If you have googled the “best personal finance books to read” recently, you would have most likely come across the title Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money—That the Poor and Middle Class Do Not!. Written by Robert T. Kiyosaki and Sharon L. Lechter, the book has reportedly sold over 32 million copies in 40 languages across 40 countries since it was published in 1997.
The book talks about the importance of financial independence and emphasises the need to build wealth through mindful spending. It tells the story of Kiyosaki and his two dads, and how growing up with them helped shaped his views on life.
Kiyosaki’s biological father, or the ‘poor dad’, was a highly educated professor, who believed that one should work for money as a single-salaried employee at a stable job and that a person’s wealth largely depends on their family background. On the other hand, Kiyosaki’s ‘rich dad’ is the father of his best friend, a wealthy entrepreneur who owns dozens of businesses. He believed that wealth comes from experience-based learning and multiple income streams.
Rich Dad, Poor Dad offers powerful life lessons that can be useful for anyone looking to broaden their perspective on money. It makes you ask yourself thought-provoking questions such as, “do I want to continue running the rat race?”, “am I afraid to take risks?” or “am I making the right decisions?”
Here are some essential takeaways from the international bestseller.
Conquer your fears
Most of us give in to our fears and allow them to control us without even realising. For instance, you want to quit your accounting job to open a cake shop. However, worries about the lack of stability and benefits hold you from taking that step forward. That is fear and doubt making the decisions for you. Fear holds you back from reaching your dreams, growing personally and professionally, and realising your true potential. This perspective can be costly in the long run. “In the real world, it’s not the smart who gets ahead, but the bold,” says the ‘rich dad.’
Become financially literate
Kiyosaki talks about an important concept in his book—the need to become financially literate, which means understanding the basic structure of how money moves in the world. Being in control of your financial life can be a cumbersome task if you don’t know how things work. An effective practice is to analyse how much you earn and spend every month. By following this method, you become aware of where your money is coming from, how much is leaving your bank account, and how much you are able to save. According to Kiyosaki, “Money comes and goes, but if you have the education about how money works, you gain power over it and can begin building wealth.”
Think in terms of opportunities
In the book, Kiyosaki’s ‘rich dad’ doesn’t let his son say, “I can’t afford it.” Instead, he tells him to say, “How can I afford it?” While the first phrase restricts your thinking, the second opens up possibilities, challenges, excitement, and dreams, forcing the brain to come up with solutions and answers. The author suggests that the primary reason why the majority of the poor and middle class don’t achieve success in life is because they don’t think in terms of opportunities. So, if you want to be successful in life, you should be open to facing challenges and taking risks.
The more you give, the more you receive
You must have come across people who want more from life but are unwilling to give anything in return. They are like Kiyosaki’s ‘poor dad.’ He belonged to the labour unions and wanted to work less and get paid more. But that’s not how the world works. If you want to get paid more, you need to work for it. You may not get the results immediately, but the efforts you put in will sooner or later give a good return. If not, you need to re-evaluate your strategy and ask yourself whether the project you have invested in is worth your time and money.
Comments