top of page
Dwight C.

Rich Dad Poor Dad by Robert T. Kiyosaki - Book Review

Updated: Oct 12, 2020



Rich Dad Poor Dad What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not! By Robert T. Kiyosaki


Main lesson of the book: How to escape the rat race


There are a few books out here in this world that can complete change your point of view. Rich Dad Poor Dad is one of them. I am sure that most of us have been embedded with the concept of “Go to school, Get a good job, Get promoted, Retire”. And I have to be honest, for the longest time I saw nothing wrong with this way of life. Everyone around me was on that path, my parents were on that path and thus pushed me to be on the same path. It seemed to be the way society functions. With this in mind I never gave up on the concept of school and made it my main source of education. I was able to get 2 Bachelor degrees with international experience in a business and marketing related field. Now one would think that with those 2 degrees the next step should be pretty easy, which is to get a job. After 200+ rejections I started to get extremely depressed. At first my rage and depression stemmed from the fact that I kept being rejected for positions that were either beneath my educational level or matched it perfectly. But now I know that part of my frustration was born from the fact that I wasn’t able to progress further in the steps set out by society. Which made me feel worthless in the eyes of a world that values productivity.


I was never taught that there are other options out there. And that is what Rich Dad Poor Dad focuses on. Telling us that there is another option available for those who are willing to look. The book focuses on an amazing array of topics that range from understanding money to the different mind states of the rich and poor. One of the biggest differences the book states between the rich and poor is that the poor pay themselves last while the rich pay themselves first. Meaning that the poor will make sure all their bills are paid and then with what’s left deal with life. While the rich pay their bills last and use a part of their money to increase their assets. And with what’s left they pay their bills and if they come up short, they have to think of a way to make more money.


Now this might seem weird to most but it opened my eyes in a pretty interesting way. Rich Dad Poor Dad really puts a lot of emphasis on the concept of “Financial IQ”. By paying yourself first and putting yourself into a tight spot financially, you are forcing yourself to think of how you can make more money. The more you think, the more ideas will pop up, the more you think the better your financial IQ will be. Essentially, you’re training your brain to think of money as a problem to solve while investing it into your future. By doing this I can learn how to make sure that my assets grow while maintaining my standard of life. I have to admit that this isn’t for everyone. Because it comes with the understanding that you will have to work extra hard to make sure you can pay for everything while there might be no direct benefits. And the fact that there are no direct benefits will most likely irk a few people. Which is understandable but your financial future will not improve by ignoring it. That is one of the main lessons of the book.


Another amazing lesson that made me smile from ear to ear is this: Buying a house is not an asset. That line upsets a lot of people. But to really understand what it means we will have to look at how Rich Dad Poor Dad defines Assets and Liabilities. The standard definition of Assets is” items on a balance sheet showing the book value of property owned”, and the definition of liability is “a company's legal financial debts or obligations that arise during the course of business operations.” But Rich Dad Poor Dad defines it as Assets make money, Liabilities cost money. This made so much sense to me that I smiled from ear to ear. I had accounting in my high school days but I don’t remember all that much from it. But I do know that this definition isn’t one that is taught in school. But it made my heart beat faster and gave me a headache at the same time. Because it was right then and there that I realized I had no assets. My liabilities were luckily also extremely low, but the fact that I had no assets really hurt me. For years I thought I was doing ok in life and that once I reach the winter of my life everything will be fine. But that one line made me realize that I have been neglecting my financial IQ and financial future.


Rich Dad Poor Dad is all about understanding that your future is your own and that we live in a world where you’re taught to work hard for a company, climb the corporate ladder and build up a nice pension fund. That exact same world will also try to take all your money or shortchange you as you grow older. So to make sure that you will be ok in the years to come, you will need to increase your assets column. The only way one can effectively leave the rat race is by hard work on improving his or hers financial IQ and building their assets. This means that their money will work for them and they will not be dependent on a paycheck which will only cover their bills, taxes and if lucky food. By having your money work for you, you are taking control of your freedom, your life, your dreams and your chances. All of this sounds really simple and self-explanatory but the way Rich Dad Poor Dad explains it and puts it right in front of you is something else.


The chapter that really made me nod along as I read was chapter 6. This chapter is called “Work to Learn—Don’t Work for Money”. Even before I read Rich Dad Poor Dad I was never motivated by money because I thought that money wasn’t important. Money wasn’t necessary for me to be happy. Money was nothing but a tool and should never be the end goal. Chapter 6 agreed with me on the point that I should never work for money but always try to learn more about the world and expand my knowledge. The big difference between my mind set and that of Rich Dad Poor Dad is that I collected knowledge for the sake of collecting it. But Rich Dad Poor Dad really made it clear that all the knowledge I have gathered can be used to increase my financial IQ and my assets column. Instead of just sitting in a dusty corner of my mind. This chapter really showed me that understanding how to manage your cashflow and people can help you to grow both mentally as well as financially. I’m a little late to the party but one of the reasons I started writing this book is because of Rich Dad Poor Dad and how it showed me that I am lacking in my financial intelligence.


Rich Dad Poor Dad is filled with an amazing amount of quotes that can change your life. But there is one that made me change my definition of a concept that I have held for a long time and that is Wealth. Rich Dad Poor Dad introduced me to the definition of wealth as stated by R. Buckminster Fuller which is: Wealth is a person’s ability to survive so many number of days forward—or, if I stopped working today, how long could I survive? Think about it, if my cashflow matches or exceeds my expenditures I am wealthy. That made the concept of wealthy very approachable and thus very reachable. An amazing book I can recommend anyone who feels caught in the rat race to read.

0 comments

Recent Posts

See All

Comments


bottom of page