Rich Dad Poor Dad is a famous financial book by Robert Kiyosaki that is recommended for all people who desire to have financial freedom in their life. The book is an all time favorite of people across the world that is available in 51 languages. The book outruns the general concept of becoming rich with higher income and explains how strategic investment can generate money to give you a rich and luxurious lifestyle.
As per the Journal review- Robert Kiyosaki summary of Rich and Poor Dad book, the education about financial freedom here has been given through various financial lessons along with thorough knowledge on the concepts of assets, liabilities, investment, and financial laws.
4 key lessons to learn from Rich Dad Poor Dad book
The book features Robert Kiyosaki’s two fathers. One is his Biological father who is highly qualified with a Ph.D. degree but, his financial conditions are not up to the mark. He is referred to as the poor dad here. The Rich Dad, on the other hand, is referred to his friend’s dad who is a school drop-out but, runs an established business in Hawaii and is one of the richest men.
The book talks about the financial education that students are always being deprived of while they are in school. Whoever aspires to live a luxurious life should consider these 4 valuable lessons from the book.
Lesson 1: Rich don’t work for Money
This refers to the never-ending goals rich people set until they reach the threshold point, where they don’t have to think about money. Kiyosaki here has talked about the passive income that generates cash flow even if you are not working. General people work hard for high wages but, as soon as they stop working, cash flow ends there. But if you carefully invest in your assets where the cash flow is recurring, you don’t have to worry about money.
Lesson 2: Why teach financial literacy
In the second lesson, Kiyosaki has explained the concept of Assets and Liabilities in his own way. According to him, assets should be something that can create a source of income and liabilities are something that has got a net value associated with it. According to him, to be rich, one needs to own multiple assets for generating unlimited cash flow. He has also laid the stress on generating cash flow first before thinking about spending it in luxuries.
Lesson 3: Mind your own business
Kiyosaki has explained about investment ideas here. He has encouraged readers to spend their money in profitable investment rather than spending too many bucks in materialistic expenses. He has explained here how to maintain your financial budget, be intelligent with the expenditures, how to utilize assets like mutual funds, stocks, bonds, real estates, intellectual properties, etc to generate money, how to correctly invest and utilize your paycheck money and everything related to investment strategies.
Lesson 4: History of taxes and power of Corporation
In this lesson, Kiyosaki has motivated readers to utilize the loopholes of the taxation system. He encouraged individuals to create their own organization or corporation where the tax is based on what is left after the earning and expenditure. Contradictory it, if you work as an employee, the tax is based on your income and after its payment, what is left becomes your expenditure. This is the reason why salaried employees are affected by the tax system, while the entrepreneurs remain unaffected.
The book provides many valuable financial lessons but these 4 are the key ones. It is one of the best choices of the individuals who are interested in smart investment strategies and aim to live a luxurious life.