was his friend Mike’s dad. Both men were strong, charismatic, and influential. But they had different opinions, suggestions, advice, and attitude. His own dad eventually became the poor dad, while his friend’s dad made good money and was one of the richest men in Hawaii.
Differences in Opinion and Advice:
Key Lessons from Rich Dad Poor Dad
THE RICH DON’T WORK FOR MONEY
The poor and the middle-class people work for money. They are driven by the emotions of fear and continue chasing money for the rest of their life. Hence, they focus on becoming highly paid slaves.
Instead, they should become financially intelligent and invest their money the right way, and eventually let money work for them.
WHY TEACH FINANCIAL LITERACY?
It’s not how much money you make. It’s how much money you keep.
Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets. An asset puts money in the pocket. A liability takes money out of the pocket. So, financial literacy is imperative for managing and letting your money grow with time.
MIND YOUR OWN BUSINESS
The rich focus on their asset columns and invest their money rightly. They work for themselves and make money that keeps adding their value of assets.
On the other hand, everyone else focuses on their income statements.
They spend their lives minding someone else’s business and making that person rich.
THE HISTORY OF TAXES AND THE POWER OF CORPORATIONS
The rich master the art of saving their taxes and play the game smart. They do it through large corporations— the biggest secret of the rich.
While the poor pay their taxes and don’t look for provisions provided in law that can help them save their hard-earned money.
THE RICH INVENT MONEY
Often in the real world, it’s not the smart who get ahead, but the bold.
Taking a calculative risk can help one to multiple the money made. The rich are smart and bold enough to invest and grow the money. While the poor are fearful to take any such financial risk.
WORK TO LEARN— DON’T WORK FOR MONEY
The poor and the middle-class people only focus on getting a secure job and a regular pay raise. Instead, the priority should be learning.
The rich priority is learning, not money. When you focus on learning the money eventually follows you.
One of the reasons the rich get richer, the poor get poorer, and the middle-class struggles in debt are that the subject of money is taught at home, not in school. Schools focus on scholastic and professional skills, but not on financial skills.
Robert said we are still following the traditional way of teaching our kids. When they grow they have the degree and are referred to as well educated. It’s time people should also focus on being well financially educated. This explains how smart bankers, doctors, and accountants who earned excellent grades may struggle financially all of their lives.
Have a habit of exercising your brain. Proper physical exercise increases your chances for health, and proper mental exercise increases your chances for wealth.
Financial education is powerful.
If you have the education about how money works, you gain power over it and can begin building wealth. Also being able to know when to make quick decisions is an important skill.
A person can be highly educated, professionally successful, and financially illiterate. One should not only know how to make money, but how to manage money. It’s called financial aptitude.
The poor and middle class buy luxuries with their sweat, blood, and children’s inheritance. Financially intelligent people use the income generated from the asset column to buy their luxuries.
If you work for money, you give the power to your employer. You keep working all your lives just to make money for your employer. And if you work for yourself, you make money for yourself. In this case, money works for you, you keep the power and control it.
It’s time you start reflecting on the decision you took. With the financial lessons from the book, you can change the way you were managing your money.
If you are the one who wants to know the secret, you need to pick this book now.
You want to buy your home, start your business, buy a car, or planning your future, this book is all you need.
If you are pondering on early retirement, follow the simple guidance from the book on financial freedom.
Do you have a poor person’s financial programmed mind Or a Rich mindset? Read this book ‘ Rich Dad Poor Dad”, and you will be in bliss.
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