Rich Dad Poor Dad is a book about the financial lessons that can be learned in life. Robert delves into his life as he was brought up in Hawaii and discusses the differences between his fathers approach to finance and the approach of others in his life. As he tells about his life and schooling in Hawaii, you get a really clear glimpse into the financial mindset of two men who played an important role in his life and what he learned from their experiences.
There were several instances in Robert’s upbringing that effected the decisions of these two men and these instances are discussed in this book. Robert spends some time in the book describing why it is so important to have intelligence in the financial avenue of your life and how it can improve the outcome of the financial decisions that you make. He discusses the major difference between individuals and corporations when it comes to how they spend their money.
Robert has strong opinions when it comes to personal finances as well. He believes that investing in 401K retirement funds is not the way to go about creating a strong financial future. While this belief was met with strong criticism, he continues to stand behind it. He also believes that those people that strive to achieve a formal education are setting themselves up to be employees or to be self employed. Robert believes that the best avenue to achieve financial freedom is to become a business owner or to become an investor.
Robert created a conceptual tool which allowed him to describe four categories for the ways that someone can create an income. He called it The CASHFLOW Quadrant. Each quadrant is represented by a letter, E, S, B, or I. They stand for employee, self employed, business owner, and investor. He has also created four main classes for assets. They are business, real estate, paper assets, and commodities.
A big part of what Robert teaches covers creating a passive income by taking advantage of investment options that come up. This includes businesses and real estate. The main goal of these teachings is to get yourself into a place where you can support yourself on the income that is created from your investments.
Robert believes that financial intelligence can be taught early in childhood by introducing certain games to a child. Playing Monopoly with a child teaches them to think strategically about their investment decisions. They learn that trading in a few small houses for a larger hotel can bring more income into their game. Robert has created other games like this to help teach our children how to become strong in their financial avenues as they grow older.
While Robert has opinions that are not accepted by all, the book Rich Dad Poor Dad is a well written book that contains valuable information for anyone that reads it. The story gives a real like example of what impact the decisions in our financial life can have on the successes that we achieve through our lives. This personal story provides an insight into his life and an explanation of why following the coaching he provides can lead to a more secure, financially free lifestyle for you and your family.
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