Rich Dad’s Who Took My Money

Sharing my learnings from the book, Rich Dad’s Who Took My Money by Robert Kiyosaki

Rich Dad’s Who Took My Money by Robert Kiyosaki

Continuing his franchise with this eighth volume, investor Robert T. Kiyosaki with Sharon L. Lechter, C.P.A., addresses those who are serious about taking control of their money and their lives. Rich Dad’s Who Took My Money?: Why Slow Investors Lose and Fast Money Wins! is packed with the kind of Rich Dad’s advice that has made Kiyosaki a wealthy, best-selling author. This time he shares the secrets to achieving ultra-high investment returns, noting that this extreme approach isn’t for everyone. By integrating asset classes (business, real estate and paper assets) instead of diversifying, investors build synergies that accelerate leverage while protecting the cash flowing through the asset. Part one includes advice from nontraditional viewpoints: dairy farmers, gamblers, Newton and Father Time, as well as insurance agents and bankers. With those enlightening perspectives, part two shares secrets for power investing, with a focus on cash flow rather than capital gains. Transitioning from saver to educated investor is fun, Kiyosaki says, although he admits that finding good investments is hard work. But by playing this game, not following the herd, and getting your money to work for you, Kiyosaki is convinced you’ll learn more as you go along, ensuring a much better shot at success.

• To secure your financial future, you need to use a combination of assets to generate money fast, all while keeping it out of the hands of financial advisors and stock market sharks.
• Many people want to put off their money worries until they’re older. But we only have a limited time to get our finances in order. The painful truth is that our money-earning lives are divided up into four quarters.
  • The first quarter stretches roughly from the age of 25 to 35
  • the second from 35 to 45
  • the third from 45 to 55, and
  • the last from 55 to the time we’re expected to retire.
• Nobody wants to reach those final two stages without having their finances in order. So, at some point in those four quarters, we should work toward financial independence.
• The standard advice is: save, invest in mutual funds, and hold these for the long term. However, the author argues, this isn’t the way to reach financial independence – it’s too slow and far too unreliable.
• to build wealth, you need to use several asset classes at the same time and become a “power investor.”
• To be a power investor, you need to make use of more than just paper assets – you need to include business or real estate as well. Rather than just holding a “diversified” stock portfolio or a mutual fund, the mega-rich integrate two or three of these different assets.
• you should look for assets that pay back their original cost within five years – through profits if they’re a business, rents if they’re real estate, or dividends if they’re paper assets. Then, they should continue making money for you, long after they’ve paid for themselves.
• Like a professional gambler, an investor needs to get their own money “off the table” as quickly as possible. this is a lot safer than investing for the long term; leaving your own money on the table just puts you at risk of losing it all in the next market crash.
• You should learn to see the world from a banker’s perspective. Bankers never hand money over to strangers without first seeing their financial statements and credit ratings. You can propose the most wonderful schemes in the world, but if your finances aren’t in good shape, you won’t get a loan. It doesn’t matter about your qualifications either. The only thing they want to see is that you’re smart with money. Bankers also require some kind of insurance on any money they lend.
• There are four key reasons why people don’t succeed financially.
  • because of two words: “I can’t.” 
  • too many people think investing should be easy
  • it’s easy to fall for traps that the rich set for the poor.
  • too many of them invest without ensuring that their money will still be there when they need it.