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Rich Dad Poor Dad Pdf

Rich Dad Poor Dad Pdf: I had heard in my childhood that money isn’t everything, but it’s something big. This story is true and good. Pay close attention if you want to earn money, become rich, and stay rich. It’s the story of a person named Robert T. Kiyosaki. When he was in the first grade, he studied in a school where the children of the rich attended. Their parents came to pick them up in expensive cars, and they had expensive items with them.

Robert’s father was different. He was a teacher with a Ph.D. He had a good education but earned less. Robert said, ‘My dad is a poor dad.’ Robert went home and one day, frustrated with school, he wondered why he didn’t have all those things. He asked his father, ‘Dad, how can we become rich?’ His father replied, ‘You have a brain, use it.’ What can a first-grader do?

Financial Wisdom: A Journey from Toothpaste Tubes to Wealth

He went to his friend Mike’s house and asked him how to earn some money. They noticed that there was as much toothpaste in the area as there were empty toothpaste tubes. They took those tubes and put them on a hot gas stove. They were trying something. Robert’s real father, who was different, would often ask what the children were doing when he came home. Robert would say, ‘Dad, we’re going to make money, make coins.’ Many lectures were given. It’s illegal, don’t do it. Robert was discouraged. Sometimes we think it’s not for us, and our mind drops the idea. The mind stops thinking about it, and the file is closed.

But if you listen to Rich Dad, he says you should put your brain to work, and figure out how to buy this thing. As you tell your mind, it starts to work. Brain exercise begins. So, you should always keep your mind active. Real Dad believed that you shouldn’t take risks, and Rich Dad said you should learn to manage risks. Calculate risks in terms of the term. Dad, the thief, used to say that you should study a lot, get a degree, and secure a job. But Bridge’s Dad said you should study and learn how money works. Don’t work for money, but start putting that money to work. At the age of nineteen, Robert decided to listen to Rich Dad, learn about money, and keep growing in life. Now, let’s talk about what to learn and understand.

Financial Literacy: Differentiating Between Assets and Liabilities for Wealth Creation

Rich Dad, who is, tells you that there is a big difference between becoming rich and staying rich. If you want to understand a little, want to understand cash flow, you first need to understand assets and liabilities. Rich says that assets put money into your pocket, and liabilities take money out of your pocket. If you want to become rich, you need to buy assets. If you want to live a middle-class and lower-class life, you must buy liabilities.

Any rich person, whether educated or not, like Rich Dad, who is only in eighth grade, but is financially literate. He is financially sound. He knows everything about how money works, where to invest money, and how much benefit I can get. Every person has an income statement, a balance sheet, and a cash flow. The income statement divides income and expenses, which shows how much is left and how much is going. There are two parts to the balance sheet. How it’s done?

If there is another liability, it means your assets are making money for you. You are earning money. For example, the stock market investing in bonds, or your intellectual property liability. This means you are only paying off loans. So first, let’s understand the cash flow of a poor person. For a poor person, the only source of income is their salary. Salary comes at a fixed time, and as soon as it comes, expenses begin. Expenses include paying rent, food, and clothing. All the money goes into expenses. There is hardly any savings left.

Cash Flows: Poor, Middle-Class, and Rich Perspectives

If you look at the balance sheet of a poor person, there is a column for assets. It is always empty. All their money is in liabilities. In other words, income comes and goes. Nothing is saved. This is the cash flow of a poor person. The cash flow of a middle-class person is not very different. Here too, the assets column is empty. Middle-class people follow a pattern. They live in rented homes. After some time, they realize they should build their own home. To earn money for their home, they need to save money and make some down payment.

They gather as much money as they can. After buying a house, they start spending on it, investing in interiors, buying good furniture, getting other items, and buying a good car. All of this goes into the liabilities column. They keep filling it up. Loans for cars, home loans, and credit card debt, loans keep piling up. Money comes in as income, but it goes straight into liabilities. There is no savings. The assets column remains empty.

Now let’s understand the cash flow of the rich. What is the cash flow of a wealthy person? If you look at their income column, there are three or four things. They don’t rely solely on salary. There is interest income, capital gains, dividends, and royalty income. When it comes to expenses, they have the same expenses as everyone else.

They have to pay taxes, eat, and buy clothes, educate their children. All of that is there, but when you look at their balance sheet, you’ll see that their liabilities are much lower, and their assets are numerous. They have credit cards and loans in liabilities because if you are doing business, you need loans, and you have expenses too.

The Wealthy Way: Diverse Income Sources and Valuable Financial Lessons

In assets, they have stocks, bonds, intellectual property, and much more. They run a business as well. So, in total, the cash flow of a wealthy person is different. If you want to hear the story of a rich dad, rich people have three types of income sources.

First is ordinary income, which is salary. It’s there, but they are not solely dependent on it. There’s interest income, and real estate income, which keeps coming regardless of where they live. And the third is the portfolio, which includes the stock market and government bonds. Why did so many rich people become wealthy, whether it’s Jeff Bezos, the author of this book, or former President Donald Trump? Because their money was growing, they were making money from their money.

Talking about McDonald’s, they are not just making money by selling burgers. McDonald’s is making money from real estate investments too because they own a lot of real estate properties worldwide. Three amazing lessons are shared on the results board. The first is not just about earnings but learning because learning is a lifelong process, and the more you learn, the less you know. Financial learning is crucial because there will be mistakes. Learn from those mistakes and move forward. The third is about money. Don’t work for money; make money work for you. If you want to be financially literate, you should read, “Rich Dad Poor Dad“.