Books, Motivation, Success

Effective Life Lessons From “Rich Dad Poor Dad” That Would Make You Rich

Written by Kivihe Dxecig · 5 min read
Rich Dad Poor Dad Book Summary-0176604d

Rich dad poor dad is a world-famous motivational book written by Robert T. Kiyosaki. It is a very worth reading book that makes you ambitious to become successful in life.

Key Ideas of Rich Dad Poor Dad

  1. Rich Dad (the Dad of Robert Kiyosaki’s Best Friend) Poor Dad who is his real – Both dads have framed the author’s mindset about Money, Business, and Investing.
  2. High income is not necessary to be rich.
  3. Rich always make money work for them not they do for money.

Chapters of Rich Dad Poor Dad

  • Chapter 1: The Rich Don’t Work for Money.
  • Chapter 2: Why Teach Financial Literacy?
  • Chapter 3: Mind Your Own Business.
  • Chapter 4: The History of Taxes and the Power of Corporations.
  • Chapter 5: The Rich Invent Money.
  • Chapter 6: Work to Learn – Don’t Work for Money.

See Also: 25+ Important Life Lessons From “Anything You Want” By Derek Sivers


Life Lessons from Rich Dad Poor Dad – Book Summary

  • Poor are poor because they don’t take the necessary risk in doing business that riches do. Even then rich face failures sometimes but they learn from their mistakes.
  • Rich dad teaches the author how people use to do jobs that they don’t even like to do. So that’s why they don’t have the courage to start a business.
  • Rich people always don’t work or start a business for money but to provide the best product or service to peoples that’s why they succeed in long-run business.
  • You can be money-less but not be poor which is eternal.
  • Poor people want instant money they don’t believe in constant struggle. Whatever they do they never think it before.
  • Poor people fear loss. Whenever they get some extra amount, they use it for repair, and another temporary purpose which the author calls a “Rat Race”. While rich people invest the money with proper money management that’s why the rich make money work for them.
  • The art of building wealth is not only earning money but money management.
  • Everyone is controlled by Fear and greed.
  • Poor people work the whole day for a job but don’t want to work an hour for their business.
  • In fact, Job is a deception to become rich which poor people teach their children about whole life.
  • Wise thinking help making money.
  • To become rich can be easy but to sustain is difficult and Assets are the things that keep you rich and more wealthy.
  • Rich people learn too much about business, money, and investing.
  • Rich after investing in business makes money from that business and keeps it up. Some invest in investment schemes that make money work for them.
  • Poor people do continuously struggle for financial needs just because of the illiteracy of financial education.
  • We need to adapt according to changing economic conditions. We have to learn the markets to become wealthy because it is not taught in schools.
  • Accounting is the most important subject to learn like assets mean earning resources and liability means obligations.
  • The available resources should be used to acquire new assets instead of liabilities.
  • The Poor mostly spent money to buy liabilities which makes them poorer by incurring expenses while the Rich always use the money to acquire new assets.
  • Learn these two Sheets: 1. Profit & loss sheet which a list of receipts and expenses and profit is calculated after deducting expenses from receipts 2. The balance sheet consists of mainly two things Assets and Liabilities.
  • Poor people are poor because most parts of the assets are used to set off liabilities. As long as you increase your liabilities your tax payment will increase. For example: read your electricity bills.
  • The higher the Risk the higher the Profit but don’t ever invest in high-risk investments.
  • Your job is separate from the business. Don’t ever believe in a job if you want to become rich.
  • You should do business and make as many as assets you can to become richer and stay rich.
  • Financial problems of Poor people are just because of working whole life for others (Job). That’s why in old age they don’t even have a penny to buy medicines, foods, etc.
  • The Poor has only liabilities, the middle class has small assets but big liabilities, and the rich have more of the assets than liabilities.
  • Poor treated to have assets while they are actually liabilities like house bought on the loan while author advised that assets are such that help you earn money like earning Real estates, copyrights, Books, Notes (IOUs), Royalties from intellectual property such as scripts, and patents
  • A good businessman is the one, who decides without swaying into emotions. Like author never kept emotional thought about any property and he used to sell old and buy new properties.
  • To succeed in any business, you have to take risks and work hard.
  • Why 90% of the business are filed within one year of their start because people don’t plan to run this business for the long run. So, we should make a long-term plan after obtaining full information about our business to succeed.
  • You should take the help of the experience of people who are already successful in the business which you want to start. It only reduces the risk and increases the chances of success.
  • Taxes were introduced to imposed on rich people means those who will earn big income will pay taxes but after some time it was imposed on middle-class people as well.
  • Now, poor and middle-class people pay most of the taxes while the rich evade it because they know the methods to avoid it. e.g. if you are a filer you pay less tax than those who pay more due to Non-filer.
  • Corporate taxes are always less than income tax that’s why rich people who invest in corporate and corporations avail tax exemptions.
  • The authors say the rich are more talented and courageous than the poor and middle class that’s why they do business and investment. Rich people work hard, earn money and learn the art of non-taxation.
  • If you want to become rich and stay rich you need to understand the tax system of your country and learn the tricks of non-taxation.
  • The lack of self-belief is the biggest hurdle in our life. Poor people wait for better times and luck while the rich find their way to be successful in life and business.
  • Not intelligent but brave people will be successful. You need courage more than the brain. Don’t be silly and never get wrong, intelligence is needed but the courage to take risks is also important to be successful in life.
  • You are poor because you do single work for making money and never find other opportunities in life. A good businessman searches for new ways to make money every time.
  • Simply you can use 50-70 percent of your income for your family and 30-50 percent of your income for reinvesting and other opportunities to earn more money same like the author who uses part of his real estate rental income for his family and part of income to use in the stock market to earn more money. The author faces loss sometimes but it never hurts his family budget.
  • Make your business running as it doesn’t need your presence if it does then it’s not a business it’s a job.
  • Avoid unnecessary expenses, reduce liabilities and increase earning assets.
  • You need to understand Business management. Learn these things.
    • Cash flow statement
    • Operations management
    • Workers management
  • Abolish these obstacles in your life as early as possible
    • Fear of losing money
    •  Overcome cynicism (suspicion about profit or loss) stay confident and learn from the related people who already doing it.
    • Stop laziness, sleep well, eat healthy food and stay motivated.
    • Create good habits especially related to your business and making money
    • Stay away from arrogance.

How to get started?

  1. Read good books of successful peoples like Bill Gates, Steve Jobs, warrant buffet, etc especially those who are in the line of business which you want to do. You will learn to do that business as well as bring positivity.
  2. You want to be rich so take advice from riches.
  3. Never talk about money with poor people you will be disappointed.
  4. You don’t need money to earn money but the big thought which can solve a real problem of people.

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