Dan
A review of Rich Dad, Poor Dad, by Robert Kiyosaki. I finally bought this book (the audio version for the trips back and forth to school), due to several recommendations. It has made quite an impact on several people I know (when I say impact, I mean they love to talk about it… I have yet to see any financial impact). There is basically one good idea in the book: residual income is a good thing. If you already know that, then skip this book. Kiyosaki expresses the idea that residual income is a good thing by saying that you shouldn’t work to make money. Rather, money should work for you. With that concept in mind, this book will help you refocus the way you think about money. It’s basically a pep talk to get you to go out into the world and find ways to establish continual income sources. Of course, Kiyosaki offers very little information about how to actually do it.
Bottom Line: I do not recommend this book. Pass this one up.
Other than that, I found the book to be arrogant and demeaning. His “rich dad” is actually his friend’s dad that he hung out with because his real dad was not rich. His “poor dad” is his biological dad, who had a PhD and was a teacher. The entire book demeans the biological dad for choosing to be a poor school teacher. I just kept thinking… “that poor dad, to have such a son.”
He also has a very negative image of the lower class as demonstrated by his philosophy for paying employees. He believes that if he were to give raises to his lower class workers, they would just waste it. According to him, being lower class is their own fault. This is only one example of some of the questionable morals taught in this book.
So, this is like many typical self help books. It offers inspiration and motivation, but falls short in the how-to details. It also offers tactics that are financially sound, but morally questionable.
The point of the book is to show the difference in mindset between the rich and the poor. Poor people buy trinkets that loose value ( TV’s, Vacations, Cars) with the money they worked hard for, while rich people buy assets ( Rental Properties, Businesses, Intellectual Properties) that make the money to buy their trinkets so they don’t have to work hard for them.
Most of the time these assets are bought with borrowed money. Rich people see abundance, while poor people see scarcity. It’s all in the mind.
Example:
Let’s say 2 people win the lottery for a mere $100,000.
The poor mind set sees that as a finite amount of money that needs to be saved and spent carefully, or blown completely because it doesn’t happen very often.
The rich mind set sees that as an opportunity to lend out in smaller portions of it with a decent interest rate ($20,000 @ 9% APR) and make more money off of it.
Rich Dad Poor Dad is the fist book of its kind that truly explains these ideas. GO GET IT!
@Fred: Thanks for the comment. This is true. I think that even your example boils down to the fact that the lottery income is best used to generate residual income. So, I agree… if you need to change the way you think about money so that money will produce income for you, then sure, get the book. Use it to change the way you think about money. Do not use it as a moral compass.
@Dan: Sometimes the truth is a hard pill to swallow. I didn’t find the book demeaning at all. Having been one of those lower class workers, his point was spot on. What i think is more immoral is allowing those is poverty to think its someone else’s fault they are in that situation. I guess, in a way it’s do to their up bringing an examples like “poor dad”. But once you become aware of the fact that you are poor and others aren’t, it becomes your choice and responsibility to change your reality, to shift your paradigm.
The principles in the book are basic. Don’t spend what you don’t have, look for ways to increase your means, and embrace the opportunities that come your way. He goes in more detail in his other books and programs that i think you were expecting to get in this book.
You might be right about his other products being better. I have not had any exposure to those. Except for the Cash Flow game. I played it at a friend’s house once . I found that to be a much better way to get his message across. In the book, he even says that he teaches better through games. I agree. I would definitely recommend the cash flow game for a good time (if it didn’t retail for $195! – that is a huge residual income asset for Kiyosaki!) 🙂