Rich Dad Lessons: The Quick Reference Guide To Wealth
Based on Kiyosaki’s work
Alan Jacques is President of a successful Canadian company and excellent teacher of subjects related to money, wealth and entrepreneurial businesses.
This is his Quick Reference Guide To Wealth inspired by Robert Kiyosaki’s work:
| Broke Masses | Successful Middle Class Investor | Rich | |
| 1. Who | Employees | Employees & Self-Employeed | Business Owners & Investors |
| 2. Education | Highschool or college graduate | - Values Education, often college graduate - Attends course and seminars on investing |
Values only “street smart education”, often aquired from peers and/or self-learned |
| 3. Major financial goal | To survive until next payday | To build up a significant net worth by age 55-56 | Freedom |
| 4. Focus | Salary or hourly wage | Net worth | Cash flow |
| 5. Cash Flow Management (CFM) | “How much do I have in my wallet?” | Understands the value of CFM | Understands that CFM is the foundation to all wealth |
| 6. Definition of an asset | A 6-pack in the fridge | Anything that has market value | Anything that produces a positive cash flow |
| 7. Home | Would like to own one | One of their most important assets | A home is a liability, not an asset |
| 8. Investment vehicles | -Government pension - Lotteries |
- Mutual funds - Blue chip stocks - Real Estate: condos, houses & duplexes |
- Stocks: IPOs as investors and/or key shareholders - Real Estate: larger projects - Businesses |
| 9. Investment sources | The government | Invests in financial products created by others | Creates products and services to sell to the Middle Class and the masses |
| 10. Investment systems | Hope | - Dollar cost averaging (DCA) - Low down real estate systems |
- Create their own or modify others - Often learn from other rich investors who are their peers |
| 11. Expected rate of return | Get rich quick | 12% to 30% | 50% to 500%+++ |
| 12. Risk | Has no idea how to evaluate it | Accepts moderate risk | Most investments are low or very low risk |
| 13. What works | If it doesn’t work, keep doing it | Learn what works and keep doing it no matter what | Keep learning and innovate, innovate, innovate |
| 14. Time horizon | Next payday | Long term | Tailored to each goal or investment |
| 15. Real estate | Would like some | Buy & hold, waits for it to go up in value | “You make money when you buy, not when you sell” |
| 16. Most valuable resource | Paycheck | Investments | Time |
| 17. Why work? | Work for the weekend | Work for money of which 10-20% goes to investments | Money works so they don’t have to |
| 18. Advisors | Broke friends & family | Financial planners, accountants | Themselves, each other, coaches, selected professionals |
| 19. Resources | TV | - The Millionaire Next Door - The Wealthy Barber |
- Rich Dad/Poor Dad - The Cashflow Quadrant - The Cashflow Game - Robert Kiyosaki tape sets |
| 20. Key indicator event | Savings account with $100 in it | $1 million net worth | Passive income exceeds expenses |
| 21. Questions and Answers | Don’t really understand the distinction | Asks questions and seeks the right answer | Knows there are many answers |
| 22. Delegation | “If you want it done right, you have to do it yourself.” | “You can delegate what you don’t know” | “If you don’t know the fundamentals, you can get slaughtered!” |
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January 18th, 2008 at 10:29 am
I have a free copy of Robert’s book Rich Dad, Poor Dad that I’m giving away on my blog. Check it out at Prime Time Money.