The most obsolete idea
is go to school, get a job, work hard, save money,
get out of debt and invest for the long-term in the stock market
See, why would you save money
when they're printing trillions of dollars?
The gap between the 1% and 99% is massive.
You see it's not just money,
you have to step back and look at the bigger picture.
So what do you do?
In every one of us there's a poor person,
there's still a poor person inside me.
There's also a middle-class person
and the middle-class person wants security
they want that steady paycheck.
And there's a rich person
And they're all inside of us except that...
It's not taught.
It's- you're taught to go to school, get a job and get a paycheck.
Not taught how to get rich.
If you've read Rich Dad Poor Dad, my rich dad refused to pay me.
He said the paycheck
was one of the most damaging things you can take in your life.
He says the moment you take a paycheck you're an employee
and that's the mindset.
So my rich dad never paid me.
It drove my poor dad, you know, a government employee nuts.
"You got to pay people, you got to pay people"
And rich dad was not saying that the paycheck was bad,
he says he didn't want to be a slave to money.
So as an entrepreneur,
you know, if rich dad folded
I just try another company.
I don't need a paycheck.
I don't need anybody to take care of me.
If my government doesn't like me I move to another country
because they need entrepreneurs there.
So the entrepreneur is not so much the business,
the entrepreneur is really the mindset and the skill sets
and the different set of rules.
You see, I don't operate small business
does not not operate in the same rules as big business.
Entrepreneur is a mindset first,
a skill set and rules.
And depending upon whether you're an employee or small business
the rules are different,
the mindsets are different, the skill sets are different.
If you could say one thing to somebody whose never been an entrepreneur
and they're thinking about making the leap of faith
into becoming an entrepreneur,
what could you tell them?
Well, I'll just tell them the same thing that happened to me.
You know, my last paycheck, I still remember it clearly
it was one of the worst and the best days of my life
and I was in Puerto Rico,
I was in, I was working for Xerox
and my boss gave me my last, it wasn't a paycheck it was a bonus check
I think it was about 30,000 bucks
taxable, that's the only problem with that.
So I get this check and I went, "Holly mackerel."
You know, I mean, so I was excited
but I was also disturbed.
And so this other guy comes up to me, his name was John
and John says to me says to me this,
"you're going to be back." I said "Why?"
he says, "because you're going to fail."
I looked at him and I said, "look...
few expletive words
Because that's what he did, he left Xerox, failed and he came back.
I said, "look...
You fail and you came back
but I'm going to fail and I'm never coming back."
and that's the attitude.
- Do you know what I mean, - yeah
If you say, "Well, if I fail I'll go back to mommy and daddy"
then that's what you'll do.
So if you fail, that's when I became an entrepreneur because I had no money.
I had no money for years
Yeah, I didn't have a paycheck
But that's what my rich dad encouraged me to do.
He says when, when you don't have this paycheck
you get hungrier, smarter and it's a test of your character
will you become a crook? Will you become dishonest?
Will you cheat and steal?
Or will you become a better human being?
So really that's the benefit of becoming an entrepreneur
you really find out who you are
when you don't have anything.
So you always have to look at the big picture.
Too many people look at, "well, what's, what's going to happen to me?"
When you look at the big picture, you're also going to know
that when something bad happens something good is going to happen.
But you gotta prepare for whatever is coming
If you think the next 20 years will be like the last 20 years
you're going to get creamed.
You know, when you and I go to the supermarket
and we buy a carton of milk
We always check for the expiration date.
But most people do not check for the expiration date on their brains
Instead of getting out of debt I get into debt.
I just refinanced 300 million in debt
I went from 5% to 2.5% interest
I made a fortune.
Every month more money comes in because my cost of money has gone down.
So while some financial experts are saying get out of debt,
I'm saying learn how to use debt.
See when I came back from serving in Vietnam
in January of 73
and the first thing my rich dad said to me was,
"Go to school to learn how to invest in real estate."
It wasn't real estate, it was how to use debt and taxes
debt and taxes make the rich richer.
Debt and taxes make the poor and middle class poorer.
So all the rich guys who are doctors and lawyers or...
you know, those guys, they're getting creamed
- and they don't know why - doctors are getting creamed?
Oh, yeah, they're making more money but the take-home is less
You know, my doctor just yelled at me
he's happy, he says, "Oh, guess what I finally made a million dollars."
And I said, "Yeah", this is just three weeks ago.
And so I said, "Yeah, well how much you pay in tax?"
He says, "$750,000 in taxes."
So his net was about $400,000
That's not bad
but when I make a million bucks, I keep a million bucks.
And the reason is because I don't make it by working for money.
See if you work for money your taxed.
So that's why lesson number one in Rich Dad Poor Dad
is the rich don't work for money.
What we do instead is we create businesses as entrepreneurs.
We acquire real estate.
I don't invest in the stock market
So the reason is because as entrepreneurs
I have more control over my income,
how much I make and how much I pay in taxes.
And because I'm an entrepreneur as well as an investor in real estate
I pay zero tax.
So every time I make let's say a million dollars as an entrepreneur
I immediately invest it in real estate, and I have a 4 to 1 step up.
So I put a million dollars in real estate, I get four million from the bank.
That's why I love banks.
But the banks are screwing everybody else
you know, terrible but it's good for me.
I thought you said when you print it's good for you
but when you print it's bad for people that work for money.
Because when you print savers get creamed
and people who work for money get creamed.
When they print debtors get rich.
You see, debt and taxes make the rich richer
and debt and taxes make the poor and middle class poorer.
When we have obsolete ideas we get obsolete results.
So what's happening for most people
the idea of going to school,
getting a job, working hard, saving money, getting out of debt,
buying your house because it's an asset and investing for a long term.
It's obsolete.
The world has changed, the world changed in 1971
when President Nixon took us off the gold standard
and money became debt.
What if we get rid of school then what would happen?
Would it be better if we had no educational system at all?
No, I'm saying education was more important before, it's just obsolete.
You know, there's Moore's law that...
Moore's law which states information doubles every 18 months.
In other words, everything is obsolete, 18 months.
So, and this is a recent phenomenon.
So when you come out of school, you're already obsolete,
and that's why I'm the old guy,
you know, I meet my friends, I went to Harvard.
Yeah, I went to Harvard. I said,
"Yeah, that was how long 50 years ago?"
Today the banks are charging you interest to save money.
In other words, the banks don't want your money
because they've printed too much of it.
And that's why there's bubbles and stocks and bubbles in real estate and all this.
People are dumping the cash.
Because as I said in here, "Savers are losers and cash is trash"
And yet people are, "Well, I want a high-paying job."
Well, that's an obsolete idea.
Get out of debt, it's an obsolete idea.
You should learn how to get into debt How to you use debt to get rich
And they'll never teach you about taxes.
The reason the 1% is way up here and the 99% are going this way
is because when you print money two things happen
inflation and taxes.
It's crushing them.
And any entrepreneur that thinks "I'm just going to make money
and start a business and make a lot of money because that what we talk about
They really have got to smell the roses man.
You know, that's not what the real entrepreneurs are doing.
Most entrepreneurs, there's 28 million small business owners in America
24 million are, are one person entrepreneurs.
They're called non-employee entrepreneurs.
So that because, and that's what happens
is when people don't really understand what an entrepreneur does.
So most people are self-employed, but they're not really entrepreneurs.
The self-employed pay the highest taxes of all
and nobody tells them that.
Yeah, it's also called the entrepreneurial spirit
but what we're actually talking about
was there's no such thing as a bad economy.
You know those externally, you and I, we all have an external economy.
But we also have an internal economy
and the will power is to change our internal economy.
So for me, I can see the good, I can see the bad
I don't really give a damn.
Because I'm going to be rich anyway.
But a poor person with a poor personal economy
All they're going to see is a bad economy.
Because they don't know how to make money in any economy.
And a middle-class person, they have a middle-class economy
you know what they want is a nice house, a steady paycheck
and the job and the car.
And so when you take their job away to them that's disaster.
Well since an entrepreneur doesn't have a job anyway, it's no big deal.
So all I'm saying to people is what Bucky Fuller taught me.
There's always two sides, you know what I mean,
you know to use plural at minimum two.
So if you think the economy is bad, it's because your economy is bad.
If you think that steady, you know, employment is important
- then you'll see an economy without jobs. - Your economy
Your economy versus the external economy.
Where you control VS where you can't control
I can control yes, it's called, it's called an internal focus
versus an external focus.
So the real entrepreneur has an internal focus
but if they fall down they say, "Oh, this is good
because I'm going to go up higher."
You know, the average person will fall down and
say "Oh, I'm going to take some Prozac"
Or, or the- or somebody has the mistakes, all the mistakes don't matter well
Mistakes, mistakes matter, it means you didn't know something.
But a real entrepreneur whether they fall down
or they go, they always can go up
They can stand back up and go higher.
That no matter what happens to them
they got stronger and better and smarter and happier.
But a person with a weak internal mindset
Is that they're so afraid of what happens, it generally happens.
Like, you know, people who are afraid of losing their jobs
they generally lose their jobs.
- You know what I mean, - yeah,
no doubt, so everything comes through you
Yeah, so the entrepreneur first job is control inside here
not outside there.
The moment you take that paycheck you're an employee
You've got to be stronger than that.
It's about inside control.