When I was in college, I had a dream of becoming rich. However, I didn't know how
to go about it because just because I studied economics it didn't teach me what to do with
my money to build wealth. So I started looking for knowledge outside the university and came
across a book that has become a classic among personal finance guides: Rich Dad , Poor Dad by
Robert Kiyosaki. From the moment I studied his knowledge, everything changed for me:
I knew exactly what to do with my money to become rich by simply copying the teachings of the rich
and implementing them myself. I don't need to mention that since then everything changed for
me financially and that's why today I'm going to show you my 7 most powerful lessons from Rich Dad,
Poor Dad that helped me to completely change my financial situation and build wealth.
But before we get to the main topic of the video, first of all welcome back and if you are new on
our channel... We are the Finance Nerds and we try to help you to fix your finances and spread
our knowledge in saving money, budgeting and investing, and if you like the video and want to
support us, hit the Like button on this video! But first, in case some people don't know the
book, what is it about? It's about Robert Kiyosaki and his 2 fathers. One is poor, that's his real
father and the other is rich, that's his best friend's father and he tells the differences
of both and how both influenced Robert's way of thinking about money and investing.
In doing so, he realized 3 things: 1. you don't have to have a high income
to be rich, 2. rich people make money work for them instead of the other way around and 3. rich
people acquire assets and the poor/middle class acquire liabilities which they think are assets.
Now the 2nd point will already be known to you, but the 1st point that you don't need
a high income to become rich will seem very contradictory. Because
basically you think that it depends on how much money you earn to become rich,
but it is much more important how much you keep. So it's much more important what you do with
your money once you get it, how you manage not to let your money be taken away again,
how you manage to keep it longer and how you manage to make your money work for you.
To do that, you need the right knowledge and the right attitude, because without these two things,
it will be very difficult for you to become rich or build a fortune,
which is why the most important asset is your mind, but more about that later.
Now after this short introduction, let's talk about the 7 teachings that I believe will have
the biggest impact on your finances. The Rich Don’t Work For Money
As I said at the beginning, one of the biggest differences between rich and poor is that the
rich make their money work for them. There are many ways to make your money work for you
and it also depends on your position in the cash flow square. If you are in the cash flow square,
for example, in the area of business owner, then you make your money work for you by
paying wages to employees who then do your work. But since most of you are probably in Employee,
we'll talk about how you can make your money work for you in Employee. To do this,
you use your monthly income to buy assets. Assets are
1. stocks 2. bonds
3. income-generating real estate 4. notes (IOUs)
5. royalties from intellectual property such as music, scripts, and patents
6. anything else that has value, produces income or appreciates, and has a ready market
We all need financial Education Just like me, many others leaving school,
college or university have zero financial skills. They don't know how to invest their money,
they don't know about taxes, and they don't know how to manage or budget their money.
Yet you need financial knowledge to work wisely with your money, or as I just said:
make your money work for you. So use your time wisely and set aside 20-30 minutes a day for your
own education. Did you know that many successful people schedule an average of 5 hours a week to
work on themselves or their skills? You can do the same. I can recommend you e.g. Blinkist,
there you can find book summaries on maximum 10-15 pages and get the most
important information of each book within 20 minutes per day. You can use our link
from the video description, with this link you can test Blinkist for 7 days for free.
The Difference between the rich and the poor So what are the differences Robert has found
between the poor and the rich, and why is it important to know them?
It is important to know them in order to question one's own behavior patterns and to
be able to steer them in the right direction. The biggest difference is to recognize how
the rich and the poor use their money. This is exactly what I talked about in the last video:
The poor divide their money as follows: 1. wants
2. needs 3. investments
Whereas the rich divide their money as follows: 1. Needs
2. investments 3. Wants
Do you see the difference? I think it’s obvious. This is how the rich manage to make their money
really work for them and the poor/middle class rather work for their money or incur debts,
because often they acquire their Wants by taking out loans.
Change Yourself
Remember your mind is your greatest asset and how you can further build your greatest
asset is as follows: 1. read every day
2. get into action 3. say goodbye to bad habits
4. overcome your fears 5. get out of the comfort zone
6. get a mentor or learn from people who inspire you.
How Taxes benefited the rich It's a little crazy, because actually
the more money you make, the more taxes you pay. Nevertheless, the fact is that taxes basically
hit the poor/middle class more than the rich. This is because the poor/middle class are taxed before
they spend and the rich are taxed after they spend, by being able to deduct the expenses of
their businesses or assets from their taxes. This means you not only make your money work
for you when you acquire assets, you even get tax preference or you
can have expenses written off over them. Robert Kiyosaki often reminds us of the
4 pillars to getting rich: 1. Accounting: The ability
to manage your money wisely. 2. Investing: The ability to
invest your money profitably. 3. understanding the market:
The ability to understand supply and demand.
4. Law: The ability to understand e.g. the tax laws.
Keep your Day Job to make money for your assets You do work for your boss first and then for the
government through taxes, but you don't have to become an entrepreneur to become
rich nor do you have to have an incredibly high income. I'm not saying it can't help,
but it's not necessary either. Focus on using your current job to acquire
assets and make sure that once a dollar of yours goes into assets,
it never comes out of there. Your assets are your ticket to financial freedom, so use
your current income to invest in stocks, real estate, equities, index funds, gold and so on.
Work To Learn
Ok what do I mean by work to learn? Well it is so, many work from a certain point only
with the goal of getting their monthly salary, but what completely falls by
the wayside is their further development. If you develop yourself and work on your skills,
opportunities will open up for you to better position yourself financially later on. Robert
recommends looking for jobs where you can develop your communication, sales skills and marketing
skills because "The most important specialized skills are sales and marketing". These skills are
closely related to how much revenue the company you work for makes or perhaps your own company.
And if you now want to know which 7 Assets you should buy, watch the video on the right side!
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