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My friend recommended this book to me as he was also interested in money making and buisness. Robert really gives some foundations in thinking how money should work 'for' people and people are working 'for' it. Here he desribes, in the most simple way possible, the accumulation of assets that provide positive 'cashflow' (liquid cash). He gives numerous examples of excellent 'deals'. In one, he took advantage of comics going to waste collection to create a fee based library inside a person's house while hiring his sister to manage it. He gets kids around the neighbourhood to pay into it, getting positive cashflow without much work. In resemblence, later in life, he took advantage of a depressed housing market by bidding in bankrupcy auctions, getting excess of 1000% gains reselling it to a buyer using borrowed money. While I have to disagree with not diversifying your assets into other places, I can't deny he didn't do a good job of making money in optimal market conditions (for housing, low borrowing standards and high housing inflation). It should also be pointed out that Robert lost a lot of money by leveraging himself in the estate market, 'blowing up' in the 2008 housing crash. His message was pretty obvious upon reflection, leverage was key to his wealth, but also a key to his demise. Be careful in taking too much risk without understanding that you could become non-liquid pretty fast with large leverage multiples.
I liked this book, the reason I’ve written it as 4 stars and not 5 is because of the ‘study session’ fluff which just recaps the previous 25 pages with another 10 pages but in third person. The signal to noise ratio is high in this book but there are some gems.
I would say what I find most interesting is the concepts of cash-flow and spend your money building assets and not liabilities which I think is a big realisation for a lot of people.
I liked the narrative of how it was written at the different stages of the author’s life and what he learned from each stage.
I wouldn’t necessarily recommend some of the practises in a completely literal sense such as buying houses at foreclosure auctions (when laws etc may have changed since 97 or isn’t completely applicable in your country) or even investing in real estate 100%. But the concept behind putting your money into something that is generating cash flow is the important lesson.
As always we Canadians have to read these great books on Finance & relate what we can to our own Country. It is packed full of great information with an analogy between two different lifestyles being the premises for understanding how the rich think differently than the middle class. Highly recommend read to all for this purpose.
Ouais, çà ne casse pas trois pattes à un canard. Mais il y a du vrai dans ce que dit cet hawaïen américain. Il vaut mieux être rentier que de bosser tous les jours comme un esclave - sauf si c'est pour le fun. "The rat race" comme il dit. Et pour cela, il faut se constituer un patrimoine qui produit des revenus - y compris en droits d'auteur comme pour ce livre à grand tirage hé hé ! En jouant sur la fiscalité (américaine...). En France, depuis que les revenus du capital sont imposés au même taux que les revenus du travail, c'est plus difficile. Car en France, on aime bien les esclaves, pas les rentiers. Question de mentalité. Mais les esclaves français sont mieux traités qu'aux USA, avec notre droit du travail à rallonge, notre système d'alloc et de subventions en tous genres. Voilà comment les USA fabriquent de riches rentiers (Hawaï est un état US), et la France des esclaves au chomage. CQFD.
Great book, however, if you are buying this book thinking that it is a finance or an investment book, I’d suggest you to do a bit of research on it first, as it is not a financial or investimento book, however, the writer gives you some ideias on what to invest your money. The writer also challenges some of the old ideia and the way most people have been educated. Overall good book, it will certainly change the way you think about a lot of things.
This is an enhanced reprint of the original, with additional study questions/ discussion and review added at the end of every chapter. I bought the original about 18 years ago and it changed my families destiny for the better. I am glad the reprint came out as it prompted me to reread it and deepen my understanding. Some people complain that this book does not give a step by step process for change. I would counter that one size shoe does not fit all feet. There are many individual paths to wealth, and Kiyosaki sets the guiding stars to navigate by, but you have to walk your own individual road.
Some key concepts of this book are: 1) Assets put money in your pocket even when you are on vacation. Liabilities take money out of your pocket, therefore your house is a liability [unless you rent out rooms and the garage as one person I know did while rebuilding his asset base]. 2) Wealthy people buy assets first, and then let their assets buy their luxuries from the surplus cash flow. 3) Wealthy people continuously increase their assets by reinvesting their surplus cash flow in more assets. 4) There are 3 primary asset classes: Real Estate, Businesses, and Paper assets (stocks bonds notes, etc) 5) Cash Flow is more important than Net Worth. Net Worth is similar to potential energy, to use it you have to spend it, then it is gone. Cash Flow is like power from a hydroelectric dam, constantly replenished. The rich don't work for money, they work for assets. The tax laws are fair from the standpoint that the laws that the rich spent billions of dollars to have modified and interpreted apply to everyone who learns how to use them.
A great foundation book for beginning to improve your financial intelligence so that you don't work 4 or more month's of every year for the Tax man, more months for the banks that hold your mortgage and credit cards, and whatever is left making the company you work for wealthy. Good luck on your journey to being Rich, poor, or middle class.
Interesting book and written in a very engaging way. I don't think there's much in there that isn't already common knowledge (like the rich acquire assets with their wealth to make more money) but the way in which it's explained and the systems involved make you think about the subject.
If your interested in personal finance and wealth then it's worth a read. If you think it's a handbook to make a poor Dad a rich one then I wouldn't bother.
Eye opening to how the system actually works from a financial perspective. Richard gives you the formula to life’s leverage and the rich poor divide. He explain how poor, working class and middle class are essentially the same, in the grand scheme of things, they just don’t know it. Makes sense when broken down. He shows why working 9-5 for a boss as part of the “rat race”, can never equate real successful nor can it bring complete financial freedom or security. Explains: Income, expenses, assets and liability cash flow in a basic easy to grasp concept.
I would suggest this book to every teenager. This book will initiate the thought process of how to persuade your life goals considering the financial segment which is one of the most important things that will matter in the long run. Money is not everything, but everything that can buy you food, clothing & shelter. Parents should give this book to their kids who are currently in college to have a read.
This book is brilliant! It invokes deep thought on your finances and explains the thought process involved, using anecdotes, humour and simple ideas to explain what happens to your finances and why. It explains the mindset of people and what to do to escape the cycle people find themselves trapped in, without being pretentious and is packed full of good advice. Additionally, it is comprehensible enough for younger readers to understand. All in all, a very useful book for readers of most ages, I would recommend everyone to read this.