Rich Dad Poor Dad: Book Review

Does the reason why the rich get richer while the poor get poorer lie solely in the capitalist system, or does financial literacy also play a role?

Rich Dad Poor Dad is a bestselling book written by Robert T. Kiyosaki, a successful entrepreneur. The book is based on the author’s real-life experiences and the lessons he learned from his two fathers—one highly educated but financially struggling, and the other with minimal formal education but significant wealth.

The narrator introduces his two fathers simultaneously. One was highly educated and intelligent but remained poor, while the other, who never finished eighth grade, accumulated substantial wealth.

Logically, the highly educated father should have been wealthier, but his attitude toward money and financial illiteracy held him back. For instance, he would say, “The love of money is the root of all evil,” whereas the rich dad believed, “The lack of money is the root of all evil.”

• Poor Dad: “I can’t afford it.”
• Rich Dad: “How can I afford it?”

The narrator explains that when you say, “I can’t afford it,” your brain stops thinking. However, by asking, “How can I afford it?” you activate your brain to find solutions.

• Poor Dad: “Study hard so you can find a good company to work for.”
• Rich Dad: “Study hard so you can find a good company to buy.”

One father encouraged discussions about money and business at the dinner table, while the other considered the topic inappropriate during meals. These contrasting attitudes toward money shaped their financial conditions.

Key Lessons from Rich Dad Poor Dad

1. The Importance of Financial Literacy
   Middle-class individuals often struggle financially because they acquire liabilities that they mistake for assets. A liability takes money out of your pocket, whereas an asset puts money in. Understanding this difference is key to mastering cash flow.
2. Adapting to Change
   The world is evolving rapidly. Wealth is no longer determined by land ownership, as it was before the industrial revolution. Today, information is wealth. Those who possess timely and relevant information hold power, and those who fail to adapt risk being left behind.
3. Overcoming Fear of Financial Loss
   Fear of losing money prevents people from investing. The author states, “For most people, the reason they don’t win financially is that the pain of losing money is far greater than the joy of being rich.” Failure should inspire winners rather than defeat them. He draws an analogy from Pearl Harbor, where a great loss ultimately fueled America’s rise as a world power.
4. Beating Laziness
   The author argues that a little greed and desire can help overcome laziness. Many people grow up believing that wanting more is selfish, but ambition drives progress. The desire for a better life fuels innovation, hard work, and education. The key is balance—too much greed can be destructive, but without some desire, progress stagnates.
5. The Principle of Reciprocity
   If you want something, start by giving. Give money, and it will return in multiples. If you want knowledge, teach others. If people aren’t smiling at you, smile first, and soon, you’ll be surrounded by smiles. This principle applies to both financial and personal growth.

Conclusion

Rich Dad Poor Dad challenges conventional wisdom about money, work, and education. It provides valuable insights on financial independence, encouraging readers to rethink their approach to wealth-building. Whether you’re an aspiring entrepreneur or simply seeking financial stability, this book offers practical lessons that can reshape your financial future.