Money Monday – Lessons from ‘Rich Dad Poor Dad’ by Robert Kiyosaki

“Great opportunities are not seen with your eyes. They are seen with your mind. Most people never get wealthy simply because they are not trained financially to recognize opportunities right in front of them.”

― Robert T. Kiyosaki, Rich Dad, Poor Dad

Not having enough income or no income at all can make becoming wealthy a dream that’s only afforded the elite few. We’ve been taught that only super high income earners and people born into money, can become wealthy. Yes they can get richer, some lose their wealth, but it does not mean that you cannot create your wealth too.

“Rich Dad Poor Dad’ challenges these misleading beliefs about wealth and demonstrates how you can start your way to creating your own riches. He illustrates this with a story about his real father, a teacher who made a good living but struggled to make ends meet, and his friend’s father who had little education but ran multiple businesses. The latter opened up a new world to him by introducing him to financial education outside of school.

Here are the lessons you’ll learn from this book:

Lesson 1: The rich do not work for money but rather it is money that works for them. He explains how greed and fear affect our financial patterns and how they can make us work so hard for so little just for security.

Lesson 2: Teaching financial literacy is of supreme importance and it should start at an early age. It’s not about how much you make but how much you keep (This reminds me of ‘The Richest Man in Babylon’). We have many professionals and highly educated people who are excellent at their jobs but are not so good with personal finances. He stresses that one needs a strong financial foundation and in addition, an education on how to manage money.

Lesson 3: We spend time minding other people’s businesses and less on our own. You could spend a lifetime working for someone, making them money and end up with nothing for yourself. Here he introduces Assets and Liabilities and the importance of acquiring assets, and reducing liabilities and expenses.

Lesson 4: It’s crucial to understand tax and its advantages. Business owners earn, spend and pay taxes, while employees earn, pay taxes and spend what is left. If you want to earn wealth you should make it your business to know as much as you can about your tax legislation.

Lesson 5: Financial IQ allows you to see opportunities where others don’t and to act on them. Wealthy people create their own luck and end up inventing money. Whilst money may seem like the greatest asset you can possess, it’s actually your mind that is your greatest asset.

Lesson 6: He points out how when it comes to money, the only skill that most of us know is to work hard. A lot of people work hard at a secure job and focus on the pay and benefits, which is short-term vision. He suggests learning another skill, one that will help increase your income.

Lesson 7: Robert lists five main reasons financially illiterate people may still not have abundant cash flow: fear, cynicism, laziness, bad habits and arrogance. How these are managed makes a difference between people with wealth and those without.

Lesson 8: How do you start?  Some of the things advises us to do are to find a reason greater than reality. Make a daily choice to be rich, associate yourself with the right people, and be aware of the power of learning quickly. Master your self-discipline and pay yourself first (‘The Richest Man in Babylon).

Lesson 9: Some few more things to do:

  • Take time to assess what’s working and what’s not.
  • Learn from someone who has done it before.
  • READ! Take classes and go to seminars.
  • History has good lessons, learn from there.
  • Take action.

There’s a whole lot more in the book that you can read, the above are merely to show you the kind of knowledge you will gain from it.

Overall, this is an easy book to start on your financial literacy journey. I would recommend that people read it as early in their lives as they can. Give it to a younger person as a gift or someone with little to no financial IQ. You can use it as a tool to gaining financial freedom. I’ve read other books on the same subject and this is one of the easiest to understand.

I hope this helps you on making a financial difference in your life. Enjoy!

‘The Richest Man in Babylon’ Is A Worthy Investment In Your Journey To Financial Prosperity

“Where the determination is, the way can be found.”

― George S. Clason, The Richest Man in Babylon

Title: The Richest Man in Babylon

Author: George S. Clason

The Richest Man in Babylon is a famous classic that gives exemplary financial advice. It uses parables that one can easily adopt and apply. In the book, Arkad is the richest man in Babylon who shares his journey to wealth.

He shares ‘the seven cures for a lean purse’, which are:

  • ‘Start thy purse to fattening.’ This reminds us how there are many trades with which we can use to earn money and how to use that source of wealth that one already has. From what you earn you can start fattening your purse by saving one-tenth of your earnings.
  • ‘Control thy expenditures.’ Budgeting for the necessary expenses will help to put away one-tenth of the money you make.
  • ‘Make thy gold multiply.’ Making money work for you means that a stream of wealth will continue to flow into your purse.
  • ‘Guard thy treasures from loss.’ It’s wise to consult with people who have the knowledge to help with protection from unsafe investments.
  • ‘Make of thy dwelling a profitable investment.’ It highlights the important distinction between renting and buying, and also how you can use your property to establish a business.
  • ‘Insure a future income.’ It’s prudent to provide in advance for your needs as you grow older and for the wellbeing of your family.
  • ‘Increase the ability to earn.’ It is smart to develop your skills and sharpen your investment knowledge to increase your earnings power.

Amongst other parables, the book also shares five laws of gold which Arkad considers to be greater than the gold itself. These detail how gold works, whom it favours and whom it slips away from.

This book is a wise investment when making your way toward building your wealth or increasing it. After reading books like Rich Dad Poor Dad by Robert Kiyosaki and Tony Robbins’s Money Master the Game: 7 Simple Steps to Financial Freedom, I could already understand where most of their advice comes from and how many wealthy people practise the same financial habits that are in Clason’s book.

It will teach you a lot about how a great desire for wealth can be a good place to start, even when you don’t have much else to begin with. It will also emphasize why you should take advantage of opportunities available to everyone. You will learn how luck favours those who act and those who grab opportunities.

The Richest Man in Babylon is short and featherweight and despite some of its language being rather archaic, it’s still heavily loaded with beneficial advice. Its size and ease also help when you want to go back to its pages for a reminder, to find something that you previously missed or simply to clarify something along your journey to wealth.