Rich Dad Poor Dad, explained

“Rich Dad Poor Dad” is a personal finance and self-help book written by Robert T. Kiyosaki. First published in 1997, the book has become one of the top-selling personal finance books of all time. Its main premise revolves around the contrasting financial philosophies and practices of Kiyosaki’s “Rich Dad” and “Poor Dad.”

Here’s a summary of the book’s main themes and concepts:

1. Two Father Figures: Kiyosaki describes growing up with two father figures. His biological father (whom he calls “Poor Dad”) was well-educated and held a stable job, but struggled financially. In contrast, the father of Kiyosaki’s childhood best friend (whom he dubs “Rich Dad”) was an entrepreneur and investor who imparted valuable financial wisdom to Kiyosaki.
2. Assets vs. Liabilities: One of the central concepts in the book is the difference between assets and liabilities. Kiyosaki argues that to become wealthy, one must focus on acquiring assets (things that put money in your pocket) and minimizing liabilities (things that take money out of your pocket).
3. Financial Education: “Rich Dad” emphasizes the importance of financial education and being knowledgeable about how money works. Traditional education often lacks teachings on financial literacy, which Kiyosaki believes is essential for financial success.
4. Rat Race: Kiyosaki discusses the “rat race” concept, where individuals work hard to earn money, but due to expenses and debts, they find themselves stuck in a cycle of continuous work without achieving financial freedom.
5. Entrepreneurial Spirit: The book encourages readers to think beyond traditional employment and consider entrepreneurship or investments as means to generate income. It promotes the idea of making money work for you, rather than working for money.
6. Critiques of Traditional Advice: Kiyosaki often critiques traditional financial advice, such as “work hard, save money, and stay out of debt.” He argues that this approach might not be the most efficient way to achieve wealth and financial independence.

While “Rich Dad Poor Dad” has been praised for encouraging financial literacy and challenging conventional beliefs about money, it has also faced criticism. Some critics argue that the book oversimplifies complex financial concepts or that it lacks actionable advice. Additionally, some question the veracity of Kiyosaki’s anecdotes, as he has mentioned in interviews that “Rich Dad” is a composite character and not a real individual.

Regardless of these critiques, “Rich Dad Poor Dad” has had a significant impact on personal finance literature and has spurred a series of books, games, and seminars based on its concepts.

Did “Rich Dad Poor Dad” receive good reviews?

“Rich Dad Poor Dad” by Robert T. Kiyosaki has elicited a wide range of reactions since its publication. The book has been both praised and criticized, and its reception varies depending on the reviewer’s perspective.

Positive Reviews and Praise:

1. Financial Mindset Shift: Many readers have praised the book for providing a different perspective on money and investing. For them, it offers a break from conventional financial wisdom and encourages them to think more entrepreneurially.
2. Introduction to Financial Literacy: The book is credited with introducing basic financial concepts to those who might not have had exposure to them before. Its simple, easy-to-understand language has made financial education more accessible to the masses.
3. Motivational: Many find Kiyosaki’s anecdotes and lessons to be motivating, encouraging them to take charge of their financial future and seek out additional education and opportunities.

Criticism and Negative Reviews:

1. Lack of Practical Advice: Some critics argue that while the book provides general financial philosophies, it lacks actionable or specific advice for readers to apply in their lives.
2. Over-simplification: Critics have said that Kiyosaki sometimes oversimplifies complex financial concepts, which might lead to misunderstandings.
3. Questions about Authenticity: There have been doubts about the existence of “Rich Dad,” with some claiming that he’s a fictional or composite character. Kiyosaki has indicated in interviews that “Rich Dad” is a composite, which has led some to question the book’s narratives and lessons.
4. Potential Risk: Some financial professionals worry that readers might take excessive financial risks based on the book’s teachings, especially if they dive into investments without proper education or understanding.

In the realm of personal finance literature, few books have generated as much discussion as “Rich Dad Poor Dad.” It has sold millions of copies worldwide and has a dedicated following. However, like many influential works, it is not without its detractors.

For those considering reading the book or applying its teachings, it’s always a good idea to approach it with an open but critical mind and to seek out diverse sources of financial education and advice.

What are some books like “Rich Dad Poor Dad”?

If you’re interested in books that explore personal finance, investing, and wealth-building like “Rich Dad Poor Dad,” there are several other influential titles in this genre. Here are some books that are often recommended for those looking to expand their financial knowledge:

1. “The Richest Man in Babylon” by George S. Clason: This classic book uses parables set in ancient Babylon to teach timeless lessons on money, saving, investing, and wealth-building.
2. “The Millionaire Next Door” by Thomas J. Stanley and William D. Danko: Based on surveys of millionaires, this book breaks down the common habits and characteristics of the wealthy, revealing that they often live frugally and below their means.
3. “Think and Grow Rich” by Napoleon Hill: Another classic, this book outlines 13 principles for success and personal achievement based on Hill’s study of wealthy individuals.
4. “Cashflow Quadrant: Rich Dad’s Guide to Financial Freedom” by Robert T. Kiyosaki: A follow-up to “Rich Dad Poor Dad,” this book delves deeper into Kiyosaki’s philosophy on money and introduces the concept of the Cashflow Quadrant.
5. “The 4-Hour Workweek” by Timothy Ferriss: Ferriss discusses how to escape the 9-5 grind, outsource tasks, and achieve a lifestyle of freedom and flexibility.
6. “Your Money or Your Life” by Vicki Robin and Joe Dominguez: This book offers a comprehensive program for transforming your relationship with money and achieving financial independence.
7. “The Simple Path to Wealth” by J.L. Collins: Collins provides straightforward advice on investing and achieving financial independence, particularly advocating for low-cost index funds.
8. “Total Money Makeover” by Dave Ramsey: Ramsey offers a step-by-step plan to get out of debt, save money, and build wealth, emphasizing the importance of living below one’s means and avoiding debt.
9. “The Intelligent Investor” by Benjamin Graham: A classic in the field of investing, this book offers wisdom on value investing and stock market philosophy.
10. “The Bogleheads’ Guide to Investing” by Taylor Larimore, Mel Lindauer, and Michael LeBoeuf: This book provides practical advice on investing, advocating for a passive approach based on the teachings of Vanguard founder John Bogle.

These are just a few of the many books available on personal finance and investing. Each offers its own perspective and set of recommendations, so it’s beneficial to read a range and determine which philosophies and strategies resonate most with your personal financial goals and situation.

Who is Robert Kiyosaki?

Robert Kiyosaki is an American businessman, investor, and author best known for his book “Rich Dad Poor Dad.” Born in 1947 in Hilo, Hawaii, Kiyosaki is of Japanese descent. He attended the U.S. Merchant Marine Academy in New York and served in the Marine Corps during the Vietnam War. After the war, he worked in sales for Xerox and then started a company that brought to market the first nylon and Velcro “surfer” wallets, which enjoyed some success.

Kiyosaki’s claim to fame, however, is his “Rich Dad” series of books, which share lessons he says he learned from his “Rich Dad,” the father of a childhood friend, contrasted with teachings from his own father, whom he refers to as “Poor Dad.” These lessons revolve around personal finance, investing, and the importance of financial education. The “Rich Dad” series emphasizes the acquisition of assets, financial literacy, and entrepreneurship.

Over the years, Kiyosaki has faced both praise and criticism. Supporters applaud his approach to financial education and his push for thinking outside traditional financial norms, while critics have questioned the veracity of his “Rich Dad” anecdotes and some of his financial advice.

Beyond writing, Kiyosaki has been involved in various business ventures and real estate investments, and he has also created educational materials and seminars based on his financial philosophies.