love reading books, since my childhood. In my opinion, reading books is just the best thing to do, we can learn so much from the author’s experience. In the age of digitalization, a person can read Kindle, ebooks and audiobooks, there are a lot of resources present on the internet for bookish people like us. But, tragically, reading habit is dying due to the internet. According to studies, there are large numbers of people who read only academic material.
Books guide us, Spark new ideas in us. Through this article, I have an opportunity to share my favourite book Rich Dad Poor Dad by author Robert Kiyosaki who is a successful entrepreneur and author of the best-selling book.
This book is about a different mindset of different economic backgrounds like poor, middle class and rich. The author is comparing the knowledge and understanding of money between Rich Dad and Poor Dad. Before we begin, it is important to know who is a rich and poor dad.
Poor dad is the author’s biological father, who is highly educated and works for the government. On the other hand, the rich dad is the author’s friend’s father, he is an entrepreneur who is financially literate and not struggling financially like a poor dad.
One key point should be noted, poor dad receives a good amount of money as a monthly salary, but the author is regarding his poor because of his financial illiteracy and his mindset.
The story begins when a thought emerged in the mind of 9 years old Robert, “How to become Rich?”. As he was studying in a school along with rich kids, he too wanted a life like them.
So to become rich he and Mike formed a partnership for the workshop but without the expert’s advice, all was in vain. Later, Robert asked for their poor dad’s advice and he replied “if you boys, want to learn how to be rich don’t ask me.
Talk to your dad Mike” (Statement from the book) And here is a turning point where two boys got to know the theory of Rich Dad to create wealth.
The book enumerates the importance Of financial education and the lack of this concept is emphasized as the mindset of the poor and middle class, it is the key reason for their economic condition. Because to become rich you need to develop this skill, it is not only about working hard.
As stated earlier, Rich Dad is not struggling financially unlike poor dad. The book further elaborates that a person can become financially literate only through experiences, as none of the education systems teaches us about financial education.
So while reading this book, I observed that rich dad is conveying author and Mike to get more and more experience from people around them by working under them.
In addition, the book has a brief explanation of the difference between assets and liabilities. A common man regards housing, credit card, wedding, etc. as an asset. But this is not the case with Rich Dad’s theory.
According to him, if things that you buy increase your monthly expenses, then it is not an asset. For example, a credit card, a person who has a credit card acts foolishly (if he is not financially literate) while buying things and he shall buy those things too that he doesn’t want, this will increase expenses only.
In Rich Dad’s opinion, this is a poor mindset because it creates liabilities. So he regards assets as those things that can make a profit like the stock market, forex market, real estate, etc.
The other thing that I love about this book is to “think like a rich”, another Rich Dad’s advice. And he explained this to Robert and Mike in a simple manner. According to him, it is common to be bankrupt if you are an entrepreneur. It becomes a problem when bankruptcy enables you to think that you are broke.
Being entrepreneurial is about thinking like a rich, even if you do not have a penny in your pocket, to become rich you need a mindset like “Rich never works for money”. Yeah! It sounds tricky but in the views of a rich dad, working for money is a sign of a poor mindset because your objective becomes narrow and that is monthly salary.
Rich dad call this a Rat trap, to become rich it is important to get rid of this. One thing that should be kept in mind is that Rich dad is not saying that working as an employee is being poor, but if a person is an employee or employer and working for money then it is a poor mindset.
As the book describes opposite mindsets, the author observed that Rich Dad never uttered “I can’t afford it” instead he asks himself “How can I afford it”. On the other hand poor dad constantly utters “I can’t afford it”. These different statements tell us that one person wants to change a situation, while the other is accepting himself as he is and this is a poor mindset.
I highly recommend you to read this book because the skills and mindset that are mentioned in this book are important to learn. It helped to know so much about financial education. And so this is my favourite book.
