Uncovering Rich Dad Poor Dad's Wealth Secrets

One of the most impactful books I have ever read is Rich Dad Poor Dad by Robert Kiyosaki. This book was eye opening the first time I read it. The lessons in the book made so much sense to me and seemed like something I would definitely implement throughout my life. I now read this book once a year and want to share with you the most impactful principal I learned from reading Rich Dad Poor Dad.

“You must know the difference between an asset and a liability, and buy assets.”

A lot of people do not know what assets and liabilities are. Simply put, assets put money into your pocket and liabilities take money out of your pocket. Assets make you wealthier and liabilities make you poorer.

“Rich people acquire assets. The poor and middle class acquire liabilities, but think they are assets.”

It is through gaining assets where wealth is built. You will want to work hard and save your money so that it can be invested in assets, not liabilities. This may be harsh but becoming wealthy is no easy task. It today’s culture it is very difficult to avoid liabilities as they are all around us in our daily life. I’m not advocating for you to totally avoid these things but to go about obtaining them in a certain manner.

Something the rich have that most others seem to not is a thing called delayed gratification. Delayed gratification is the ability to resist the temptation of an immediate reward in favor of a larger or more valuable reward in the future. The way I look at assets and liabilities is that it is actually ok to have both. What you want to do is build up a strong foundation of assets that will easily pay for your liabilities.

An example of this would be purchasing a new car. Without strong assets, a car payment will take money out of your bank account each month leaving you with less money to invest. Why not invest in a rental property and use the cash flow from that property to pay for a car payment. This way you will be left with both the cash flowing rental property and a new car. This is a win win situation.

Look for opportunities like this in your own life. Obtain assets and avoid liabilities. Wealth will follow.