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Dan's Reviews > Rich Dad, Poor Dad
Rich Dad, Poor Dad
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This book may do a good job of getting you excited about your financial future but the false information it teaches negates any benefits.
I believe this book does a disservice to the public. I suspect it was written to appeal to those who are failing in the world's conventional definition of success. Didn't go to college? Can't hold down a stable job? Good for you! You haven't fallen for that waste of time and stupid rat race like all those other suckers!
Saying that higher education isn't worthwhile is misleading. I agree it isn't essential (and possibly not even helpful in rare circumstances), but the high correlation in the general public between education and wealth cannot be ignored.
He also gives poor advice in finances and investing. For example, not adhering to diversification. Or getting out of a stable job (a.k.a. "rat race") where "even if you win you're still a rat."
The author praises learning correct accounting but then proceeds to butcher even the most fundamentals. For example, his first rule is "You must know the difference between an asset and a liability" but then he proceeds to claim that your home is a liability, not an asset. Completely backwards. Any accountant will tell you so.
The book is full of exaggerated and sometimes completely false anecdotes -- for example, it appears the entire premise of the book is false -- there never was a rich dad and Robert wasn't wealthy until he embraced MLM and started selling get-rich books.
If you just want some motivation, please try another book such as "The Millionaire Next Door." If you want sound personal financial advice, please read "The Only Investment Guide You'll Ever Need."
See for an in-depth critique of Kiyosaki and charts showing the correlation between education and wealth.
I believe this book does a disservice to the public. I suspect it was written to appeal to those who are failing in the world's conventional definition of success. Didn't go to college? Can't hold down a stable job? Good for you! You haven't fallen for that waste of time and stupid rat race like all those other suckers!
Saying that higher education isn't worthwhile is misleading. I agree it isn't essential (and possibly not even helpful in rare circumstances), but the high correlation in the general public between education and wealth cannot be ignored.
He also gives poor advice in finances and investing. For example, not adhering to diversification. Or getting out of a stable job (a.k.a. "rat race") where "even if you win you're still a rat."
The author praises learning correct accounting but then proceeds to butcher even the most fundamentals. For example, his first rule is "You must know the difference between an asset and a liability" but then he proceeds to claim that your home is a liability, not an asset. Completely backwards. Any accountant will tell you so.
The book is full of exaggerated and sometimes completely false anecdotes -- for example, it appears the entire premise of the book is false -- there never was a rich dad and Robert wasn't wealthy until he embraced MLM and started selling get-rich books.
If you just want some motivation, please try another book such as "The Millionaire Next Door." If you want sound personal financial advice, please read "The Only Investment Guide You'll Ever Need."
See for an in-depth critique of Kiyosaki and charts showing the correlation between education and wealth.
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Rich Dad, Poor Dad.
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Reading Progress
Started Reading
January 1, 2001
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Finished Reading
February 11, 2008
– Shelved
Comments Showing 1-50 of 64 (64 new)
Yeah, Bridey, I was just going to write a few words and then got carried away! The book does get people motivated. And it does give some good advice. But I figure "What's the point?" when you can get motivation elsewhere or beneficial financial advice elsewhere and not have the baggage of poor advice mixed in and false stories that are presented as true.
Probably true. We are, after all, doing amway and living out of the back of our car right now, and we consider ourseslves wildly financially successful. j/k
By the way, I guess I should re-read for typos before I post.
I have read this book as well and it seems pretty sound. I think the part about home ownership you may have misunderstood. Your house is an asset, the liability is the mortgage payment you have to pay. Anything that takes money from your pocket is a liability, this includes loans. Also as far as education is concerned, I don't think he was saying that continued education is bad, it is really good. The problem is that there is no education about money in your early years. So you end up taking on by example (parents, friends) on how to deal with money.
Basically it is MPC. Marginal propensity to consume. As income rises so does expenditures. So this is the theory of the 'Rat Race'. You just keep chasing money. Go to school, get a 'secure job' and you'll be fine.
I think the idea is financial freedom. I don't know about you but I'm tired of working for someone else making them rich. I don't want to work until well basically till I'm dead because Social Security is a scam, and 401ks don't even keep up with inflation. I want to have some memories of my family instead of work.
I agree, I'm 18, in college, and don't know what to do with my life. I've always wanted to be rich, but I didn't know how. I don't view this book as a 'get rich quick,' deal. I think of it more as financial guidelines, ideas used to get you on the right track financially. What Kiyosaki says makes sense, there's no denying it. Sure, he's vague about where to invest, or how, but I believe the point of the book isn't to tell us the specifics, but to get us motivated to get our financial lives straightened out, or in my case, get mine started.
James:
I think the part about home ownership you may have misunderstood. Your house is an asset, the liability is the mortgage payment you have to pay.
Actually, I think you have misunderstood. You are right that a house is an asset and the mortgage is a liability (though the mortgage payment is technically an expense). My beef is that Kiyosaki says rich dad taught "My house is a liability" (pg 15) and that "If my wife and I were to buy a bigger, more flashy house we realize it would not be an asset, it would be a liability" (pg 73).
Also as far as education is concerned, I don't think he was saying that continued education is bad, it is really good.
Yeah, he never said it was bad, he just downplays its importance. Sure, a college education doesn't guarantee a good income, but the correlation is huge and it is silly to ignore it. Is it really a good idea to tell kids in school that grades and a college education aren't needed for a good career? I think Kiyosaki would say yes. I think it is true, but also misleading.
I think he is not giving people very much but fluff. You should read: Wealth Building Strategies of the Super Rich ISBN 0615301797.
Dan When did your "asset" (your house) make you money?
Agreed with Michael. A house that you have to take care of is a liability, not an asset. His principles are pretty clear about the differences between an asset and a liability: the house is not putting money in your pocket. Real estate, on the other hand, can.
Michael/Karen: Some assets make money, others don't. Think of your car, your furniture, your sports equipment, your clothes, the cash under you mattress. Those are all assets. A house *can* be used to make money when you rent it, sell it, or use it to run your home business. But you don't have to be using it to make money for it to be an asset.Income-producing investments are typically considered assets, but not all assets must be income producing, maintenance-free, or even a good idea. There are plenty of assets you could buy that would be financially foolish, whether it's the wrong stock, bond, boat, house, or other real estate.
You have to consider the motive behind the message. Kiyosaki wants his readers to feel okay about poor life circumstances, become convinced they can change them in a quick burst of risk taking, and buy whatever seminar scam he's being paid to pitch at his shows. It's a con.
I think Kiyosaki was only thinking of earning a million bucks when he published the book. The book is supposed to be a non-fiction about financial literacy but there are a lot of missing points in the book. He did not even clearly distinguish the difference between an asset and a liability like a 5 year old kid would understand. I was even more disappointed when I knew that Rich Dad did not really exist. What a shame!
I've now read the book twice and I can see that a lot of the "negative" posts are made because they are taking most of the initially stated concepts for hard truth or at face value. He tries his best to describe the concepts analytically and give his readers a simpler insight to the seemingly overwhelming world of investing. If your a speed reader then I'm sure most of the message went in one ear and out the other with out taking a moment to digest the material transposed. Try again reader, this time listen.
Robert doesn't allow the predefined rules of this world run his life. He redefined the word "asset" to mean something that creates an income stream bigger than the expenses attached to it. So while you guys split up associated properties from their attached expenses and liabilities, he lumps it all together and defines the net result as either an asset or liability.
Very uneducated opinion. Go follow the herd, buddy. Diversification is for suckers. I won't be lead to the slaughter.
I am an accountant. Yes, house is technically an asset, but Robert said he's redefining it and saying assets is what outs money in your pocket. In this case, your house and car is a liability because you pay mortgage/financing and insurance when all that it does is take money out of pocket.Mortgage interest is an expense. Your house is a liability until you own it free and clear usually 15 or 30 yearsthen it becomes an asset.
He never said that higher education is not worthwile because learning is not a bad thing. However just doing it to get a job shouldnt be the reason becuse there is no such thing as a good job since your employer controls your hours and pay. They can lay you off any time.
Im a grad accounting student, i can see how he considers owning a house as a liability, im fine with that statement. The equity in your home is an asset but if you havent fully paid off your mortgage you have a liability.
Thanks for the link to the epic takedown by John Reed. I couldn't stop reading.I had an icky feeling while I read this book but I don't know enough about investing/real estate to call all the bullshit (the bit about the cat and insider trading both were huge red flags to me, though). I'm glad to have read a professional's opinion.
You're right. It's so bad. Exaggerates claims about making money in stocks and real estate while oversimplifying those processes and the whole of consumer finance. Also irresponsibly simplifies poverty victim-blames those suffering from it.
The only investment guide you'll ever need
I actually think he made sense ,when everyone thinks - owning a house is an asset, yes it is and for a certain period of time,When one fails to pay taxes as well as to maintain the house, after 10 to 20 years , it starts to be a liability. The books tells us to do what we can to make it an asset as far as we can. Some homeowners have different ways of making it an asset for as long as they are around. This books gives so much common sense, even to those ideas that we never even thought of.... I did have a hard time too accepting the very first few part of book but later, when i owned my own company , I somehow understood what he was talking about.
What books do you recommend?
this guy is just a con artist. if you look at his life, he never got rich until this book went off. then he used MLM and his scam seminars to amass capital and start buying properties. in the book he advocates: insider trading, defrauding the government, and taking advantage of home sellers. in his real life, his 2 business ventures before he wrote the book went bankrupt. idk about you, but if you're a fan, that's a reflection of your values.
I completely agree with you. He says that the house is a liability but then he invests in real estate, I really lost myself during this explanation of assets and liabilities.
I only hate that I cannot give your comment more likes...I also think that this book is a complete waste of time...and very dangerous for a person that is about to form himself. The only value I see in it, is getting someone hyped and eager to know more about financial education.
Dan you're exactly the pathological fool this book warns against becoming
He said a house is a liability if it’s taking money out of your pocket and an asset when it’s bringing in money which to a smart person would make total sense. You guys are to smart for your own damn good smh. All this negativity and your missing the whole point.
Your house isn’t an asset unless it’s paid off and rented out to someone else. If you have a mortgage it is not an asset.
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Everything is up for personal interpretation, some comments made have too much emotion attached.. so what Rich Dad or Poor Dad does not exist... the message is obvious even to the uneducated..stop blaming or thanking others, if you don’t want to be pushed or carried around all your life, work for nothing once in awhile and realise you are the driver behind the steering wheel and perhaps one or two words might resonate positively in someone’s mind...
This book has some jewels in it but it also grossly oversimplifies many concepts. It’s also patently false in some explanations. It’s also the first book I’ve read that actually has chapters that summarize the previous chapter’s ideas. It also has a glossary that defines such “complex� terms as “bond�, “corporation� and “entrepreneur�. It praises anti-intellectualism and well, the writing reflects that. I can’t believe this is the Bible of personal finance.
I think you completely missed the point of this book.
College is absolutely a waste of money for most people. Don’t kid yourself. Anything you can learn at college, you can learn from the library, but it’s just the question of whether or not you have the motivation and discipline. College is great at motivating, yes, in that you don’t want that $60k+ to go to waste. But come on.
This is helpful. -Isaac Samuel Miller (Author of, Just Get Up And Manifest Your Inner Genius)
I was only 16 years old when I became an entrepreneur, & it was really easy to understand that your house is a liability when it does not generate income. Very easy to understand.
I'd be interested to have the author rebuttal. 🤷🏽♂�
I suggest you read the book again, because you certainly did not get the point of the book. Also the author did not state that education is useless just that you do not need it to be sucessful, and he is completely right that the education system doesn’t teach you how to get financially free or about the mechanics of money in general. Assets are the way to get rich, ever saw someone become filthy rich from a 9 to 5 job? Several people in my network have tried this method and became financially independent from there job. Also in the book the author states that people who scream the loudest that it’s false information never did follow these steps, so they only think they know that it doesn’t work. If you didn’t walk the path yourself you never know for sure
It gives a great information. It is just about the ideology, which I more important than you think. Rich dad does exist, there is an interview with mike (the son of rich dad). It doesn’t teach you to be rich, it teches you to have a financial stability. One think that I don’t like form the author is that he always write about the ideology in all his books. He gives the same information and there is a bit of new information. So Robert, if you are reading this, ¡give us more info!
This is not a fair or accurate review. Kiyosaki explains his reasoning behind the definition of liability and assets and himself admits that your banker/accountant lists the home you live in as an asset. Cash flow is a real and tangible thing! If you missed this point in this short book, I don’t think it has been comprehended, maybe not at all.
I always find it funny when people leave negative reviews on books like this. All Robert is trying to do is shift people’s perspective on money and entrepreneurship. If you hated the book or feel like he’s lying you might want to take a look at your own limiting beliefs, and understand why you’re so resistant to what he has to say.
You can create your own wealth. It just might not be easy and will require losses, sacrifice, and creativity. If you can’t accept that no wonder you hated or missed the point of this book, you were probably never meant to be wealthy.
Great read!!
I agree when he says owning a house is a liability. It definitely is when the mortgage is not paid off. You are not earning from it, rather paying the debts every month with interest compunded. Also, it is a liability if the house doesn't generate enough rent (if given on rent) and the loan you pay every month is higher than the rent you get for it. It is a liability if you pay more taxes on it than you earn from it. What the author wants to state is that owning real estate is an asset as long as it generates enough income for you. For e.g. if you buy a house and put it on rent and the rent amount generated is too high, you are in profit. You are getting paid from that property more than you are giving off.
Also, he never disregarded the idea of education. If you would have read the initial few pages correctly, it is mentioned that education is equally important but so is financial education. Later, he also emphasises on having a stable job while building assets for yourself.
Thank you very much for pointing out that this is, in fact, a MLM scheme. In a way, it sure did work for Robert since he's making great money by perpetuating misinformation and exploiting vulnerable and/or gullible readers.
Goes to show that if only you, dear reader, would find it in yourself to exploit other people and blame them at the same time, you too can make fast cash!
Howerver, as with all of kiyosaki's books, he takes a few principles that could be described in a breif article and tries to streeetttccchhh them into a full series of books. And he doesn't write very well, and his stories don't hold up. Now that is a method to getting rich I could embrace.
Stay tuned for Bridey's "How I became rich by paraphrasing Rich Dad's theories" full 26 volume set.