This article is an excerpt from the Shortform summary of "Rich Dad Poor Dad" by Robert T. Kiyosaki. Shortform has the world's best summaries of books you should be reading.
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What are some great Rich Dad, Poor Dad quotes? Can these quotes help you understand the lessons in the book?
There are several well-known Rich Dad, Poor Dad quotes that go over the book’s major concepts and principles. You can check out these Rich Dad, Poor Dad quotes for some of the top ideas and explanations in the book.
Rich Dad, Poor Dad Quotes
These Rich Dad, Poor Dad quotes cover various parts of the book. Below you’ll find the quote and an overview of where the quote came from so you can better understand the concepts in the book.
“Know a little about a lot.”
The first of the Rich Dad, Poor Dad quotes helps explain that many people with great talent in their trade aren’t rich. They’re specialists and proud of it.
Often, they just need to learn and master one more skill to dramatically boost their income.
- Analogy: How many people can make a better hamburger than McDonald’s? Most people would think so. Then why does McDonald’s make more money than they do? Because McDonald’s has mastered a business system, while most people focus on building a better hamburger.
Notable examples of underappreciated skills include sales, marketing, communication, negotiating, investing, people management, and financial intelligence.
- Consider taking a pay cut to work at a firm where you’ll gain a critical orthogonal skill – like marketing at an ad agency, or people leadership in the military.
- Rich Dad invited his son and the author to work in a broad set of roles at his companies (bus boy, construction worker, accounting) and participate in meetings with bankers, lawyers, and accountants.
“Most people go along with the crowd. They do things because everybody else does it.”
Don’t be afraid of rejection. Fear of ostracism prevents people from having nonconsensus opinions. As it relates to finance, it’s in 1) not bucking the consensus traditional way of handling your career and money, 2) keeping up with the Joneses and matching spending. Focus on yourself and your personal goals, regardless of what other people think. This is one of the Rich Dad, Poor Dad quotes that focuses on fear.
If you fear all of these things, you can still be rich. But it requires a wiser, more conservative path: start young, save money, and use compound wealth to become rich when you’re old.
“The fear of being different prevents most people from seeking new ways to solve their problems.”
This is one of Rich Dad, Poor Dad’s best quotes. Don’t be afraid of turbulence or risk. “I’d like to, but I’m due for promotion in three months” is the classic excuse. There is always another carrot dangled ahead of you, and so there’s always a good reason not to do what you really want to do.
“An important
distinction is that rich people buy luxuries last, while the poor and middle
class tend to buy luxuries first.”
Don’t buy physical goods whenever you get more money, with the expectation they’ll be good investments. This includes bigger houses, fancier cars, house renovations, handbags, jewelry, and golf clubs.
Not only do consumption goods not generate income, they also depreciate incredibly quickly.
- Common advice: A new car loses 25% of the price once you drive it off the lot.
- Corollary: buy used goods instead of obsessing about it being new.
Be especially careful when buying the thing just causes you to go further into debt. This is a major way to increase expenses without increasing income, thus digging you into a deeper hole.
- People have a tendency to spend money when they get it. But it’s not about how much money you make, it’s how much money you keep.
- More money only accentuates the cashflow pattern running in people’s heads. This is why giving people more money without financial education rarely improves their situation.
Kiyosaki isn’t saying don’t enjoy yourself. You can still buy nice things and live life well. But ideally, afford your luxuries using extra cash flow from your assets. This way you’ll feel like you’ve really earned it. Rich people buy luxuries last. While this isn’t the most exciting of Rich Dad, Poor Dad’s best quotes, it helps explain a key idea in the book.
“Once government got a taste of money, the appetite grew.”
In this Rich Dad, Poor Dad quote, Robert Kiyosaki is clearly strongly against taxation, saying things like:
- Most people work from January to May just for the government.
- The Social Security tax is an insidiously large tax, at 15% of wages.
- Originally in England/early US, taxes were only levied against the rich. They were then extended to middle and lower classes to support a growing government appetite for money, and eventually taxation disproportionately punishes the poor.
- The biggest bully isn’t your employer or your manager, but the tax man. “The tax man will always take more if you let him.”
Whatever your philosophical bent on taxation, the practical point is that the rich find ways to minimize their tax burden, sometimes paying a lower % of their income than lower tax brackets.
“When it comes to money, the only skill most people know is to work hard.”
The rich don’t get rich merely by being paid higher salaries (though this is a great help). They get rich by owning things that make them more money. This is one of Rich Dad, Poor Dad‘s best quotes since it examines the difference between the Poor Dad’s philosophy and the Rich Dad’s philosophy.
Wealthy people use their Income to buy Assets that return more Income. Meanwhile, they minimize their spending on Expenses and buying Liabilities, to have more money to buy more Assets.
Explanation of Rich Dad, Poor Dad Quotes
People who don’t become rich either spend all their income on expenses, or buy liabilities that increase their expenses but don’t add income.
The key to financial independence is having money that makes more money. You want your money to make enough money that you don’t have to work anymore.
These Rich Dad, Poor Dad quotes can help break down some of the concepts, or become words to live by if you’re serious about the theories presented. They’re not the only great Rich Dad, Poor Dad quotes, and you’ll surely find other quotes you love in the book.
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Here's what you'll find in our full Rich Dad Poor Dad summary :
- The key differences in how rich dad and poor dad approached life
- Why it's a terrible idea to buy an expensive house
- How to overcome your own mental blocks to become wealthy for life
