Welcome to the June edition of our Best Book of the Month series. The book we picked for this month is Robert Kiyosaki’s “Rich Dad Poor Dad”.
This book is a BEST SELLER: #1 New York Times and #1 The Wall Street Journal and has sold over 26 million copies.
The main objective of the book is to make a reader understand how crucial it is to have a sound financial education. Kiyosaki stresses the fact that we don’t receive this kind of education in our schools. We basically learn about everything from history to maths and geography but teachers don’t spend a minute on financial responsibility and money.
Kiyosaki’s writing style is very friendly and easy to grasp. The book uses a story to highlight the different attitudes towards money and life. The two dads’ influenced Kiyosaki’s life tremendously. His real father is portrayed as the ‘Poor Dad’ and his friend’s father is the ‘Rich Dad’.
One of the main topics of the book is the difference between an asset and a liability.
The statement, that an individual’s house is not an asset but a liability has caused both criticism and praise in the media.
According to Kiyosaki:
- Assets are “…properties that bring money into your pocket” and
- Liabilities are “…anything that takes money out of your pocket”
“During hard times assets feed you, and liabilities eat you”. – Robert Kiyosaki
If a house costs you money it is considered a liability to the individual and an asset to the bank (because it puts money into the bank). A rental property on the other hand is considered to be an asset if it produces positive cash flow.
There are 4 different types of people in the world of business. Checkout this video by Robert Kiyosaki to find out what these four types are and more importantly what makes them different…
Benefits of reading June’s best book of the month…
- This book will revolutionize the way you think about assets and liabilities.
- “Rich Dad Poor Dad” is an eyeopener when it comes to the importance of financial education and literacy. If you can’t read a balance sheet or bank statement you need to learn it. In order to master your financials and understand where the money is going it is essential to educate oneself. Banks know how to read statements and that gives them a huge advantage over financially illiterate people.
- This book will also give you insights about the importance of entrepreneurship and investing. Whether you decide to invest in stocks, bonds, commodities or other businesses it is important to learn the skills and understand the correlations.
- How employees receive their checks only after paying taxes, social security and health insurance whereas corporations spend first and than pay taxes.
- If you’re willing to change your thinking, leave your comfort zone and experience a whole different perspective this book is definitely an asset for you.
Have you read any of Robert Kiyosaki’s books? What was your biggest take away? What title do you suggest we review in our next best book of the month series?