A Quick Review of Rich Dad Poor Dad
What do I like the most? The writer explains the concept of richness and poverty and how to manage money and assets.
The book’s central theme is based on the quality of being rich and has not remained poor. A person having a lower income can also be rich. Rich people make money whereas they employ others. The poor and middle class work for money while money works for the rich. Keeping money is more important than making money. The rich make assets, whereas the poor gain liabilities; they think of one investment. Financial aptitude is necessary to be rich. Apart from assets and liabilities, the human mind is the most critical asset.
The writer explains beautifully the difference between being poor and being broke. Money and its flow go on continuously; once a person knows how money works, he gains power over it and builds wealth. Two emotions always control a person; fear and greed. People are claiming to be not interested in money work 8 hours a day. It is a misconception that a job gives stability in life. It is the intelligence that works at solving problems and producing money. Knowing asset and liability is a must to become rich and remain rich. Assets bring money, and liabilities get expenditure. A person who is illiterate and words and number is the foundation of financial struggle. Knowledge of cash flow is a prerequisite to avoid financial effort. Taxes form the number one expense for the people. Having more money does not solve money problems. Fear often prevents a person from seeking new ways to solve problems. Financial illiteracy does not allow a person to grow and remain rich howsoever; the person is educated and professionally successful. Hence, the focus should be on income-generating assets. Hard work alone is not the key to financial prosperity. One must be able to know how to be benefitted through efforts and hard work. If one is working, everything is alright, but he stops working the graph of getting and receiving wealthy crops. The rich concentrate on asset building while others focus on income statements. An employee has to struggle throughout life for finances. An employer cares to increase the assets and increase the income. The rich take the risk, whereas middle-class poor remain conservative in approach.
To attain richness and remain rich, one must focus on keeping expenses low, reducing liabilities, and diligently building a solid asset base.
The cycle of money works a day and remains active for generations.