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The Book in One Paragraph
The only secret to becoming rich is to acquire assets and avoid liabilities. Assets are anything that puts money in your pockets. Liabilities are anything that takes money out of your pockets.
Rich Dad Poor Dad Summary
This is my book summary of Rich Dad Poor Dad by Robert Kiyosaki. My notes include quotes, big ideas, and important lessons from the book.
- There are only a few basic principles of personal finance that you need to understand to become rich.
- Principle 1: The rich don’t trade time for money. They acquire assets that make money for them.
- Principle 2: The rich acquire assets (stocks, bonds, real estate, websites, businesses, etc.) while the poor and middle class acquire liabilities that they think are assets (houses, cars, most material possessions, etc.).
- Principle 3: The rich focus on their assets while everyone else focuses on their income statement.
- Principle 4: The rich always focus on increasing their financial IQ. They understand how markets work, the role that human psychology plays in money management, and how compound interest works.
- Principle 5: The rich seize opportunities to invent money. This includes creating businesses, websites, products, and finding ways to provide services, seek out side hustles, and attract income.
- Principle 6: The rich work to learn and not for job security. Often the richest people are the most voracious learners outside of their day job.
- Principle 7: The rich avoid the most common obstacles that prevent wealth: laziness, cynicism, fear, bad habits, and hanging out with complainers.