Title: Rich Dad Poor Dad
Author: Robert Kiyosaki
Genre: Non-Fiction, Self-help, Finance
Robert Kiyoaski's “Rich Dad, Poor Dad” is a book about getting wealthy! The author contrasts his father (the poor dad) and his friend’s father (the rich dad) to explain how they came to have disparity in wealth in their lifetime. As per the author, to become rich, one must be
- Financially literate. Understanding cashflows and taxes play a major role.
- Invest in assets and not liabilities. As per the author rich people acquire assets while the poor and middle class acquire liabilities, but they think are assets. The rich buy assets. The poor only have expenses. An asset is defined as something that brings money.
- Keep expenses low, reduce liabilities while diligently building a base of solid assets.
- Rich people buy luxuries last, while the poor and middle class tend to buy luxuries first.
- Employees earn and get taxed and they try to live on what is left. A corporation earns, spends everything it can, and is taxed on anything that is left. It's one of the biggest legal tax loopholes that the rich use. [The author himself is a good example here. While he is multi-millionaire, many of his companies have gone bankrupt!]
Major lacuna in this book – While pretending to be an autobiographical account, we never learn what the author did to earn his millions! There are hints of companies started and real estate investments made but no account of how the first investment was made, how things actually panned out or the time taken for the "asset" to mature. To me, that would have added actual value to the book, rather than statements which are of more global nature.
Although there are no real get-rich-quick tips in the book, the overall takeaway from the book is to “keep learning” and “act” on them!
Previously on BookMarks: India in the Age of Ideas