When you think about learning how to earn money like the world’s most famous billionaire’s and dream endlessly of becoming rich, what’s the first thing that you do? You learn. You try your best to find out how to make money, how to invest and manage finances to become financially independent and successful.

In the Internet Age that we find ourselves in today, information is at our fingertips. But perhaps, the information that we have is so vast and complex that it becomes difficult to handle or process. When it comes to learning about things like money and investing, there are a lot of websites, videos and even self-proclaimed money gurus out there who will tell you how to do this analysis and that analysis, and how to triple your money in 60 days and so on and so forth. And when things don’t go as planned, we simply give up on learning about money and think that it is too impossible for us to learn all these new terms and strategies. However, many people, including myself, would resort to handling this data overload from internet resources by reading a good old-fashioned book about money management. One such book, in fact, the first ever book on money management that I read, was Robert Kiyosaki’s ‘Rich Dad, Poor Dad’. The book, which I read as a 12 year old on my uncle’s couch in India during the summer, opened a new avenue and path of thinking and looking at the world and the money around us. The book is filled with many insightful lesson, accompanied by intriguing stories and analogies, and some of these I will share in this overview.

Summary:

Rich Dad Poor Dad by Robert Kiyosaki and Sharon Lechter, emphasizes the value of developing financial literacy from a young age. The author discusses how a person can enhance their wealth by making wise financial decisions and investing in assets throughout the entire book. Robert Kiyosaki’s early years are glimpsed in Rich Dad Poor Dad when he begins to learn about money at the age of nine. The phrase “poor dad” and “rich dad” are references to Kiyosaki’s actual father and a friend of his, respectively.

His friend’s father was an entrepreneur who dropped out of school young and became one of the wealthiest people in Hawaii, but his own father was a professor who made a good living but constantly suffered financially.

Kiyosaki frequently made an effort to comprehend both his rich dad’s and poor dad’s points of view, but it was his rich dad’s counsel that enabled him to learn about finances and amass fortune. The fundamentals of cash flow, balance sheet, income statement, assets, and liabilities are introduced throughout the book in a straightforward, understandable way. One of the reasons the author gives for publishing this book is that he wishes everyone had received the same financial education as he did as a young child. The phrase “the number one and the only rule” is used to underline the significance of understanding the distinction between assets and liabilities and the importance of concentrating on investing in assets. There are ten chapters in Rich Dad Poor Dad, plus an epilogue.

Throughout the novel, Kiyosaki uses fancy cars, or driving expensive vehicles, as an expression of something wealthy people can or should do. He associates consumption with wealth, but never suggests that people spend money they don’t have. In fact, he insists on paying for his own luxuries not with income earned by employment but with passive income produced by investments.

10 lessons from Robert Kiyosaki’s “Rich Dad Poor Dad” that many readers, including myself, found helpful:

• The wealthy put more effort into creating assets that provide revenue than they do into working for a salary.
• Be mindful of your own affairs: To safeguard your financial future, invest in yourself and start your own company or investmnts.
• Financial education’s significance To make wise judgments and increase your wealth, educate yourself about finances and investment.
• Assets and liabilities differ in the following ways: Liabilities deplete your bank account while assets increase it. Think about obtaining assets.
• The importance of cash flow: To gradually accumulate money, concentrate on establishing a positive cash flow.
• Don’t be afraid to take calculated chances in order to increase your wealth, but make sure you do your homework beforehand.
• Avoid falling into debt traps by being cautious when taking on debt to cover commitments that don’t generate income but could eventually become burdensome.
• Fear can paralyze, yet action and overcoming your fears are necessary for success. Don’t allow fear hold you back.
• Accept failure as a chance to learn and grow: Successful people learn from failure and utilize it to their advantage.
• Keep your eye on your objectives and don’t let distractions or doubters stop you from succeeding.

These 10 simple lessons are really key in building a basic understanding and foundation of money management and serves as a way to mentally prepare one for adopting techniques, methods and most importantly, a lifestyle for building wealth.