Simple and easy Rich dad poor dad summary

Simple and easy Rich dad poor dad summary

Santosh Gairola   By   santosh |  updated :   2 Nov 2017
The art of getting rich is really simple. You can easily understand it by Rich dad poor dad summary.

Robert Kiyosaki defined it beautifully in his book. Today we will explore the Rich dad poor dad summary in a simple and easy way.

This post will give you the key reason why only a few people in this world become super successful while other keeps wondering and almost end at living average life.

This post is based on rich dad poor dad outline.

Robert Kiyosaki had two dads, Don't get me wrong.

When I say two father; it means-

  1. First one is his own dad
  2. The Second one is his friend's dad. Whom he likes to call dad

Robert was closely connected to both of them. So he started taking the life lesson from them.

His own dad was a Ph.D. degree holder whereas his friend was just a high school grader.

Both dads had different mindsets, So they keep teaching different life lessons to Robert.

His own dad taught him that Money is the Root cause of all evil.

On the other side, his friend dad taught him that Lack of money is the root of all evil.

His first dad always stops him to think about the expensive stuff. He used to tell Robert that they cannot afford it.

Whereas his second dad always encourages Robert to make a plan how they could afford that stuff.

This thinking approach made Robert more creative and logical.

His first dad told him that you should study hard and get good marks so that you could easily get a job.

Whereas his second dad used to tell him that you should also study hard to acquire a new skill which could help you to open your business so that you could provide job to others.

Since Robert observed his both dads and decided to follow his second dad who later became the richest man in Miami.

Following his second dad also made Robert rich in the Future whereas his first dad remained at an average life.

One thing that Robert understood from his rich Dad is the art of getting financial freedom or financial literacy.

The art of getting financial freedom means understanding the major difference between assets and Liability.

According to Robert Rich Dad

What is an Asset?

Assets is something which brings out cash inflow for you.

In simple terms anything which is helping you in making or earning money is an Asset.

What is Liability?

Liability is something which brings out cash outflow for you. Anything which takes away your hard earned money is Liability.

People get rich because they collect assets while other people become average or poor because they collect Liabilities.

Let's make it clear. Suppose there are two friends, Jack and Bob.

Both works in a tech company and both get the equivalent salary.

jack used to spend his salary on new clothes, Gadgets including phones, and Bikes which are actually Liabilities, not assets.

Such stuff gives a mirage of getting Rich; In reality, they are sucking his hard earned money.

For example, a high budget phone has high maintenance cost in comparison to a low budget phone. Same time it is bringing cash outflow for you due to paying your phone bill.

On the other side, Bob used to invest his hard earned money on the stock, bonds, real estate or in any particular skills which could enhance his personality and helps him to earn more money.

After few years Bob becomes Millionaire whereas jack continued with his average life.

You need to understand the cash flow of an average person.

  1. A Poor man earns money and spends all money in his expenditure.
  2. An Average class man earns money and spend all his money on Expenditure and Liability. He will buy expensive stuff to project himself as a successful person.

It makes sense that many middle-class people are almost living poor's life. They used to think that their house is their assets.

In reality, your house is not making you any money, in fact, it is a Liability, not assets unless you start renting from it.

Now let's see the cash flow for Rich People

Rich earns their money and they INVEST their money to build assets which could bring them easy money.

They will like to invest their money in Stocks, real estate, bonds or in producing something valuable which could give them a good return.

After making their assets which brings them money in a continuous cyclic basis then they will spend their money into their Liabilities.

This increases the sources of their income. which ultimately makes them richer.

Robert Kiyosaki Rich Dad Poor Dad Summary

If you really want to understand Financial literacy and get rich you need to understand one thing.

it Doesn't matter how much you are earning? what matter is how much you are spending and to whom you are spending.

You need to come out from the thinking of a consumer and convert it to thinking of an investor or producer.

Rich dad poor dad moral lesson.

  1. People complain that their low paying salary is responsible for their financial conditions whereas it directly depends on the way they spend or invest their money.
  2. You need to increase your source of Income, not your salary. The real fact is that when people salary increases their expenditure also increases. Hence their financial state remains same.

what is rich dad poor dad all about

Robert Kiyosaki easily defined that rich people invest their hard earned money in making assets while the average class or poor class people spend their money in collecting Liability.

One of the major thing I would like to conclude that Assets are build by Taking huge but calculated risk in lives .

Without having the risk-taking abilities you cannot grow.

The problem of poor people is that when they earn their money they spend it on purchasing liability. Like they will easily get ready to buy a PlasmaTV set.

Whereas It will become hard for them to invest their money in some trade or acquiring any valuable skills.

Rich Dad poor dad Conclusion

Rich dad poor dad summary is simple; it defines how to get financial literacy by differentiating the major difference of Assets and Liability.

You have to be odd to be number one. Rich dad Poor dad exactly defines the secret of Greatness in you and how to get successful in lives?

If you have even a little interest in getting rich Then I would like to recommend you to read this book.

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Thank you, Keep smiling, stay blessed. Take care of yourself.

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