Wisdom of Rich Dad

The money is out there. No matter how many people tell you that we are in the midst of a starvation economy, that the market is doing this or that, and that it’s too risky to “play the game,” so to speak, people are getting rich every day. That is the reality.

The trick, of course, is to become one of those people.

”Yeah,” you might say. “That guy was just lucky. What are the chances of that happening to me?” Well, absolutely zero if you don’t do anything about your dreams to build wealth. If you walk around thinking that you have only a snowball’s chance of hitting “the big one” in the financial game, then you are right. That’s because you are depending on chance.

Becoming wealthy is not about chance. Oh the guy you just read about may indeed have been lucky-but he was not “just lucky.” Because fortune favors the prepared mind, you have to lay the groundwork in order to take advantage of opportunity when it arises. You have to be able to not only recognize those opportunities, but to actually have the resources to take advantage of them.

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People are very entertaining if you just take time to listen to what they say and observe how they act. After all, that’s why reality television shows are so popular. Now you can watch people from the comfort of your living room chair.

The things they do and say are so highly entertaining because people so often react based on emotion. Often, that emotion is fear. Throw in a little laziness and a willingness to believe whatever they hear that justifies their fear and there you have them-the two most wealth-preventing myths about real estate investing that were ever conceived. And those two are the parents of the third.

Those myths are, of course, fear-based. They are also myths that would not exist if it were human nature to educate themselves about a thing before making up their minds about it.

What are those myths?

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For as long as there have been entrepreneurs, they have always used certain business principles to build multi-million companies. Then, about 12 years ago, these business principles were popularized and became known as the “Cash Flow Quadrant” by the best selling financial education author, Robert Kiyosoki in his book “Rich Dad Poor Dad”. Together with Donald Trump, they said “The only way to amass true wealth is having your own business and/or investing wisely.”

World wide, the true wealthy have mastered wealth in two ways. They own a business and are also investing their way to wealth so they don’t always have to work for their money. Obviously, the goal here is to have their money work for them so they don’t have to work as hard at the business. It is not a new paradigm, rather it’s been used by entrepreneurs forever but the great majority of the population have never caught that vision nor have most colleges and universities.

Historically, and it remains true to this day, we’ve all been taught to work for our paycheck by being employed by someone else or a big corporation or having a profession. Also, we’ve been taught to take advantage of our employer’s retirement plan and other fringe benefits and when we are old and gray, our retirement funds and medical plans will take care of us. Read the rest of this entry »

How can average-earning workers make their money work for them? This is the one question that employees should start asking themselves given the unstable economy.

Nowadays, most employees, in one way or another, are not contented with their jobs and the corresponding salaries. The possibility of getting reduced retirement packages has also worsened the situation. In most cases, there are no more golden parachutes waiting for retirees. With this, the unfolding economic reality should trigger a new mode of thinking among workers, lest they will be left hanging when retirement comes knocking.

According to Robert Kiyosaki, author of the popular “Rich Dad, Poor Dad” series, people have two options if they want their hard-earned money to work for them. The first option is to leave the security of employment and start their own business. The second option is to start pouring their money into different types of income-generating assets such as mutual funds, bonds, and stocks.

Among the most popular forms of assets held by investors are stocks. As an income-generating asset, stocks can give decent returns for its owners in the form of dividends — representing the stockholder’s share of company profit or through the upward price movement of the stock.

Of course, the owner needs to sell the stock first before one records actual profit. On the opposite end, however, its capacity to provide higher returns also means that it can lead to heavy losses for owners, a lesson that all stockholders were painfully made aware of at the height of the crisis.

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When people hear the state “Penny stocks” this refers to stocks of organizations that are priced at very disconsolate prices. There is large growth possibilities, and your initial fling can buy for quite small, but you stand the risk of the shooting match becoming insolvent and you dropping your money invested. The pull to these kinds of shares due to the fact that despite the risks you can see vast returns.

Obviously, when you’re attempting to pick out a penny stock to invest prominence you are activity to require to inquire about a few things about the organization. Similar to buying stocks of fraction other kind of publicly traded business, it’s necessary to understand everything about the business. That plug in understanding what the organization do, the aim they make, what products are offered, how their business vivacity functions and who augmented is involved in their industry.

It’s unlikely that the organizations that mention these types of shares think complex organizations – regularly they are basic to understand and hinge care. You entrust find many of these types of shares that are organizations involved shroud resource endeavor – their value will crack up and disconsolate based on the cost of the instrument produced.

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I don’t know one person in my sphere of influence that couldn’t use a little extra monetary help. Everyone I know would like to have more money and not have to work so hard everyday to get it. Yet so few people get any income from sources other than their jobs. It doesn’t have to be this way but they do not realize it.

It is important for me to say that I do not think everyone has to have the same goals as me. Not everyone wants to be an entrepreneur or full time investor. Not everyone wants to or is willing to devote their lives to getting out of the rat race. Some people just want a little more than they’ve got now. There is help out there for all types.

So what can these people do? They say they’ve got no extra money to spend, no time to read or the don’t like reading, they just aren’t smart enough to get the principles of money or it’s all too complicated.

Books

Let’s start with the simple – books. Money should not be an issue when it comes to books. There are cheap books from used book stores and online and then there’s the free library. Reading them should not be an issue either. I know that some books are boring and painful to get through. But if a book is enjoyable and easy to read then it should take no effort. If you really don’t like reading then try an audio book and listen to it in your car on the way to work. I would recommend “Rich Dad, Poor Dad” and “The Cashflow Quadrant” books by Robert Kiyosaki as a good place to start. They are easy to read and enjoyable books. But there are others. It doesn’t matter, just read something and start changing your perspective on your own money situation.

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