Millionaire Thinking Blog

Rich Dad Poor Dad Summary – Robert Kyiosaki

Today I’m going to share with you what I learned from Robert Kiyosaki‘s book “Rich Dad Poor Dad”. But first of all, I want to tell you that I slammed myself while reading this book. It was one of the first books I read about financial independence and it changed a lot of things in my life. In fact, I realized that after all my years of study, I did not know how to manage my life in general and more specifically how to manage my finances.


Let’s get to the heart of the matter, the first thing to know is that we can divide everything we have into two categories. Things enrich us and things that impoverish us. Something that enriches us is called active and something that impoverishes us  is called passive. Examples of assets could be real estate investments, stock market investments such as the purchase of shares or bonds; a business that you have created, or anything that comes out of the intellectual property: a book that you wrote, tables that you will sell or a song. Passives could be loans, consumer credit, car, televisions, etc. To become rich and above all to become financially independent, the goal is to have a maximum of assets and the minimum of liabilities to the extent possible. I know this concept may seem simple, but the most revolutionary concepts are simple. So do not take it lightly.



Is your house an asset or a liability? In fact, it depends.


  • If your house is costing you money every month, then your house is a liability.
  • If on the other side, you rent your house and it brings you money every month, in this case, your house is an asset.

Imagine that you earn 10euros / hour, you have to work 100 million hours to become a billionaire. But who has 100 million hours in his life? … That’s it, nobody. So, when you work to make money, when you trade your time for money, it’s called active income. If you count on your active income to enrich yourself, it will take many lives before you get closer to the billion, except if you’re an NBA player or a Hollywood star who earns hundreds of millions of dollars a year. And again, even for these people it is very hard to get closer to the billion.


On the other side, there is the income that is called passive income. In this case it is the money that works for you. Money works for you 24/7, and even while you sleep. Take the example of real estate investment. If you bought an apartment on credit and the credit plus all the expenses cost you 500 euros. And you rent the apartment to tenants for 700 euros per month. In this case, you earn 200 euros of passive income every month.


Passive sources of income, once set up, do not require more effort or a minimum of maintenance. And they generate money automatically. For example, once you have invested in the stock market and stocks have appreciated, it is money that comes in without any further intervention on your part. Just repeat what you did to win more. Your income does not depend anymore on your time. If we take the example of the apartment that brings you 200 euros per month. If you rent 10, it will generate 2000 euros per month. At this point, this business will require more effort in terms of cleaning, key management if you do seasonal rentals, guest management, etc. So, you could outsource these tasks to a third person by returning a portion of your income.


Robert Kiyosaki places great emphasis on financial education and the fact that the education system does not teach us anything about it. We do not learn at school how to generate our money or just keep it. The idea of Financial Independence is not mentioned in any textbook. The education system prepares us to become good employees, who will work all their lives to enjoy retirement after 40 contributions. Robert Kiyosaki is not a big fan of this scheme of life, he calls it the “rat race”.  He also talks about the trap: to study, find a job, get into debt over 30 years to pay for the house, the car and the big TV and therefore feel obliged to continue working to pay off the debt.


After reading this book, I reconsidered the option of buying a principal residence and instead chose the option of investing and generating passive income first before thinking about buying my home. So, pay close attention to your expenses, you probably do not need the last iPhone or last pair of Jordans. That’s what happens to most people. They get their pay, rush to buy a lot of gadgets, shoes, watches, a new TV, the latest laptop, go to the restaurant 4 per week, etc. And ends up with an empty account at the end of the month.


Whereas in order to invest, you have to save.


Robert Kiyosaki talks about a concept that I found quite strong is the concept of paying yourself first. Again, it’s pretty simple to understand but not many people actually put it in place. So, you decide how much money you want to spend on your financial independence each month. When you get your salary, the first thing you do is pay yourself first, it is to put this sum of money on an account dedicated to your financial independence. Then you pay the bills, you pay the rent, then the taxes, and finally the hobbies, etc.


If you read the book, you will learn much more than what I have just shared here. But to summarize it: the rich do not work for money but make money work for them. To access financial freedom, one must reduce one’s liabilities and increase one’s assets. And finally, pay yourself first.


More: Books are the roadmap to success. Here is a list of books Bill Gates recommends young people to read.

Ilias Aghrim
Ilias Aghrim is an entrepreneur and online marketer from Germany. He is the founder of Millionaire Thinking, Miss Orient and the CDO of the Smart Students and Youpendo App. When not building online businesses or apps, he can most often be found at the gym, the library or traveling the world.
Leave A Comment