Thinking About Money The Rich Dad, Poor Dad Way (Book Review)

Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money--That the Poor and Middle Class Do Not! is Robert Kiyosaki's and Sharon Lechter's first best-selling book.It has been on The New York Times Best Seller List for five years and was USA Today's No. 1 money book for 2004.

Given Robert Kiyosaki’s popularity, some readers might disagree with the opinions stated in this post. However, this is my unbiased thoughts on the book, regardless of its popularity.

The entire book is wrapped around a story of how he learned, observed and distinguished two people making money; rich dad and the poor dad.(I wonder why this book wasn’t titled, “The tale of two dads”! )
His real dad who was highly educated, is called the "Poor Dad". The other, was his best friend Mike's dad, who was an entrepreneur with very little school education. Kiyosaki calls him the "Rich Dad".

Browsing Through Rich Dad, Poor Dad

Lesson 1: The Rich Don’t Work For Money
The book starts off with some appealing stories about two little boys (Kiyosaki and Mike)who are trying to make money. Rich dad teaches the boys priceless lessons on money, by making them learn through experience. Kiyosaki's Poor dad also gave him advice; contradicting advice to Rich Dad. Kiyosaki talks about how he struggled as a kid to choose between the two very different ways of dealing with money.

Lesson 2: Why Teach Financial Literacy? makes his case by stating, the growing gap between rich and poor is rooted in the antiquated educational system. Later he helps the reader understand the difference between an asset and a liability.

Lesson 3: Mind Your Own Business relates his experience of selling photocopiers on commission at Xerox and how he used his earnings to buy real estate. Basically, the message Kiyosaki gives in this chapter is to keep your day job, but start minding your own business!

Lesson 4: The History of Taxes and the Power of Corporations advices you to do your own research and find out what tax laws will bring the best advantages.

Lesson 5: The Rich Invent Money highlights that self-confidence coupled with a high financial IQ, can earn more rather than merely saving a little bit every month. It also urges you to make good use of your time and find the best deals.

Lesson 6: Work to Learn –Don’t Work for Money brings to light, five obstacles to financial independence; Fear, Cynicism, Laziness, Bad Habits and Arrogance. Unlike other chapters this chapter offers you some actionable suggestions on how to deal with it.

My favorite excerpt
Most people never study the subject [money]. They go to work, get their paycheck, balance their checkbooks, and that’s it. On top of that, they wonder why they have money problems. Few realize that it’s their lack of financial education that is the problem.

What this Rich Dad, Poor Dad is NOT

Before I bought this book, I read a fair amount of reviews. Even though the book was a best seller, there were quite a number of critiques. Here's my 2 cents ...
  • This book doesn't tell people what to do

  • If you're looking for 'how to get rich' instructions, you won't find specific step by step instructions in Rich Dad, Poor Dad. I think Kiyosaki intentionally does not give specific instructions, because he believes that everyone must find their own way. As he continues to say "My books and games are not designed to tell you "how to do something", but are designed to teach you how you must think and who you must become.

  • Fact or fiction
When I initially began reading Rich Dad, Poor Dad, I wondered whether the story portrayed by Kiyosaki was true. Did he really have a “Poor Dad” with such an attitude? I suppose I will never know. The more I read of this book, it didn't really matter whether the story was fact or fiction. He tells a very good story! There is a moral in the story and it definitely teachers you something.

Overall

I found Rich Dad, Poor Dad to be very inspiring. Somehow, I felt that I was reading this book, a few years too late! The book doesn’t overwhelm people with technical jargon. It simply concentrates on the inner being of what it takes to be rich.

I’d recommend this book as an good way to challenge your thinking about work and money, in ways you haven't thought before. However, if you need technical "how to's" and "to do's" in personal finance, this book is not for you.


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6 comments:

Azrael said...

Yep loved this book. A lot of good points to think about :D

Jack Point said...

Don't waste your time with this rubbish.

Just check these:

http://www.slate.com/?id=2067175

http://en.wikipedia.org/wiki/Rich_Dad,_Poor_Dad

http://www.johntreed.com/Kiyosaki.html

http://www.thesimpledollar.com/2007/04/07/review-rich-dad-poor-dad/

Enhance Life said...

A mix bag of opinions so far :-)

@Azrael: Glad you got something out of the book.

@Jack Point: Before buying the book I read John Treed's article as well as thesimpledollars review amongst few others.
John Treed's article is more about Robert Kiyosaki as a person, not the book itself.
thesimpledollars review, was his opinion and I am all for it since it is one person expression his point of view.

my question is, if the book is that bad how come it was on The New York Times Best Seller List for five years and was USA Today's No. 1 money book for 2004?

Shamelle

The Benevolent Dictator said...

I normally don't read self-help books but found this one very interesting and quite useful. Two examples from the book that stand out are
1. The commonly held notion by homeowners who have bought/built a house using a loan/mortgage that they possess an asset whereas they're really possessing a liability.
2. The usefulness of starting up a company and using the inherent tax benefits to your advantage.

InvestorBlogger said...

Unfortunately, JR is right and wrong.

It's very easy to be critical of RDPD's ideas, but such criticism SHOULD offer an alternative. Does JR? I'm not sure that he does from what I read. He simply attacks.

Kenneth

Anonymous said...

You have some literacy issues which can be overcome. Bless you.

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