Rich Dad, Poor Dad book introduced me personal finance – how to view money and use it to develop my wealth.
I read more personal finance books and articles after it, and realized how some of its lessons are too generalized.
However, most of the lessons are sensible and worth using as reminders whenever I make financial decisions in life.
Therefore, let me take you through the 5 lessons I learned from the book Rich Dad, Poor Dad:
Rich People Do Not Work For Money
Rich take care of the goose that lays golden eggs. They won’t even think of killing it to take out all its eggs at once.
They will instead save the eggs for hatching into goslings and get more golden eggs when those goslings become geese.
Just like that rich people work smart, not hard.
Ap Warren Buffett said “If you don’t find a way to make money while you sleep, you will work until you die.”
Tesla, Inc. is this system of Elon Musk just like SD Eastern Bhutan Ferro Silicon Pvt Ltd is for Goop Sonam Drukpa.
Reduce Your Liabilities and Expenses
When assets put money in our pocket, liabilities and expenses take them out of our pockets.
But wealth is the excess of assets over other two. Isn’t it wiser to reduce liabilities and expenses and increase the other then?
Increasing liabilities and expenses, and then reducing assets to look rich takes nowhere but to a financial disaster.
Your friend driving an expensive Seltos might be having a negative asset balance with a car loan liability.
I don’t purchase things simply other people are also using. I buy only if I need. Don’t be a poor man driving a nice car; man in the car paradox.
Time is the Most Valuable Resource
One thing I realized reading the Rich Dad, Poor Dad book is the value of time and how it’s more authentic currency than the paper money.
All of us have 24 hours a day and 7 days a week. This is same no matter whether you’re Elon Musk or a beggar.
However, not all people make same money. It is determined by an hourly rate which is being fixed by the market.
It’s the market value of your time. You can increase it by making yourself more valuable, solving problems and being in a place where you are appreciated.
You can also increase it by doing things early due to compounding effect like Warren Buffett did it by stock investing since 10.
These people can control their time. They can also afford not to work like poor people.
So, if you need a tree, the best time for planting one was 20 years ago and the second best time is now.
In the end having control over your own time is the freedom, which is one of the main sources of happiness.
Be Surrounded with Smarter People
Marissa Meyer has said ‘if you are the smartest person in the room, then you are in the wrong room.’
What a strong realistic sentence!
Rich people keep contacts of different smarter people. It’s how they learn new ideas and principles.
Organizations also keep on changing their business partners that do not bring values for them.
What stops you moving away from that same people who don’t bring any value besides just negativities in your life?
Keeping in mind the law of attraction, I don’t chat much with friends who only complain, gossip, boast etc.
People say you are an average of 5 people from your circles. To become smarter you must be with smarter people.
Otherwise, what you gain waddling and swimming with ducks when you want to be an eagle that soars above the sky and beats the wildest storm?
You Will Know as Much as You Read
‘No one really cares for us once we are out of school or college…..’ wrote Denkar’s Getaway the other day.
How true!
We are on our own either to hunt for food or be hunted, just like animals in the Sahara Desert.
They are also like us; fighting for survivability. We must remain useful for the society. We must always update views, skills, attitudes etc.
What can be better than reading good books? Moreover, it’s only once we are out of school, we know what we actually need in life.
‘Mitochondria is a power house of cell’ isn’t as useful as knowing how to file your tax, compound interest, how money works etc.
We were never taught how to make, manage, and keep the money. But we spend most of our lives working for it.
So, isn’t it important to learn real estate, building multiple income, trading stock, etc. just like we learn how Pythagoras theorem works?
Rich Dad, Poor Dad – Is Good for You?
The author of Rich Dad, Poor Dad even filed for a corporate bankruptcy few years ago.
An unexpected thing after teaching millions and millions of people how to make money. Right?
People also wonder if anything about his rich dad is true. Nothing much to prove otherwise.
Even if everything is true, he can’t demean his poor father just like that. I feel the poor dad is also true and honorable in his own terms.
If I don’t judge the hand that points where the moon is, the book is worth reading at least for beginners.
However, once you are done with it, read the Millionaire Fastlane by MJ DeMarco for a balanced view.
Did you read the Rich Dad, Poor Dad book? How did you find it? Please share things you like the most.
