Hey! A few days back, I completed a book which was first of this genre I ever read. And now I think why never this topic did attract me before? This blog post is a brief overview of the thoughts given in the book. The genre is “Financial Literacy”, authored by “Robert T. Kiyosaki” and the book title says “Rich Dad Poor Dad”!
Okay, I think I will keep this post short as I don’t want to tell you all the spice because I think I will ruin the way I’ll summarize the content compared to the context present in the book.
Alright, let’s get started. 🙂
A bit about the book
The book’s major objective is to enhance readers financial aptitude. The author describes the contrast in the thought process of the rich and poor. A lot of tips and fundamentals to become rich are peppered in the book. I see it as a perfect place to start building your financial intelligence.
How can you say if someone is rich or not?
Well, no matter how weird you think the question is, but its really worth asking. Please first tell yourself, what do you think the meaning of being “rich” is, or putting it in another way, how will you define the word “rich”?
I hear most people say, when you got money, you got rich. So, does being rich means you got a lot of money? If that’s the case with you, I would counter question to please specify the amount of money that will make one rich.
Suppose you specify a reasonable (not dreamy billions of dollars) amount of X to become rich, then I can show you examples of people who are not rich even after having the double amount of X with them.
In short, the amount of money is not the only key. Now brainstorm a bit to find out a decent definition of the word “rich”.
I don’t know what you thought, but here is what I learned in the book. This is the personal explanation of Robert T. Kiyosaki in the book and seems completely convincing. I am presenting here in my own words.
Suppose, you just stopped working, stop going to your job, stop running businesses that need your presence and now you are just relying on your assets to live your life. Assets may be your fix deposits, your stocks, etc. Tell me, how long will you be able to survive?
For example, if the revenue generated by your assets in a month is less than your monthly expenses, then it means, you can not survive even a month, or less you need to cut out your expenses.
But in case, the revenue generated by your assets is equal to your expenses then you become a wealthy person, you may live your life without working. But still, it doesn’t make you rich. To become rich, you need to cross *this* limit.
So, who is rich? Those, who may just stop working and still can survive their whole life because the revenue generated by their assets is greater than their expenses. We call *these folks* rich.
The book is galore of TIPs and TODOs on financial literacy, but here I have shortlisted a few.
1. If you want to be rich, then the following subjects are must learn:
- Financial Law
2. Specifically, at least you should be able to create and make use of:
- Balance Sheets
- Income Statements
3. Schools will give you professional skills but financial skills you’ll need to learn from the world outside.
4. Understand the difference between assets and liabilities.
Last but not least
5. Profile of riches:
- Assets are greater than liabilities
- Income is greater than expenses
- The home is not the biggest investment of life
Pre-requisites to become rich
The book deals majorly in thought processes and habits of rich people. The way they think and tackle situations in contrast with poor people. Following are some pre-requisites to become rich.
- A healthy mind and soul (e.i: unhealthy mind can not think of making money a healthy way)
- Controlled emotions (e.i: being greedy is good for success unless it hurts anyone around you)
- Stay away from bad habits (e.i: habits has the potential to make your life a success or a complete disaster)
- Don’t let the world and society to stop you (e.i: you do wrong, they’ll comment, you do right, they’ll comment, you do nothing, they’ll still comment. xD )
The one-liner gist
The complete book stands on a single thought that is:
Your brain has all the potential to make you rich.
Now it depends whether you like to play it safe or play it smart?
‘Play it safe’ refers to going to school, getting good grades, getting a secure job and living a common life.
‘Play it smart’ refers to enhance your financial intelligence to make money. Don’t afraid of risks, instead learn how to tackle them. Go to schools, get a job but don’t ignore financial subjects.
If you chose to play it smart, you may start with the subject of financial literacy with Rich Dad Poor Dad by Robert T. Kiyosaki
As I said, I will keep this post short but I have written more than I expected. Now, if you like the thoughts in this blog post, then you’ll love the actual book.
- The subject of financial literacy is attractive and tricky, make sure you get it correct.
- Don’t just accept the guidings blindfolded (especially, if the context is financial).
- Try to verify if the content is non-fictional (if it claims to be non-fictional).
- Getting inspired is good, but it should not come on the foundation of shallow beliefs, lies or hypothetical optimism.
- Probably write a book review, so that people can come and help you to understand the truth behind. 🙂
I hope you enjoyed it.
Thanks for reading!
See you in the next post 🙂