Robert Kiyosaki - Rich Dad Poor Dad for Teens
Your Journey To Financial Freedom Begins Here
- "If you want to do something - and you think you can - chances are, you'll get it done."
- Financial literacy allows you to not fear money matters, and to see the real value of money.
- Your financial education will train you on the job.
- There are things you learn in school and things you learn in life.
- Carry a notebook with you during the day to jot down ideas or thoughts that come to you.
Part 1: The Language Of Money
Financial Intelligence: A New Way Of Learning
- You are smart! We all learn differently. The trick is to find the way you learn best. When you do that, you'll discover your own personal genius. Have a good attitude about learning.
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Eight different types of intelligence or learning styles: (Howard Gardner, Frames of Mind)
- Verbal-linguistic intelligence
- Numerical intelligence
- Spatial intelligence
- Musical intelligence
- Physical intelligence
- Interpersonal intelligence
- Intrapersonal intelligence
- Natural intelligence
- (Vision)
- Discovering your learning style and your personal genius is the first step to having confidence - confidence that allows you to see and pursue opportunities, and to take risks.
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One's IQ can change. You can "pump up" any
area - such as your financial IQ - if you're determined to
exercise your brain, for example by:
- talking about it
- reading about it
- writing about it
- taking your allowance seriously
- doing your own audit
- deciding to become responsible for your future
- The ways in which we learn - which might be a combination of learning styles - add up to our winning formula. Ask: "How can I afford the things I want?"
- The best way to get what you want is to believe you can get it. Thoughts are powerful. You can make things happen if you set your mind to it.
Part 2: Rich Dad's Money Secrets
Rich Dad's Money Secret: The New Rules For Making Money
- When you play a game, you've got to know the rules, because the rules define how to succeed at the game.
- People think differently about money. Are you always looking for business opportunities? "What you think is what you get!"
- People sometimes talk about the "haves" and the "have-nots", and that the "haves" - the rich - think differently. It is possible to "think rich" and it is possible to make a choice to be a "have" or a "have-not".
- Working with someone else can be very rewarding, emotionally and financially. It allows you to bounce ideas off another person. Anyone can be your mentor.
Rich Dad's Money Secret: Work To Learn, Not To Earn
- "You're only poor if you give up. The most important thing is that you do something. Most people only talk and dream of getting rich. Keep going. Don't quit."
- "Life is the best teacher of all. Life doesn't talk to you, it just sort of pushes you around. Each push is life saying 'Wake up and learn'."
- Do not let your emotions - especially fear - make the decisions for you. When a situation "pushes your buttons", take a step back and try to assess the situation coolly, using your inter- and intrapersonal intelligences. Being financially successful means learning to follow through with your plans.
- "Money is an illusion." The toys we want get bigger and bigger and more expensive as we get older. Adults fall to these temptations too. People who are already rich seem to know it: Work to learn and to have your money work for you. "If you do not need money, you will make a lot of money."
- If you have the right attitude, doing a repetitive task can be meditative and energizing.
Rich Dad's Money Secret: "My Money Works For Me"
- "Work to learn, not to earn." Keep using your brain, work for free, and soon your mind will show you ways of making money far beyond what could ever be payed to you. You will see things that other people never see.
- Have the business run itself. Have your money working for you.
- Think about ways to put your wish list of things you want together with the list of intelligences and learning styles. Keep your eyes and ears open. The next time you hear the words "I wish we had..." think about whether there's a way you can create a business to meet that need. Whatever service you're providing, work toward building a bigger business where money can be made even you aren't working.
Rich Dad's Money Secret: Create Money
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Three types of basic income:
- Earned income
- Passive income
- Portfolio income
- "The key to becoming rich will be your ability to convert earned income into passive income and portfolio income."
- "Know the difference between assets and liabilities, and buy assets."
- An asset puts money into your pocket. An asset should generate income on a regular basis. While you might consider everything of value an "asset", it's not really an asset until it is sold. Anything that you own that produces passive or portfolio income is an asset.
- A liability takes money out of your pocket. Liabilities include also everything that you owe.
- Assets can be deceiving. Something that might seem like an asset can turn into a liability. Doodads go down in value the minute you buy them. So buy assets that produce income. Better yet, keep your eyes and ears open for ways you and your friends can start a business.
Rich Dad's Money Secret: It's All About Cash Flow
- The easy way to keep track of assets and liabilities is a financial statement. The financial statement shows the relationship between what you have and what you owe.
- An income statement is also called a profit and loss statement, which actually describes its purpose more clearly.
- A balance sheet shows the relationship between assets and liabilities.
- The pattern of money coming in and going out is called cash flow.
- The amount of earned income is not directly proportional to your total wealth.
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Sample categories for your own financial statement are:
- Food
- Clothing
- Sports items
- Transportation
- Entertainment
- Drugstore items
- Beauty and grooming
- Pet supplies
- Big-ticket items
- Save the receipts. Every time you take out your wallet to pay for something, ask for a receipt. Every time you buy something, write it down.
- To get your net worth, subtract the liabilities from the assets. Your net worth should be a positive number.
- When you truly know the difference between an asset and a liability, you'll be able to start buying real assets.
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There are lots and lots of ways to stretch your euro:
- "Recycle" old clothing.
- Have lunch at someone's house.
- Buy any supplies that you buy regular in bulk and buy them on sale.
Rich Dad's Money Secret: Play Games To Learn
- "Games are a reflection of real life. The more you play, the richer you become." Playing games is like getting a vitamin-packed dose of real life in a safe and entertaining setting.
- Get out of the Rat Race - that endless cycle of earning money and paying bills - and move to the Fast Track, where your assets are earning money for you and you're getting passive income.
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Types of losing players:
- People who take the longest are people who don't feel comfortable with numbers and who don't see the power of investing.
- There are a lot people who have a lot of money but don't get ahead financially.
- Some people wait for the "perfect" opportunity, as opposed to taking risks.
- Other people see all the great deals coming, but say they have no money to cut the deals.
- Most people have an opportunity of a lifetime flash right in front of them, but they just can't see it.
- Rich people who play a game don't ever sit on the sidelines.
- Financial intelligence means creativity in solving financial problems. If opportunities aren't coming your way, what else can you do to improve your financial position?
- "Report cards are what you get in school. When you are out of school your banker will not ask you for your report card. He will ask you for your financial statement."
- Another great learning opportunity is the field trip that gives you the chance to see some things in action that you may have only read about.
Part 3: Creating Your Own Cash Flow
Moneymaking Opportunities For Teens
- You can offer a skill or service that people want and need and are willing to pay for. Instead of being an employee, be an entrepreneur.
- Write down a few careers that come to mind. Write a list of jobs that you have access to. When thinking about where you'd like to work, think about your goals first. Find opportunities that you can create for yourself.
- Exchange is a very important concept that teaches you how to survive on your own. "You can have anything you want as long as you're willing to exchange something of value for what you want." In order to create a fair exchange, you must learn what each job is worth to you. Look at opportunity, not salary. Stay away from jobs in which you raise money for someone else.
- Employers are looking for people who are inventive and who take initiative.
- The best way to find about working is to find your own mentor - someone who's successful in the field you want to pursue. Your mentor is like a 1-on-1 coach, someone you can turn to when you have questions, and someone who cares about you, too.
Managing Your Assets
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Three piggy banks:
- Charity
- Savings
- Investments
- One of the really great things about being rich is the ability to help others. To be truly rich, we need to be able to give as well as to receive. Charitable contributions are tax deductable, which means that the more contributions you make, the less you pay in taxes.
- The piggy bank for savings represents security.
- The piggy bank for investments respresents risk and learning, and buying and building assets.
- The formula is to fill the three piggy banks and (the opposite) to keep your money moving.
- With a Return On Investment (ROI) of 100% you still own the asset, but you have none of your own money in it anymore, and thus all the income you receive provides infinite return on the investment.
- Money without financial intelligence is money soon gone.
- Pay yourself first (George Clason, The Richest Man in Babylon) - even when you come a little bit short once in a while, don't dip into your savings.
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Key questions when opening an account:
- Which accounts require a minimum balance?
- Which accounts offer higher interest rates?
- Which accounts allow you to write checks and withdraw money on demand?
Managing Your Debt
- "If you want to be rich, you must know the difference between good and bad debt."
- If you can't resist temptations to buy doodads and have trouble keeping your money in your wallet, don't have a credit card! However, if you use a credit card wisely - that is, if you pay your bills in time - you'll have an excellent opportunity to establish a good credit rating.
- With each euro that comes your way, you have the power to determine your destiny.
Your Financial Head Start
- Be the kind of person who creates his own luck and his own money. Take what life hands you and make it better.
- Be careful from whom you take advice. If you want to go somewhere, it's best to find someone who's already been there. "Professionals have coaches. Amateurs do not."
- The six people you spend the most time with are your future.
- Your change has only to do with you. You want to change your future. To successfully change your future, you have to change your thoughts, and, as a result, the people you spent time with. Choose to spend time with people who understand and appreciate your vision and goals - or even share them!
- Our strongest asset is our minds. If it's trained to see opportunity, it can create wealth in a short amount of time.
Posted on 4th September 2007 by Quintus Hegie
