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Rich Dad, Poor Dad.

Personal-wealth books are a dime a dozen. Why would I want to read another? A friend gave me a copy of Rich Dad, Poor Dad. I held little hope that it would say anything eye-opening or original. But it was a gift; I appreciated the thoughtfulness and felt obliged to take a look and demonstrate that I did so. And you know--Mike Youngworth is a sharp man. He wouldn't give it to me if it did not offer something of value.

Sure enough. He did me a favor.

Mike and I are both in our early 40s with kids, cars, a house in the suburbs and a country club membership. We work our tails off and I'm certain he wonders, as I do, "How can I step off this train!?"

Rich Dad, Poor Dad is an easy read. It spoke to me as I guess it did to him.

It's a simple story--supposedly true--about Robert Kiyosaki, who has two fathers. One highly educated and with a good job but no accumulation of wealth and forever beholden to a boss. The other with little formal education but a commitment to build wealth and freedom. Kiyosaki listened to both, then decided to follow the advice of his rich dad, a street-smart entrepreneur. Kiyosaki, by following that advice, says he found substantial wealth that he continues to build. Through Rich Dad, Poor Dad, originally published in 2001, he tells his story and offers the lessons to all of us. The book has sold multiple millions, perpetually resides on the best-seller lists and garners a four-star rating on Amazon.com.

What is the path of the Rich Dad? It's really what all of us in the rat race know we should do--spend less and more wisely

Here's my summary of the lessons:

1. The poor and middle class work for money The rich make money work for them. You should, too. It's a lot more fun and substantially easier to amass real wealth.

2. Don't focus on getting higher-paying jobs. Focus on learning about money, finance, and how to make money This is your foundation. Start by reading and trying. Start making little investments and learn from them. Go to lunch with people who are making money through investing. Listen and learn.

3. Amassing "things" won't make you rich. Amassing things that make money will. Rich Dad seems to like real estate. Residential and commercial. Buying and holding; buying and selling.

4. When you make money, spend it on income-generating assets. Don't waste it on consumables or items that decrease in value and/or require cash. Contrary to conventional wisdom, Rich Dad says a house is not an asset--unless you rent it to someone at a profit. With you living in it, it does not generate income but rather considerable expenses in the form of taxes and maintenance. Resist the temptation to buy big homes and expensive cars unless you adhere to #5 below

5. When you want something that costs money, like a boat, resist the accepted means for acquiring it--borrowing money Challenge yourself to find a way to earn the money and pay cash. When Rich Dad wants a new Porsche, he challenges himself to earn the money through his creativity, innovation and initiative. By reading and learning through trial and error, he's gotten to where it's easy. He just searches around, typically for real estate, and finds a deal such as a residential property that can be bought cheap and rented for monthly cash flow

Thank you, Mike. This simple little book reinforces principles that I need to keep in mind and in practice. We all should. If not for the money, for the freedom and quality of life.

By Robert T. Kiyosaki, Published by Warner Business Books
COPYRIGHT 2006 D.L. Perkins, LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2006 Gale, Cengage Learning. All rights reserved.

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Title Annotation:personal finance
Author:Kiyosaki, Robert T.
Publication:The Business Owner
Article Type:Column
Geographic Code:1USA
Date:Sep 1, 2006
Words:627
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