Robert Kiyosaki: don't save money

The author of the financial bestseller, "Rich dad, poor dad" has released a new book for those who want to achieve financial independence. Robert Kiyosaki, whose views are often criticized in the book "Second chance" calls again to forget about common rules to get richer. So, he argues that to save money — madness, and higher education is a waste. Published excerpts from the book.

As I found my second chance

In the fall of 1985 the flow of life carry us (Robert Kiyosaki and his wife Kim) in Australia, where we found people who liked what we were taught. We used games to teach socially responsible business and investment.

By December 1985, one of the workshops that we held in Sydney, brought us a small profit, and this is one reason our love for Australia and Australians. We released all of our past, and the flow of life brought us to Australia, where the Australians gave us a chance to become good teachers.

As soon as Kim realized what is our purpose, organize our educational company began to expand. We have offices in New Zealand, Canada, Singapore and Malaysia. In the United States, our business is booming.

Ten years later, in 1994, we sold this business to our partner. At the time Kim and I have reached financial freedom. Kim was 37 and I — 47. We have achieved financial freedom without regular work, without government support and without pension portfolio stuffed with stocks, bonds and shares of mutual funds. When people ask us how we achieved financial freedom without the traditional investment and pension plans, Kim realized that it was time to use our new second chance.

Following one of the generalized principles of Buckminster fuller (the principle which acts in all cases without exception), we have established the following business company, which is today called Rich Dad. A generalized principle that we have followed, States: "the more people I serve, the more effective be."

Filled with the intention to serve more people, Kim began to improve the game CASHFLOW® and I sat down to write the book "Rich dad, poor dad". The official opening of the Rich Dad company was held on the day of my 50 years, April 8, 1997. Our mission is worded briefly and clearly: "to Elevate the financial well-being of mankind."

Serve more people your business

In the process of using your second chance I'm struggling to follow this generalized principle when taking decisions on matters of business. Instead care only about their own enrichment, I began to accustom myself to think about how to enrich not only themselves but also others. This generalized principle helped Kim and me to make the decision to sell a us based company, engaged in conducting seminars, partner.

Despite the fact that the business was quite successful, its capabilities were limited in terms of the number of people we could serve. It was not easy to leave this business that we loved, have successfully built and made profitable. Nevertheless, we intuitively knew it was time to move on. It's time to look for ways to serve more people.

In 1996 was presented the first commercial version of our game CASHFLOW® in Las Vegas, and Singapore. The next step was the development of a marketing plan of sales of this game. In 2004, the New York Times was devoted to the clubs of the game CASHFLOW® article titled "the Game of money is valued above all", where, in particular, it was reported that the number of such clubs around the world has exceeded 3.5 thousand. Many of these clubs still exist, continuing to serve such a large number of people, which we with Kim could never cover on their own.

Q: If you want to serve more people, why don't you offer the game for free?
About: We considered the option of using government grants to Fund the production of games, but it would be like trying to educate people to the way of thinking of the poor dad, instead encourage them to apply entrepreneurial thinking style rich dad. Also, when people offer something for nothing, it often does not cause the desire to escape from poverty. They have formed the mentality of the beneficiaries, which destroys initiative and sense of personal responsibility.

For those of you who seriously intends to take advantage of the second chance in terms of their relationship to money and life, I suggest to ask ourselves "How can I serve more people?" instead of asking the question, "How can I make more money?".

Words can make you rich

Injustice is financial ignorance. Today almost all people in all parts of the world, stealing their wealth through the financial system, that is with their money. And the saddest thing is that most of them do not realize it. The main means of obtaining wealth are work, savings, and investments in securities market.

Millions of people mired in poverty or are struggling to survive financially simply because use the wrong words. Millions of people are in a desperate financial situation because of treat their liabilities as assets. Definition rich dad was simple and straightforward. He said, "Assets put money in your pocket. Liabilities take money out of your pocket."

At nine years old I already knew what was going to become a rich man, as rich dad explained to me the importance of financial words. I knew that I would be rich, because I know what is the difference between assets and liabilities. At the age of nine I knew that my main task is to acquire assets and minimize liabilities.

The entrepreneur works for assets

Millions of people are experiencing financial difficulties because call their house and car assets, instead of regarding their liabilities. But the saddest thing is that most people have no idea about what actually is an asset.

Instead of focusing on the word savings, we focus on the word debt and used the debt to acquire assets. When children are taught that you need to "go to school, work hard, save money, buy a house (because your house is an asset), to get rid of debt and invest for long terms in the stock market", their blind words. People can't see the world of the rich on the opposite side of the coin.

Take the time to make a written list of all of their property and to divide its assets and liabilities. A test of belonging to assets and liabilities is very simple: if you stop working, which will bring you money and that will pull money from you?

The majority of the poor and the middle class only have liabilities but no assets. Most retirement plans are not assets. This is an unfunded liability, of which money begins to flow out at best once you can not work. In a time when people are starting to look for assets they can buy or build, their world begins to change. They begin to see the invisible.

Self-employed persons work for the money. Entrepreneurs from quadrant work for assets. For example, a real estate agent belongs to category self-employed persons, because it works for money or a Commission. Entrepreneur involved in real estate is working to acquire properties that are assets and produce cash flow.

Find your favorite assets

In any financial statements, assets are divided into four main classes: business, real estate, securities and commodities. Take time and ask yourself, in the assets of the class (or classes) you are most interested in. In this case, the answer may not be right or wrong.

A second chance begins inside of you. I suggest you allocate enough time to explore all the four asset classes, so you can delve into the subject and to carefully study them. If it turns out that love at first sight does not cause any one of them, then take a break and wait until you find an asset class that can love.

Always remember the iron rule: "the best investments are never advertised". The key word here is never. The best investments, regardless of asset class, are always offered to insiders, representatives of a narrow circle. You should set a goal to become so good investor, rich and knowledgeable to enter into the narrow circle and to access insider information.

As you may know, insider trading on the open market, which is the stock exchange is illegal. However, insider investing in private markets is perfectly legal. For example, when the Chinese company Alibaba became public, its shares were sold to outsiders. But the lion's share of the profits received by the insiders long before Alibaba was offered to the public.

Be generalists

Unfortunately, statistics show that nine out of ten new businesses do not survive the first five years. The reason most businesses fail is that traditional education prepares students specialists. But entrepreneurs need to be generalists.

Q: what is the difference between specialists and generalists?
About: the Expert knows a lot about them. Universal knows a little bit about a lot of things.

Q: And why professionals fail?
A: They don't have enough biznesowego required to be entrepreneurs, skills that typically do not teach in school.

Q: Name one of the skills that do not teach in school.
About: Entrepreneurs should be able to sell. If they do not know how to do this, you will not be able to feed themselves. Many people don't quit their jobs because their income in this place higher than one that they can get from sales.

Q: What do you mean?
About: Suppose a person receives a salary
10 thousand dollars a month. If he becomes an entrepreneur, his revenue must be not less 50 thousand dollars.

Q: Why does the revenue have to be not less than 50 thousand dollars?
About: This is a simple rule of thumb. The ratio should be approximately 5:1. For every dollar you earned as an employee, you must obtain at least five times more income as an entrepreneur. The only way you will be able to feed yourself and your business. When you become an entrepreneur, you have costs that have no employees. This is the cost of production of the product, the costs of doing business, taxes, fee for professional services, etc.

Studies show that most entrepreneurs earn less than the people they hired, if you count the number of hours actually worked. For example, many entrepreneurs take up the challenge after everyone finishes. The employee goes home and enjoying life, and working day trader is just beginning. Employees and self-employed persons are professionals. Entrepreneurs are generalists.

Do not be afraid of their debts

Most financial experts advise people: "Get rid of debt. Live without debt." Advice to live debt can be considered good for people without financial education, however it can not be considered sound financial advice.

In the world of money there are two types of debts:
1. Good.
2. Bad.

Simply put, good debt makes you rich and bad debt makes you poorer. No wonder millions of people without financial education (and the United States as a state), have accumulated mountains of bad debts. For example, when I buy an apartment building, then to Finance the transaction using debt. If these apartments every month to bring money into my pocket, this my debt is good. But if my apartment every month bring me losses and I have to pay the mortgage, then the same debt becomes bad. Let me repeat: only the cash flow allows to determine good or bad is a particular debt.

Don't save money

Many financial experts keep saying: "Delay, delay and again delay, denying myself in everything." A man in his right mind will surely ask: "Why save money when States print them?". By saving money, we lose our wealth.

Q: But what's the opposite of Deposit savings? The accumulation of debt?
A: Yes And no. Debts in themselves do not solve the problem. They are only part of the solution. Opposite of the storage savings is the so-called "velocity of money". Most people "Park" their money in places where they are stored in the form of savings or investment in pension plans. The smart people make their money work, blowing them in turn. Simply put, when the cash flow stops, they lose their value. If the money works, their value grows.

Train your mind

I am professionally engaged in teaching since 1984. The more people I taught, the more I become convinced that there are four types of intelligence:

1. Physical. Outstanding athletes have a good capacity for physical training. Physical intelligence is concentrated in the muscles. As the players in Golf, you need to develop muscle memory.

2. Mental. Most students who perform well in school, have a good capacity for mental learning. Mental intelligence is in the brain. That's why people say, "Let me think about it".

3. Emotional. This type of intelligence is called the intelligence of success. The better the man developed emotional intelligence, the better he copes with life's difficulties such as fear, loss, anger and boredom. Emotional intelligence is concentrated in the stomach... or in our gut.

4. Spiritual. A highly developed spiritual intelligence have artists, poets, and religious leaders. It is located in the heart.

Rate the four kinds of intelligence. Use the scale from 1 to 10, where the highest rating is 10.

1. How strong is your physical intelligence?
2. How strong is your mental intelligence?
3. How strong is your emotional intelligence?
4. How strong is your spiritual intelligence?

If you type more than 30 points, so you have a very good opportunity for a second chance in your financial life. If total score is below 30, then find a friend that you trust, and discuss their strengths and weaknesses. For a second chance you'll need to develop and use all four of his intellect.

Adjust the attitude to wealth

For many years television producers called me, asking if I would like to organize a similar TV imageshow. They wanted me to take the "poor man on the street" and turned it into a real rich man. Every time the discussion came to the same questions: "Can it be done?" and "How could we do that?" and every time it ended on the same question: "How a caterpillar becomes a butterfly?".

The fact that the external and internal transformation are two totally different things. Repaint an old house or to pick up a beautiful outfit a snap. All this is only the external transformation. But how to turn a man from poor to rich? One makeup and clothes for this little. It requires inner transformation. A poor man becomes rich in the result of transformation — and this process is much more complicated a simple painting.

Internal conversion is a bad material for television, realityshow because they are invisible. These transformations are associated with changes in the internal context — what people think about themselves, their money and decisions. I know it is possible to show, yet the TV execs, and I myself, have not found suitable for this purpose is format.

Much of the blame for today's economic crisis lies with the people who want to look rich in appearance, but are not rich inside. A striking example of the evils of this human desire was the subprime mortgage crisis.

Millions of the poor and the middle class, not having work, income and assets were given loans that they could buy a house or to refinance the debt for the existing house with the help of loans, which they most likely will never be able to repay. Banks then "Repack" these subprime loans into derivatives and sold it to "weapons of mass financial destruction" to the money hungry world.


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In other words, the desire to look rich outwardly may cause UPS and downs in real estate markets and securities and lead to the rapid growth of consumer debt credit cards (and student loans).

This book is not about external transformation. The idea of this second chance has nothing to do with rebuilding the kitchen, painting the house, new clothes, getting rid of a few kilos of excess weight and return to school to get an education and a paying job.


Author: Robert Kiyosaki


P. S. And remember, only by changing their consumption — together we change the world! ©



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