Inspiring Experience and Important Principles of Finance Management

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Rich Dad Poor Dad by Robert Keyosaki advocates the importance of financial literacy (financial education), financial independence and building wealth through investing in assets, real estate investing, starting and owning businesses.

Robert Keyosaki states clearly that increasing one’s financial intelligence (financial IQ) to improve one’s business and financial aptitude.

The title Rich Dad, Poor Dad refers to the two main male influences that Robert had as a child, his poor dad, actual dad, who worked at a steady job for a living and his rich dad  friend’s dad who ran a multitude of businesses. Also, the difference between the mindset of rich and poor regarding money.

“There is a difference between being poor and being broke. Broke is temporary. Poor is eternal.”

This book is not only about money. It’s about how we are taught to think; how we are programmed by schools, family, and other members of the surrounding community to look at the rich as materialistic and opportunities as risks.  

The book boards six lessons explicated to Robert by his rich dad

Lesson 1: The Rich Don’t Work For Money

If you read the title as the rich don’t work for money, this is not what really mean! The rich in fact do work, and they work pretty hard. The idea is that they don’t work for money but they work to learn things. Things that can easily be applied to make money over and over again. 

Lesson 2: Why Teach Financial Literacy?

This section redefines the word “asset”. An asset is something that generates income, while a liability is anything that has costs. In other words, by this definition, your home is not an asset but a liability. It may have cash value, but it doesn’t generate income. Assets are forms of passive income that you control, like a rental property.

Robert has stated: the first step towards getting out of the rat race is to understand the difference between an asset and a liability. Concentrate your efforts on purchasing assets that generate a steady income while keep your spending and your debts to a minimum. This is what he expressed by saying: mind your own business!

Lesson 3: Mind Your Own Business

The point of this chapter is that a financially healthy individual should be spending their spare time not spending their paychecks. Also, investing as much of it as possible in assets. 

“Wealth is a person’s ability to survive so many number of days forward—or, if I stopped working today, how long could I survive?”

While keeping your current job, begin thinking about your own Business. Robert advice several times through this chapter, not spend all your income. Build yourself a diversified portfolio of assets and you will spend later when these assets make you enough.

Lesson 4: The History of Taxes and the Power of Corporations

Rich Dad Poor Dad illustrate mechanism by which the rich minimize their taxes is the following:

Company owners:  First, Earn money, second, spend their money and finally pay their taxes. In construct, company employees first,Earn money second, pay their taxes and finally spend what they have left!

The chapter misrepresents several fundamental facts about taxation. There’s a big difference between forming a personal corporation and buying a company car for use with that corporation. 

There are some advantages of keeping money in a corporate structure as an individual person. Mostly for minimizing taxation on reasonable expenses related to money you earn independent of employment.  

Kiyosaki described his lifestyle by buying Porsche as an example of avoiding tax, but he ignored the complications of unreasonable expenses. Governments won’t always consider luxury cars as a corporate expenses!

Lesson 5: The Rich Invent Money

“The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth.”

Lesson 6: Work to Learn – Don’t Work For Money

I do agree with Robert this time. Everyone should strive to learn as much as they can when they work. Learning can transform your understanding of the world build into methods of starting your own business and being self-employed. 

Even Einstein said: “The only source of knowledge is experience”. Experience shifts and leverage people to fulfill themselves and success.


The book does a great job teaching how to think about work and money, especially its early parts.  It emphasis the importance of being self-determining and being thrifty. 

Rebert presented very well the the accounting basics in the first 3 lessons. Later on his theories become too ideal and more close to be more motivational that educational.

Today, the economic system isn’t set up for all of us to earn enough capital that we can develop our own passive income streams. 

“To be truly rich, we need to be able to give as well as to receive.”

In fact, You need some strong starting capital to do that. Where do you get that capital? Usually at a traditional high-paying job. Kiyosaki earned his starting capital by being one of the top five salespeople at Xerox.

At long last, I might not agree with all Robert’s money making principles that he explains in his book, but still there is much knowledge to be gained from his experience and point of view. I really enjoyed reading Robert’s top seller and I highly recommended.

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