the richest man in atherstone

Title: Rich Dad, Poor Dad
Author: Robert T. Kiyosaki
ISBN: 0-7515-3271-1
Publisher: Warner Books

The best-selling book ‘Rich Dad, Poor Dad’ looks at the subject of personal finance from the point of view of the rich and teaches the reader how to change their perspective so that they too can become wealthy.

Kiyosaki talks about his life from the age of 9 when he met the man whom he calls his ‘Rich Dad’. Rich Dad is actually his friend’s father, a self-made millionaire whilst Poor Dad is his real father, a relatively poor goverment worker. Throughout the book, Kiyosaki compares and contrasts the beliefs and opinions of these two influencial figures. He made the decision quite early on that for financial matters, he would follow the advice of his Rich Dad.

The aim of the book is to teach the reader “Total Financial Self-Reliance”. This means being able to live without the need for a job or salary.

“The poor and the middle class work for money. The rich have money work for them.”

He explains how the reader must change themselves and learn to control their emotions to make logical financial decisions. Fear and greed are the biggest two emotions that must be tamed to help acquire wealth.

Kiyosaki puts great emphasis on knowing the difference between an asset and and liability.

“Rich people acquire assets. The poor and the middle class acquire liabilities, but they think they are assets…An asset is something that puts money in my pocket. A liability is something that takes money out of my pocket.”

He gives, as an an example, a person’s home. They may think it is an asset, however because of bills, upkeep costs and council tax it is really a liability. Personally, I disagree with this because everyone needs a place to live and a lot of people do make capital gains on their abode but I do understand the point he is trying to make. He recommends spending your life keeping expenses down and acquiring assets. As the income stream from the assets increases eventually there will be enough cashflow to passivly cover exenditure and luxuries. Any left over should be pumped back into the asset column.

The importance of understanding legislation including the formation of companies is also recommended by Kiyosaki. Not only can it help keep your tax bill low but also allows you to play the system by working within the law.

A common theme is to invest in financial intelligence. Reading books, going to seminars and talking to people are all examples of this. Having increased your financial intelligence, he continues by stating that you must have the courage to use the knowledge.

“In reality, the only real asset you have is your mind.”

I thoroughly enjoyed reading this book, although there were a number of times when I became annoyed due to lack of structure. It is a bit like reading through someone’s notes that have been hastily stitched together and Kiyosaki does tend to ramble at times and repeat the same things over and over again. The first chapter or two are in the style of a storyteller, whereas later chapters are in the style of a speaker. The change in prose is quite odd. There are also advertisements for Kiyosaki’s board game scattered throughout the text, although they are kept within the context of the point he is trying to make. Also, there are periods where Kiyosaki sounds as though he is boasting about his achievements, although I feel he has done this on purpose to ignite a flame of passion in the reader.

On the whole, the book contains lots of great theoretical advice and has certainly changed my perspective on a few things. If you can get through the waffle, bragging and disorganisation, this book is a great read.

The Rich Dad Website
John T. Reed’s scathing analysis of the book