Rich Dad Poor Dad, by Robert Kiyoaski

My Book Review & Summary

I’ve had an entrepreneurial mindset as long as I can remember, at least since early highschool. I remember first reading this book when I was about 17 and I think this book had more of an impact on me at that time than any other book has had on me since then. I just finished rereading this book 25 years later, and it was as good as I remembered.

Instead of saying, I can’t afford it, start saying, how can I afford it. That is the main premise of this book.

Robert Kiyosaki uses this book to compare his “rich dad” to his “poor dad”, hence the name Rich Dad Poor Dad. Both of his fathers were good men, but both looked at finances much differently. His rich dad wanted Robert to avoid the rat-race of spending your life working just to get by. 

“For all the years I studied and learned from him, he always reminded me that knowledge was power. And with money comes great power that requires the right knowledge to keep it and make it multiply. without that knowledge, the world pushes you around.” ~ Robert Kiyosaki, Rich Dad Poor Dad

Assets VS Liabilities

Assets vs liabilities is the central theme to Rich Dad Poor Dad. The poor accumulate liabilities and the rich accumulate assets. Understanding how to look at assets and liabilities, and knowing which column an item would belong to is important to understanding how to become rich.

“Rule number one: you must know the difference between an asset and a liability.
Most people struggle financially, because they do not know the difference between an asset and a liability. The poor and middle class buy liabilities that they think are assets
An asset is something that puts money in my pocket.
A liability is something that takes money out of my pocket.
This is really all you need to know. If you want to be rich, simply spend your life buying assets. If you want to be poor or middle class, spend your life buying liabilities. It’s not knowing the difference that causes most of the financial struggle in the real world.”~ Robert Kiyosaki, Rich Dad Poor Dad

Rich Dad Poor Dad uses quite a big of examples and diagrams showing different ways people look at assets or liabilities. Here’s a few of the simpler graphics from the book:

“As your cash flow grows, you can buy some luxuries. An important distinction is that rich people buy luxuries last, while the poor and middle class tend to buy luxuries first. The poor and the middle class often buy luxury items such as big houses, diamonds, furs, jewelry or boats because they want to look rich. They look rich, but in reality they just get deeper in debt on credit. The old-money people, the long-term rich, built their asset column first. Then, the income generated from the asset column bought their luxuries. The poor and middle class buy luxuries with their own sweat, blood and children’s inheritance.”~ Robert Kiyosaki, Rich Dad Poor Dad

My Thoughts on Rich Dad Poor Dad

My second time reading this book I did the audiobook, which was excellent. But I forgot about the graphics and examples that are in the hard print book because they weren’t even mentioned in the audio. But most people would have the basic knowledge of the charts to not need them anyways, so I would still recommend the audiobook. But man, this book really makes you start thinking of how to accumulate some assets. While listening to the book I just kept writing down ideas, just like I did the first time I read this book over 20 years ago. 

This book doesn’t necessarily give you a blueprint for making money or starting a business. It’s more to teach you the foundation of accumulating wealth properly. I can’t recommend this book enough, and it’s a really quick, short read. I have not read any of the sequels to this book still, so if anyone has, I’d love to hear your thoughts on those below.

“it is what you know, that is your greatest wealth. It is what you do not know, that is your greatest risk. There is always risk, so learn to manage risk instead of avoiding it”~ Robert Kiyosaki, Rich Dad Poor Dad

If you’ve made it this far, I’d recommend checking out my book review and summary of The Psychology of Money, by Morgan Housel. This is a great follow-up book to get a better understanding of how many works and why we develop habits around money.