. He points out that McDonald’s may not make the best hamburgers in the world, but owns the “most valuable intersections and streets in America.”
The advantage of a corporation versus that of the individual lies in how corporations pay taxes, according to the author. He makes this point clearly: individuals earn money, pay taxes on that money, and live with what’s left. The corporation, on the other hand, earns money, spends everything it can, and is taxed on anything that’s left
Rich dad poor dad
CHARACTERS• Poor dad – educated but lacking the street smarts• Rich dad – very little education (eighth grade), tons of street smarts• Kiyosaki – the spectator who learns lessons from both but internalizes only rich dad’s traits
THE BIG IDEA• A job is a short solution to a long term problem.• A highly paid slave is still a slave.• Why climb the corporate ladder when you can own the ladder?• You are what you think.
RICH DON’T WORK FOR MONEY• Work to learn• Some people quit the job because it doesn’t pay well.• Others see as an opportunity to learn something new.
WHY TEACH FINANCIAL LITERACY??• Understand the difference between asset and liability.• Concentrate you efforts on buying income earning asset.• Focus on keeping expenses and liability at minimum.
MIND YOUR OWN BUSINESS• Keep your day job but keep minding your own business.• Don’t spend all your wages.• Build a portfolio of assets.• Spend later when these asset bring you greater income.
THE HISTORY OF TAXES AND POWER OFCORPORATIONS• Use the corporation to shelter yourself from heavy taxation.• Do your own research and find out what tax laws will bring you best advantages.• Pay yourself first.
THE RICH INVENT MONEY• Make good use of your time and find the best deals.• Identify an opportunity everyone else has missed.• Two type of investors:1. Buyers of packaged investment.2. Professional investor
WORK TO LEARN – DON’T WORK FOR MONEY• Learn skills like PR, marketing and advertising.• Take a second job if it means learning more.• Three main management skills:1. Management of cash flow2. Management of people3. Management of systems
FIVE OBSTACLES TO FINANCIAL INDEPENDENCE:• Fear• Cynicism• Laziness• Bad habit• Arrogance
TEN STEPS TO AWAKEN YOUR FINANCIAL GENIUS:• Find a big dream• Power of choice• Chose your friends carefully• Master a formula. Learn a new one, learn faster.• Pay yourself first• Pay your broker well
TEN STEPS TO AWAKEN YOUR FINANCIALGENIUS (CONT…)• Buy luxuries last• Find yourself a role model• Teach and you shall receive