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Rich dad & Poor dad : Financial Literacy

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Rich dad & Poor dad : Financial Literacy

Rich Dad Poor Dad” one of the best books written on personal finance. If you are in search of financial advice, I recommend this book. This book has changed the perspective about money among millions. Here I list you important take away from the book.

Take away:
The Rich Don’t Work For Money, The Rich Have Money Work For Them. When you build wealth, there are two things that you need to do:
1. Aim to own more and more assets over time
2. Stop trading your time for money

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To understand this let us understand the following, an asset is something that puts money in your pocket, creating a positive cash flow. A liability is something that takes money out of your pocket.
Assets are things like stocks, bonds, businesses, and rental real estate. Liabilities are things like cars and your primary residence. It’s not an asset because it is taking money out of your pocket every month. When you start, you are probably trading your time for money. Use that income to buy more and more assets.

The more assets you own producing money for you, the less you have to rely on your day job to get income. That’s what Robert Kiyosaki means with rich people make money work for them.
When the income from your assets is higher than your monthly expenses, you are wealthy, not only wealthy in terms of money but also wealthy in terms of time. While everyone else works, you can do whatever you please.

It’s Not How Much Money You Make, It’s How Much Money You Keep. If you want to be rich in the long term, invest in your financial intelligence.
You see, if you want to build a skyscraper, you need a strong foundation. It would help if you had a bigger foundation for your skyscraper than for your one-floor apartment.
The problem is that many people try to build their skyscraper on a foundation for a one-floor apartment. What happens if your skyscra per is getting higher and higher? Your beautiful skyscraper collapses. You will build it up multiple times.

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Every single time it will collapse. You will try again and again and again. However, your skyscraper will keep falling.
Why? Because your foundation is not strong enough!
First, build your financial intelligence, your foundation, then the money will follow. Don’t try to build your skyscraper on your one-floor apartment foundation. It will not work. When you’re building your skyscraper on the right foundation, you will build true wealth.

Actually Keep The Money You Earn, Besides that, if you have a solid, you should not feel the urge to spend all the money you earn. When you get a high income from your day job, but you spend it all again, you are not getting ahead with your finances. With the Rich Dad Poor Dad mindset, you use your money to buy freedom instead of things. When you are continuously spending your money on things that do not generate income for you, you stay in the rat race.

Mind Your Own Business
A lot of people use their life to grown someone else’s business. If you like your job, please keep doing what you are doing! If somewhere in you is the soft voice that says, ‘I want to start my own company,’ get over that initial fear and do it!! You don’t have to quit your job immediately. You can, for example, make managing your money your part-time job. I can recommend it, and it’s a lot of fun!
Besides that, creating websites to source different income streams is a great way to get to be your own boss, plus making some money in the process.

Taxes and The Power of Corporations
Regular taxes are only there since the beginning of the 20th century to make the rich pay more taxes. However, the rich got smarter, resulting in the middle class working hard, and paying the most taxes. The rich have their investments often in cooperation, so they have to pay fewer taxes.

The Rich Invented Money
The concept of money is created by humanity, and it is an illusion to which we all contribute. This might help you to create a little more distance between you and money. Many people are too attached to money to create maximum wealth.
Your brain is your strongest asset. If your brain is well trained, it can create enormous wealth for you! Never stop learning, always keep growing as a person, and your wealth will grow with it!

Work To Learn, Don’t Work For Money
J.o.b. Is an acronym for ‘Just Over Broke.’ Why? Employees work hard enough not to get fired, and employers pay employees enough not to quit. If you work to acquire skills that will serve you later, this will have more value than working for the money and not enjoying it. Apart from these take away “Rich Dad and Poor Dad” is to attain literacy. The points listed above were grown out of my understanding of the book, if you need to create your own understanding try the book for yourself. It would be a life altering experience.

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