Cautions on “Rich Dad” Robert Kiyosaki
Posted by Frugal on May 11th, 2006
Many thanks for one of my readers, BlueDaze, for posting this link in the comments:
http://www.johntreed.com/Kiyosaki.html
If I recall correctly, I visited this very same link probably three years ago, when Kiyosaki only had his very first book on “Rich Dad, Poor Dad”. I got all the negative information on Kiyosaki, which I never thought could be possible.
About Rich Dad’s books, I have only read his first book “Rich Dad, Poor Dad”. The only things that I walked away from is a good, but basic summary of how everyone makes money. I must say that he was quite good at putting these things together as four quadrants of E/S/B/I (employee/self-employed/business owner/investor), and explained the cashflow & taxes of each quadrant. But it was nothing new to me. The rest of the pages is simply not helpful in getting a person to become a better B/I, or even a better E/S for that sake. A couple of my friends are so enamored by his books and him, and even lent his books to me, and talked to me about his books constantly. My only reaction is almost puking. The Bible says NO IDOLS. If you have ever contemplated on that commandment, it really means no idols of ANY kinds, whether it is a wooden statue, or a singer, or a book-writer, or any persons, or any physical thing. I think no one should ever adore another to an exceeding extent.
Robert Kiyosaki has a lot more books after his first one. When I am in the bookstore, I never want to lay my hands nor my eyes on those books, so that I won’t waste a second. In fact, I did pick up the Rich Dad’s series of OPM: Other People’s Money by Lechter because I was going to write a negative article on the book. Actually, it turned out to be so much different than Kiyosaki’s empty talk. Tagging the book as Rich Dad’s series is really degrading Lechter’s book.
Unfortunately for the unwitting readers, this guy, Robert Kiyosaki, pretty much speaks of anything possible that can happen, and of course, these readers will be even more enamored by his “correct” prophecy. Any valid predictions should always be properly stamped with the predicted timeframe. If you don’t give any timeframe, or give a wide timeframe, you will most likely eventually be correct. Just let time approach infinity, and all kinds of things can happen.
Kiyosaki’s negativity towards E or even S is simply not correct. A good education and good grades in school will give you a good paying job. With a good salary and a saving habit, you can go very very far (as I myself have demonstrated, saving $360K in 9 years). If there is anything that I regret not doing is that I should have listened to my parents, and given more thoughts to becoming a medical doctor. If you know how much medical doctors can make, you will not be complaining to be a S (self-employee). The savings that can result from the high salary or self-employee as being a doctor are probably 2X to 5X of my savings. That really makes a huge difference.
To all the young people who are still in school, I advise: To become wealthy, you need to start with first penny, and start with solid learning in school. Don’t think that you can study later. Life does not give you the luxury of going back in time. The only time that you can study in school is NOW or probably never. Going back to schools after having a family is extraordinarily difficult and only put unnecessarily emotional and financial stress on yourself and your family. Mathematically speaking, studying to become a medical doctor or an accountant or a lawyer, has a much higher probability of becoming a (multi-)millionaire, comparing to daydreaming of becoming a successful business owner, or winning the lottery.
P.S. You must click on the title to be able to comment on this post. I don’t know what happened to Wordpress. Somehow it had a problem with this post.
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May 11th, 2006 at 6:36 am
Very well written. Although I must admit that I used to be RK’s fan… Matter of fact, his first book taught me how to think outside of the box and do a bit of extra other than my day job… I have to agree with you about his negativity toward E and S. And early solid education is absolutely essential. After all, knowledge is what enables us to be successful. And without a good learning habit, you can’t aqquire the knowledge you need to run a business… Too many people dream about being rich but forgetting that not all of us have what it takes to start a business from scratch…
But I do agree with RK on one thing - buy a smaller house and use the money to invest…
May 11th, 2006 at 10:51 am
Yes, house is both an asset and a liability. Both aspects must be well-understood. Some people focus either on liability only or focus on asset aspect only. That tends to lead one to make over-conservative or over-aggressive decisions.
May 12th, 2006 at 3:31 am
Star Money Articles for the Week of May 8…
Here are interesting posts and news this week from the MoneyBlogNetwork members and beyond: MightyBargainHunter highlights 50-year mortgages. Five Cent Nickel covers rules regarding no-interest family loans. Blueprint for Financial Prosperity explains …
May 12th, 2006 at 9:50 am
Yes, he’s got part of the equation right on a house being a liability. I think the real insight is to take the perspective that you need to have assets that generate the income to cover your liabilities. Once you are thinking that way, you realize that the liability is your housing expenses. Those can either be in the form of rent, with or without utilities, or a house, with a mortgage, insurance and maintenance costs. The house is an asset that partially covers the need for shelter, which is a liability in a more general sense.
May 12th, 2006 at 12:09 pm
Yes, I couldn’t agree with you more, Dale.
May 26th, 2006 at 6:55 am
Thanks for sharing the post. I was mistaken before when I thought that this guy was could do no wrong
June 26th, 2006 at 6:05 pm
i dont know if RK is an idol or a fish but he stresses education through out the book. for you to say:
“To all the young people who are still in school, I advise: To become wealthy, you need to start with first penny, and start with solid learning in school.”
thats no different then what RK stresses. he even closes the book on the last page by saying:
“Education and wisdom are important. Start early. Buy a book. Go to a seminar. Pratice. Start Small.”
it sounds like your mad or jealous. I dont know how you could say the same thing as him but not find any value in his books. your either very smart and somewhat ignorant or very stupid and extremly ignorant.
June 26th, 2006 at 7:31 pm
I am simply trying to give the readers other perspectives. You could follow the link to see read about other things. I am entitlted to my own opinion, and same as you. I fully respect your opinion. Different opinions are what makes the society great. I’m not mad or jealous. I’m too busy to be wasting time on those negative emotions.
Obviously no books or no one will tell you in black & white that education is no good. I’m simply making the comment that there are E & S choices that can be very good for you, but those choices rely on even more professional educations.
I hope the readers can be analytical and objective, and critical on everything that I write too. I appreciate that you have put those quotes from books to rebutt me. But I don’t appreciate your labelling me as mad or jealous. We are all adults here, and we can talk things in a very objective ways. If I’m wrong, I admit it. Obviously, I can’t be right 100% of the time, right?
March 30th, 2007 at 3:20 pm
> … don’t think that you can study later. … Going back to schools after having a family is extraordinarily difficult and only put unnecessarily emotional and financial stress on yourself and your family.
You hit this on the head! I am 37 and attempting to rescue a dead-in-the-water career by going to a good MBA school (part-time) with 1 kid and 1 kid on the way, a full time job and a hour plus commute. Yes, if you do have a shot at planning, get your education as early as possible.
April 1st, 2007 at 8:33 am
Kasa,
I admire your bravery in going back to school. I know I certainly don’t want to do it, simply because of the time stress that it will put on the family.
October 18th, 2007 at 6:53 am
I would like to know what’s Robert Kiyosaki’s estimated networth.. I mean, if u want to judge weather what he wrote on the book matches the reality, just look at how much money he’s making…
To me? making money does need an essense of luck. LoL
October 18th, 2007 at 6:55 am
I would like to know what’s Robert Kiyosaki’s estimated networth.. I mean, if u want to judge weather what he wrote on the book matches the reality, just look at how much money he’s making…
To me? making money does need an essense of luck. LoL
Peace…
June 3rd, 2008 at 9:04 pm
Do you know what the most precious asset one has is? For what you [author of this article] have written, you obviously don’t know anything about it. So you saved in 9 years 360k, and this without counting of what you put in, which I bet it was quite a bit. In nine years, let’s assume you made a profit of 360k, well I congratulate you! Welcome to the middle class life! Keep saving pennies and hopefully your kids would only have to take care of you when you have little left in life. The most important asset one has is TIME. This is one of the greatest differences between rich and poor or middle class people. They think in terms of TIME, not just money. I bet you that in those 9 year that you supposedly made 360k, I would make millions just because instead of just saving, I would invest not only on real-state, stock market, or any other investment vehicle, but on my emotional and financial intelligence. I haven’t done it before because 9 years ago I was 12 years old.
Robert Kiyosaki is not an idol, but is giving people a very profound and different way of looking at the Capitalism’s Machinery, and that is priceless. It is not who he is, but what he does by pointing people in the right direction. And then, people like you, who are just complaining and looking at the wrong and negative side of the issue, are pointing people towards the side that keep people thinking inside the box.
Everybody!!! Be aware of people who will pull you to where they have gone just because they don’t really understand the real path to financial freedom. If you read “Cashflow Quadrant” by Robert K. you’ll understand why this kind of people are called cynics, and why you should push them away from you if you really want to be financially free. Life was meant to be abundant, yet, we all need to do our little part by getting a little financial literate so nobody can tell us a story. READ books and listen to professionals, not just somebody who is making some money out of you reading this blog. Be smart, and take control of your life. Greetings from Cuba, USA, Spain. Juan
June 4th, 2008 at 12:41 am
Juan,
What Kiyosaki wrote in the book is probably for you, but not for me since I knew those already without reading his books. For the basic financial intelligences, I bet you can get those from him. There is a thing in probability theory called expectation value, which applies to financial world too. The largest value in those four quadrants is certainly not the same as the expectation value. Brush up your math & financial knowledge.
Regards,