Wisdom of Rich Dad

MANHATTAN (CN) – A federal class action claims Rich Dad Education and its affiliates use their “free classes” and $199 seminars about financial success as a come-on in a high-pressure “sales scam” to sell worthless courses for tens of thousands of dollars.
Named plaintiff Robert Crewe says Rich Dad’s “sales scam is built on a misleading three-tiered sales pitch where customers are sold increasingly expensive financial training programs using pressures tactics and false promises.”

Crewe says he paid $199 to attend a “Rich Dad Education Stock Success 3-day Training program, which was supposed to provide training and education in trading stocks.”

But he says, “Defendants did not provide any training or education at the workshop. Instead, the sole purpose of the workshop was to up-sell ‘students’ into additional useless but more-expensive coursework and monitoring, which costs up to $64,899 per enrollee.”

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An Accokeek man is up against Warren Buffet. So far, he’s ahead.

Jeff Yeager, who writes about frugality, is one of 12 personal finance experts featured in a contest on www.gobankingrates.com, a financial website.

Until Dec. 31, visitors to the site can vote once per day for their favorite from a list that, in addition to Yeager and Buffet, includes Suze Orman, who has a personal finance TV show, Dave Ramsey, a radio personality, and Robert Kiyosaki, creator of the “Rich Dad, Poor Dad” books and seminars.

In a Wednesday interview, Yeager, who has dubbed himself “the Ultimate Cheapskate,” said he was startled to be selected to compete against the “rock stars of finance.”

“At first I thought it was some sort of scam,” he said.

Yeager has written two books about serious frugality he advocates paying less than a dollar per pound for groceries, and conducted a cross-country book tour by bicycle but didn’t think he had achieved enough attention to be in the top 12, he said.

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It is typical to grow up believing that if we studied hard, excelled in school and landed a good job, the fairytale of having a luxury car, a dream home and being able to live the good life would come true.

But the reality is, there are many people, including highly educated ones, who work hard for money and yet plunge deep into debt with every dollar earned.

Some take the short cut by placing bets on the lottery. While millionaires have been made overnight, they can become bankrupt just as quickly if they lose all of their winnings to extravagant lifestyles and frivolous spending.

Even today, the downward spiral of the real estate markets has completely shattered the dreams of ordinary people hoping to create wealth. It is worse for those who have been driven out of their dream homes and into the “poor house” as a result of property foreclosure.

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Robert Kiyosaki is an American investor, businessman, self-help author and motivational speaker, who has written 15 books, with combined sales of over 26 million copies.

Three of Robert’s books, Rich Dad Poor Dad, Rich Dad’s CASHFLOW Quadrant, and Rich Dad’s Guide to Investing, have simultaneously been on the top 10 best-seller lists of The Wall Street Journal, USA Today and the New York Times.

In this Q&A interview with Alex Pirouz, Robert Kiyosaki discusses what it takes to be successful in business, the No 1 skill every entrepreneur should learn and the five qualities required by every entrepreneur in order to become successful.

What does it take to be a successful entrepreneur?

It takes ambition and the desire to truly master the art and science of becoming a successful entrepreneur. And in my opinion ambition is far more important than brains, because if you have ambition you can always hire good brains.

What is your number one rule of thumb in business?

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The last couple weeks have been a zoo in Washington, showcasing much of what is wrong with our country, our politics, and our economy. It’s said that as Rome declined, the emperors said, “Give them bread and circuses.” Feed the populace and entertained them, and they’ll never revolt—until you run out of bread. People can live without entertainment, but they need bread.

Sadly, our government is the circus, and many people are starting to get hungry.

Yesterday, the house has passed a compromise bill to raise the debt ceiling that has no details and opens the way for a potential historic lobbying effort as the rich and powerful get ready to fight for the scraps of government funding.

But I don’t need to point out how dysfunctional our government is to you. The whole world knows by now.

Instead, I’m going to focus on another dysfunction—the college education system.

Huffington Post, reports that in an effort to pay for college, many young women are exchanging sex for tuition with dirty, old, rich men.

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Except for a handful of hedge funds and perhaps some gold coin dealers, few investors are able or willing to stand up during a recession and proclaim that they’re on a hot streak.

Borrowing the open from Charles Dickens’ A Tale of Two Cities, Kiyosaki uses the phrase, “it was the best of times, it was the worst of times,” to illustrate his belief that opportunity always exists, even when the typical barometers of growth and economic vitality suggest otherwise. (For the record, the line that follows is also telling: “It was the age of wisdom, it was the age of foolishness.”)

“I hate to say it but it has been the best three years of my life,” says best-selling author and financial literacy advocate Robert Kiyosaki. “I have never made so much money – America is on sale.”

This self-proclaimed “cash-flow guy” prefers investments that “throw money in my pocket every month.” He’s focused on real estate, oil, gold, silver, and natural gas. Given his belief that “commercial real estate is done and individual real estate is a mess,” Kiyosaki says 300-800 unit apartment complexes are “the hottest part of the market.”

When asked if dividend paying blue chip stocks meet his criteria for value and cash flow, the native Hawaiian says no, and refers to a cyclical prediction from a previous book that has called for a bottom in 2016. In the meantime, he has no interest in owning shares of Exxon Mobil (XOM) or BP (BP). Instead he prefers “buy private oil drilling projects, where the entrepreneur and I are good friends.”

Clearly, a man of his means, who has access to and writes books with Donald Trump, will have a different array of investment choices and opportunities available to him than the average Joe. For us mortals, his advice is 3-fold: Educate yourself, be smarter, and seek cash flow.

Kiyosaki has been a gold bug since his time in Vietnam 40 years ago. “If I have cash and I can’t figure a way to put it into real estate or my business, I hold it in gold and silver,” he says.

For those holding out hope that Ben Bernanke and the Fed will inject more dollars into the monetary system and markets, Kiyosaki says you’ve got it all wrong. “The Fed just printed like $4trillion dolllars in three years,” he says. “That wipes out the purchasing power of your money and your labor. So I think the Fed and the Treasury have basically ripped off the American worker.”

If he’s right, perhaps it’s time for a policy re-branding and would suggest, “Quantitative Teasing.”