Rich Dad’s Guide to Investing is a book inspired by Robert Kiyosaki’s real life story. He talks about his two dads- first one poor (his own dad) and the other one rich (his friend’s dad) He jots down their stories and how each one had an impact over his life. He also mentions the ways in which they carved his thoughts about money and investing.
This book also works as a guide to attain financial independence at an early age. It is loaded with information and experiences to achieve the goals. The author has specifically shared the teachings that only rich people impart in their kids that help them become wealthier and more successful.
The lessons mentioned below form the basis of Rich Dad’s Guide to Investing. Read on to know more!
Stepping into the shoes of the rich
Have you ever thought about why some people are so rich and some do not even have the means to cover basic expenses? The author explains this by stating a fact. He says 90% of people earn 10% of wealth while 10% of people own 90% of it. The reason being these 10% of people focus on making themselves financially literate. The author wants to etch financial education in the minds of budding investors. The earlier you start the journey of self-education and setting financial goals, the better! All this comes down to looking at your income and setting goals based on that income.
By stepping into the shoes of rich investors, Kiyosaki means adopting their mindset to become rich. Now let’s understand what this mindset is. To think and act like a rich investor means investing in assets and business rather than thinking about landing good jobs or focusing on savings. Rich people believe in making multiple investments. They buy various businesses and assets and consciously pay tax on the pre-tax earnings.
If you want to step out of the rat race and become a part of the 10% people, then you can read audiobook summaries available on this topic on various book summaries websites.
Gaining financial literacy to understand the difference between assets and liabilities
This point might seem silly to you. But in order to understand the difference between the two things is crucial to run a successful business. Some entrepreneurs mistake asset liabilities as assets and as a result invest in them. Treating your assets as employees who work for you to produce income is the right way to invest in assets.
This can only be achieved when people start taking financial literacy or financial intelligence courses. It is often believed by schools and parents that if a person is smart and intelligent, then he must be good with money too. Unfortunately, that is not the case. Financial intelligence is a full-fledged course in itself. It needs to be learned. The result of lack of financial intelligence is not just seen in budding entrepreneurs but is also a problem for many wealthy and successful entrepreneurs. It’s high time that schools come up with some courses on it.
Different investors require different types of skills
In Rich Dad’s Guide to Investing, Kiyosaki simplifies the two sets of investors: Inside and Outside for us. Outside investors are further divided into accredited investors and qualified investors. Accredited investors fulfills all the legal formalities and requirements to make any amount of investment. Qualified investors fulfil the above definition and also have an additional skill. They are financially educated too. While an insider investor has little to do with being rich. The most important requirement to become an inside investor is owning a business.
And the people who think owning a business is rocket science are wrong. Starting a business requires three things- a mission, team that will help you achieve great height, and a leader. After this requirement is fulfilled, a businessman needs to learn to communicate and to dress up appropriately. Learning to communicate and dressing appropriately goes a long way. These two requisites are as important as becoming financially literate.
If you want to learn about investment techniques, then you can read audiobook summaries available on various book summaries websites.
Kiyosaki offers Rich Dad’s Guide to Investing overview by stating that a rich person always makes the money work for him/her rather than the other way around. He has also placed prime focus on the importance of financial independence, financial literacy, and various other types of investments. Another key point is to choose if you want to play safe, comfortable, or rich. The moment you start prioritising is when your mindset starts transforming. Shifting your focus from accepting that you can’t afford something to thinking about how you can afford it makes all the difference.