Robert Kiyosaki!

Rich people make money

The place with the most money

is where the money is respected.

The more you value for money,

the more opportunities you have to earn. — Brian Tracy

In each of us is hidden great potential, innate talents.

What holds us back, however,

is our lack of confidence.

By the time we leave school,

most of us know that the real world outside

of school requires more than grades.

Words such as “brave”, “courageous”, “bold”,

“skillful”‘, “bold”, “resolutely talented”…

are the important words in the story of the future.

We are not the scores…

Those good qualities are in each of us,

but “weak”, “incompetent”,

and “incompetent” are also there.

After a year as a pilot for Manne Corps in Vietnam,

I really understanding both of these aspects of oneself.

As a teacher, however,

I realize that it is fear and excessive self-doubt

that are the greatest self-denigration of one’s own genius.

I feel nervous when I see students who know the answer

but don’t have the courage to say it.

Usually in real life it’s not intelligence

but boldness that will get you ahead.

In my personal experience,

financial prowess requires both technical knowledge and courage.

If fear is too great,

boldness will be overcome.

In class, I always push students to learn to take risks,

to let their daring turn fear into power and talent.

Fear will work for some and terrify others.

I find most people when it comes to money want to be safe.

I was faced with questions like:

Why take the risk?

Why should I care about my financial IQ?

Why financial literacy?

And I replied, “Just to have more options.”.

Three hundred years ago,

land was wealth.

So having land is having gold.

Today is the information age.

Whoever has the most timely information will get rich.

The problem is that the information flies around the world at the speed of light.

This kind of newness is not blocked by borders

as it is with land and factories.

It changes faster and more abruptly.

The number of multi-millionaires has grown dramatically.

However, many people fall behind.

Today, I see a lot of people struggling with life,

often trying to work harder,

simply because they are still attached to old ideas.

They want everything to be routine,

they oppose changes.

I know that there are people who have lost their jobs or their homes,

and they blame it all on technology,

on the economy or on their bosses.

Sadly, they don’t realize that it is they who are the problem.

Outdated thinking is their biggest asset.

Simply because they are not aware that their way of thinking

or working is only yesterday’s property,

but yesterday is over.

One day, when I was teaching a group of students

how to play a game called “Cash Wheel,”

a woman happened to come to the class and join the game.

This woman has just been divorced,

has lost her pocket because of the divorce agreements,

so she is looking for a solution.

My “Cash Wheel” game is designed to help people understand how money works.

In playing it, people learn the interplay

between income statement and balance sheet,

know how the cash “would turn”

between these two statements,

and the road to wealth would be to try

to increase the monthly cash flow

from the asset column to the point

where it exceeds the monthly expense count.

Once you’ve achieved this,

you’ll be able to break out of the Rat Race

(the vicious cycle of making money,

paying bills, and getting in debt)

to the Fast Track (financial freedom of the poor) literally rich).

With this game, some people like it,

some people don’t like it,

and some people ignore it.

Right in the first round,

the woman mentioned above drew a card

with a yacht on it.

At first she was very happy:

“Ah, I have a yacht”,

Then when the friend explained the numbers working on the income statement,

the balance sheet and the cash flow her month,

she was startled to find that the yacht was swallowing her alive.

To her, it was a terrible game.

In 1984, I started teaching through games.

I always encourage adult students to notice

that the game reflects

what they know and what they need to learn.

The most important thing is

that the game reflects the way each person behaves.

It is an instant feedback system.

Instead of teachers giving speeches,

the game offers individual lectures and is written just for you.

Just like a game, the world always gives us instant feedback.

We can learn a lot if we know how to self-regulate.

Not long ago,

I complained to my wife that the laundry detergent

It must have caused my pants to retract.

My wife laughs and presses her belly with her hand

to show me that it’s not the pants that are retracted,

it’s the I am fat.

The “Cash Wheel” game is designed to give feedback to each player.

Its purpose is to present you with options.

If you draw a yacht and it leaves you in debt,

the question would be

“Now what can you do?”.

How many different options will you have now?

That is the purpose of the game:

to teach the player how to think and find different financial options.

I have observed more than thousands

of people playing this game.

The people who get out of the Rat Race the fastest are the ones

who understand the numbers

and have a creative financial mind.

They are aware of many different options.

The people who take the longest are those unfamiliar with numbers

and often don’t understand the power of investing.

Often the rich are the most creative and risk-taking.

There are people who play

“Cash wheel,

make a lot of money in the game,

but they don’t know what to do with it.

Most of these people are not financially successful in real life.

It seems like other people are surpassing them

even though they have their arrows in their hands.

And that is also a fact of life.

Many people have a lot of money

but no financial progress at all.

Limiting your options is like clinging to old ideas.

A friend of mine from high school is currently working three jobs at a time.

Twenty years ago, he was the richest man among his classmates.

When the local road plantation was closed,

his company also collapsed.

In his mind, he had only one option: to work harder.

The problem is that he can’t find a comparable job

and seniority at the old company.

As a result, he has more than enough capacity

for his current job

but still has to accept a lower salary.

Now he has to do three things at once to make ends meet.

I have seen many people play the “Cash Wheel” game,

complaining that the right chance cards never come to them.

So they just sat there.

I know people like that in real life.

They sit and wait for the “right” opportunity.

I’ve seen a lot of people get the right chance card but no money.

They then complained that they would have escaped the Rat Race

if they had had enough money.

And they sat there, too.

I know there are people like that in life too.

They see opportunities but they don’t have the money.

And I see a lot of people draw a big chance card,

read it out loud,

but never know it’s a big opportunity.

They have the money,

the time is ripe,

they have the cards in their hands,

but they don’t see the opportunity smiling on them.

They don’t know how their financial plan can get them out

of the Rat Race.

And I know there are more people like

that in life than all the others combined.

Most people have a flash of opportunity right

in front of their eyes but don’t see it.

It took them a whole year to realize it,

by which time everyone else was already rich.

If you have financial intelligence,

you will have more options.

If you don’t have a chance at all,

what can you do to improve your financial situation?

If you have an opportunity

but don’t have money and can’t get a bank loan,

what can you do to take advantage of that opportunity?

If your hunches were wrong and all the calculations failed,

what would you do to turn a penny into a million dollars?

That is financial intelligence.

Financial intelligence is how many different financial solutions

you can think of to solve a problem.

Financial intelligence is about how creative

you are in solving financial problems.

Most people know only one solution:

work hard,

save and borrow.

So why try to increase your financial intelligence?

Because only then can you create your own luck,

know how to embrace everything that happens and make it better.

Very few people realize that luck is man-made.

And so is money.

If you want to be lucky and earn more without working too hard,

then financial intelligence is very important.

If you are the type of person who waits for time,

you will have to wait a long time,

just like waiting until the green light turns on for 5 miles

to start the trip.

When Mike and I were kids,

rich dad used to tell us,

“Money isn’t real.

Poor and middle-class people work for money,

and rich people make money.

The more you think money is real,

the better you have to work harder for them.

If you understand that money is not real,

you will get rich faster.”

“So what would the money be if they weren’t real?

” Mike and I asked the same question.

“What you think they are, they will be.

” Rich dad replied.

The most powerful asset we all have is our brains.

If trained well, it can create huge wealth in an instant.

In the information age,

money increase exponentially.

Some people can get incredibly rich from nothing,

with only ideas and deals.

If you ask people who live by trading stocks

or other investments,

you will see that clearly.

Often these people earn millions

of dong in an instant for nothing.

When I say “for nothing”,

I mean that there is no exchange of money.

It is done through agreements:

a hand signal at the place of business,

a flash of light on the screen of a trader in Lisbon

to the screen of a person in Toronto,

a phone call to the broker to buy and sell them right after.

Money does not change owners, only agreements change.

In summary, financial intelligence is created

through the following four technical skills:

1. Financial understanding.

Ability to read and understand numbers

2. Investment strategies.

The science of money makes money.

3. Market, supply and demand. 

4. Law, knowledge of accounting, federal, governmental,

and national laws and regulations.

I advise you to always play by the rules.

It is the combination of these four skills

that is necessary to succeed in the pursuit of wealth,

whether by buying and selling small houses,

large apartments,

companies,

stocks,

checks,

mutual funds,

precious metals,

baseball shows or whatever.

Here I mean that capital will come and go,

the market will go up and down,

the economy will go up and down.

Every day of your life,

the world always presents you with opportunities in life,

but often we don’t see them.

But they are still there.

And the more the world changes,

the more technology changes,

the more opportunities there will be to allow you

and your family to financially secure future generations.

So why think about developing your financial intelligence?

Again: only you can answer that question.

I know why I have to keep learning and growing,

because the world is changing.

I would rather welcome these changes than cling to the past.

I know there will be market booms and market crashes.

I want to continue to develop my financial intelligence

because once the market changes

there will be some people who have to bow to their jobs.

Meanwhile, other people will take the bitter fruit the world gives them,

we all eat that bitter fruit from time to time

– and turn them into millions of dollars.

That is financial intelligence.

Personally, I use two vehicles to achieve financial growth:

real estate and small stocks.

I use real estate as a foundation.

With each passing day,

my assets provide cash flow and sometimes

they rapidly increase in value.

Small stocks are used to grow fast.

I don’t encourage you to do everything like I did.

Examples are just examples.

If the opportunities are too complicated

and I don’t know the investment,

I won’t take them.

Simple math problems

and a keen sense are all it takes to grow financially.

In 1989,

I used to jog through a fairly rewarding suburb

in Portland, Oregon.

There were houses so small and pretty

that I almost thought

I’d meet Little Red Riding Hood dancing to my grandmother’s house.

On the run, I saw signs of houses for sale, everywhere.

At that time the wood market was terrible,

the stock market had just crashed

and the economy was stagnating.

On a street, I saw a “house for sale” sign

that seemed to have been hanging for a long time,

it was very old.

As I passed,

I stopped in to see the owner of the house,

he looked full of concern.

I asked,

“How much did you sell the house for?”

The owner smiled weakly:

“You go ahead and bid,

I’ve been putting up a sign to sell the house for a year.

No one even looks at it anymore.”

I said, “Let me see.”

and half an hour later,

I bought the house for $20,000 less than he originally offered.

It was a lovely little house with two bedrooms

and colorful decorations on the windows.

It’s painted light blue with gray outlines,

built in 1930.

Inside is a well-maintained stone fireplace

and two tiny bedrooms.

It would be a perfect rental home.

I paid the owner $5,000 cash upfront for the $45,000 house,

which was actually worth $65,000.

The owner happily moved away, as if getting out of debt.

And the first tenant moved in, a local college professor.

After paying off all my debts

and administrative expenses

I pocketed about $40 per month at the end of the month.

It’s also quite interesting.

A year later, Oregon’s stagnant real estate market

began to recover.

California investors with money

from their still-growing real estate market moved northward

to the Oregon and Washington regions.

I’m selling this little house to a young couple in California for 95.000 $.

My capital has brought in nearly $40,000 in interest thanks

to late tax payment 1031,

and I continue to look for places

to invest this money…

The main point in this example is how a small amount can grow

into a large amount.

Again, it’s a matter of understanding financial statements,

investment strategies,

and the laws and markets.

If people are not well versed in these subjects

then it is obvious that they will follow standard teachings,

instructing people how to be safe…

The hottest deals don’t usually come to the novices.

Often the best deals that make the rich richer are reserved

for those who know the game.

The more “savvy” I become,

the more opportunities

I will have in my life,

and the higher your financial intelligence,

the easier it will be to tell you

if such a deal is good or bad.

No. It’s your own understanding

that will spot bad deals or make a bad deal better.

The more I learn, and there’s so much to learn,

the more I will do.

I make a lot of money, simply

because as the years go by I will accumulate a lot of experience and wisdom.

I have friends who always want to be safe,

work very hard professionally,

but  failed to find financial wisdom,

which took time to develop.

Overall, my philosophy of life is to plant seeds in your wealth column.

I started planting with small seeds.

Some seeds grow and some don’t,

but I don’t give up because of that.

In the real estate alliance,

we have several million dollars worth of properties.

That is our REIT,

also known as real estate investment trust.

What I want to make clear here is that most

of these few million dollars start from small investments of $5,000 to $10,000.

All of this money is advantageous in catching up

with a rapidly growing market,

increasing the number of tax-free numbers,

trading and bartering several times over the years.

We also own a stock portfolio,

surrounded by an alliance that my husband

and I call a personal mutual fund.

We have friends who trade with investors like us

and have some extra money each month to invest further.

We buy private companies

that have just been equitized in the US or Canadian stock markets

for speculation,

taking high risks.

We used to buy 100,000 shares at 25 cents each before going public.

Six months later,

the company was listed and these 100,000 shares were worth $2 each.

If the company is well managed,

the price will continue to rise and each share can go up to $20 or more.

There were times when our $25,000 went up

to $1 million in less than a year.

It’s not a game of chance if you know what you’re doing,

not just toss money into a trade and sit at home praying.

It is necessary to use expertise, wisdom

and passion in this game to limit risks.

Of course there are many risks that cannot be avoided,

but it is financial intelligence

that will help you improve the situation.

That’s the first reason

I constantly encourage people

to invest more in financial education

than in stocks, real estate,

or other markets.

The smarter you are,

the more chances you will have of defeating your opponent.

The stock games that

I personally invest in are often too risky for many people

and I strongly discourage you from doing so.

I’ve been playing this game since 1979

and often get paid more than I’m supposed to get.

But maybe you’ll start your life in a different way,

so that you can turn $25,000 into $1 million in a year with minimal risk.

The things I’ve done are just drops in the ocean,

but for the average individual,

a non-interest income of more than $100,000 a year is quite good and not too difficult to achieve.

Depending on the market and your sensitivity,

you can do it in about 5 to 10 years.

If you keep your standard of living affordable,

$100,000 in additional income is very comfortable,

regardless of whether you work or not.

You can work if you like or rest if you want,

but it is better to use the government’s tax system

to your advantage rather than against you.

My background is income generating properties.

I like properties because they are stable and change very slowly.

I try to keep it sustainable.

Cash flow is quite stable and if managed well,

we have a chance to increase its value.

The beauty of a solid real estate platform is that it sometimes allows us

to take a little more risk with speculative securities.

If I make a lot of profit from the stock market,

I will pay taxes on the profit from the sale of the property,

Then invest the rest in real estate

so that you can once again solidify your asset base.

One last word on real estate.

I’ve traveled all over the world and in every city

I’ve heard people say you can’t buy cheap real estate.

That is not my experience.

Even in New York, Tokyo or Bangkok,

there are good opportunities that go unnoticed.

So when I hear people say:

You can’t do it here,

I remind them that it’s actually “I don’t know how to do it here…” ,

You can only see good opportunities with your head

and with trained financial sensitivity.

Most people don’t get rich simply

because they don’t have the financial training

to recognize the opportunities right in front of them.

In the final chapter,

I lay out 10 steps I took on my path to financial freedom.

But remember to find joy in it.

This is just a game.

Sometimes you win and sometimes you have to learn.

But have fun with it.

Most people never win because they are afraid to fail.

In school, we learn that making a mistake is a bad thing,

and that if we make a mistake we are punished.

However, if you look back at the human learning process,

you will see that we learn by making mistakes.

We learn to walk by falling.

If we never fall, we will never walk.

The same goes for cycling.

I got a few scars on my knees while riding,

but today I can ride a bike without thinking.

And the same goes for getting rich.

But unfortunately,

the main reason most people don’t get rich is

because they fear loss.

Winners are not afraid of failure.

But it is the losers who fear it.

Failure is mother’s success.

Those who avoid failure will also not meet success.

I treat money like tennis.

I play, make mistakes and fix them,

make more mistakes,

fix more and get better and better.

If I lose,

I’ll walk across the net,

shake my opponent’s hand,

smile and say,

“I’ll see you on Saturday…”.

From my experience, I divide investing into two types:

1. The first and most common form is the purchase of a package investment.

An investor calls a reseller, such as a real estate agent,

stock broker or financial planner to buy something.

It could be a mutual fund,

a REIT,

a stock or a check.

It’s a simple and fast way to invest.

It’s as simple as a shopper going to a computer store

and buying a computer that’s right there on the shelf.

2. The second type is investment generation.

These types of investors often collect deals,

just like people buy individual computer components and assemble them.

It’s a make-to-order form.

I don’t know anything about building computers,

but I do know how to put the pieces of opportunity together,

or I know someone who can do it.

An investor of the second type can be called a professional investor.

Sometimes it takes years to put the pieces back together,

and sometimes they just can’t be put together.

Rich dad always encouraged me to become a second type investor.

Then it’s important to learn how to put these pieces back together

because it’s a huge win,

and sometimes,

if you go against the current, it’s also a huge failure.

If you want to become a professional investor,

you need to develop three key skills.

These skills add to the four required to be financially intelligent.

1. How to find an opportunity that others miss?

With your mind,

you can see things that others cannot see with the naked eye.

For example, a friend bought a dilapidated old house that looked like a haunted house.

People wonder why he bought it.

What he can see and others can’t see is

because the house comes with 4 additional plots of land.

After buying the house,

he demolished it and sold 5 lots to a builder

for three times the price he bought the package.

He earned $75,000 in just 2 months of work.

This amount is not much but certainly far exceeds a meager salary,

and this is not technically difficult at all.

**********************

2. How can I increase my money?

Ordinary people know only one way is to go to the bank,

and professional investors know many ways

to raise capital without going to the bank.

For starters,

I learned how to buy a house without a bank.

The houses didn’t cost too much,

but the money-raising skill I learned was priceless.

Very often I hear people say,

“The bank won’t lend me money,

or “I can’t afford it.”,

If you want to be a professional investor,

you need to learn how to do what most people do,

who can’t do it.

In other words,

mostly because of lack of money,

they can’t do business, if this obstacle can be avoided,

You will get millions of dollars.

Many times I bought an apartment,

a block of shares or an entire building

without even needing a dime in the bank.

I once bought a building for $1.2 million.

I do it in what is known as a “keep the money”,

with a handwritten contract between the buyer and the seller.

I called a deposit of $100,000,

it allowed me 90 days to pay the rest of the amount.

Why do I do that?

Simply because

I know that the house is worth up to 2 million dollars.

I don’t pay money.

Instead, the guy who asked for a $100,000 deposit would give me

$50,000 for finding the deal(commission),

he took my place and I left.

Total working time: 3 days.

Again, the main thing is what you want,

not what you buy.

Investing is not buying and selling.

That is understanding!

Its mean that you are a good land broker.

3. How to co-operation wise people?

A wise person is someone who hires

or works with people who are wiser than he is.

When you need advice,

be sure:

you have chosen your advisor wisely.

There is so much to learn,

but the rewards are immense.

If you don’t want to learn these skills,

be a first-class investor.

The very things you know are great assets.

It’s the things you don’t know that are the biggest risk.

There are always risks,

so learn to manage these risks instead of avoiding them.

Millionaire or billionaires only focus on doubling their wealth every day. ― Steve Siebold