Let me just first start and say that I believe without this book I would not have gotten into entrepreneurship, business or investing. This book changed my outlook on life and my outlook on wealth creation and how the world works. It is written so simply that Robert makes business an easy topic for nearly anybody.
This book is about Robert's two dads. His real dad who he refers to as his Poor Dad and his Rich Dad who is actually his best friend's dad. The book goes through a life story of sorts as he grows up interacting with both of these dads. As he moves through his experiences with them he relays important information about the difference in mindset between them.
The definition of an asset
One of the most important concepts that I believe you should takeaway from this book is the difference between an asset and a liability. Robert talks about how his rich dad continued to build assets while his poor dad continued to buy liabilities growing up and that was the main difference between the two at the end of their lives.
Assets are anything that puts money into your pocket and liabilities are anything that take money out of your pocket. It's as simple as that. No need to worry about what accountants definition of these words are because ultimately it comes down to that simple point. Assets bring money in and liabilities take money out.
If you take anything away from this book I hope it's this concept. Too many people these days are enamored with consumerism and they buy liabilities that keep them from becoming wealthy. A new house, a boat, a car, a TV are all liabilities. They take money out of your pocket. real estate, stocks, dividends, and businesses all put money into your pocket. Know the difference and point them out in your life.
The most powerful asset is your mind
If you can't afford to buy anything at all assets or liabilities, just know that you already have one of the best assets in the universe. You have the power to make the change in your life. You have the one asset that has the potential to make you wealthy. Your mind. Make sure you continue learning new things and putting useful information into your mind.
If you approach your job as working in order to learn you are on the right path. People that see their job as a way to make money are looking at things wrong. Learning is the most important thing you can do and if you put money as the motivator for learning than you will enslave yourself, but if you put education as the motivator for learning than your mind will open possibilities you never would've thought possible.
Point 3 Mind your own business
I believe this whole heartedly. I think everything should have a business of some kind. In addition to a normal job and family I believe everyone should have a business. It's a great way to make more income, add value to other people's lives and keep more money in your pocket at the end of the day.
It's important to understand the difference between earned money, portfolio money and passive money. A normal job would be your ordinary earned income. Portfolio income comes from dividends in stock and passive income comes from real estate or other business ventures that don't require any of your personal time.
Taxes are another subject that Robert goes into quite a bit here because as you build up your own business you have the ability to pay yourself before you pay the government. He talks about as an employee you will always pay the government first, but as a business owner you will be able to pay yourself first and that's how to keep more money in your pocket and becoming wealthy.
I would say there are much more pros here than cons. I think the pros for this book are that it will change your mind about the world. It will teach you business concepts and tax concepts that are so simple a child can understand them.
One of the major cons to this book is that it focuses on real estate as being the primary wealth generator. It's typically true that real estate has been the vehicle for most of the wealthy, but it doesn't go into other business types as much.
Another point to mention here is that this book has lead many people to pay Robert for real estate seminars and multi-level marketing products. I happened to be one of those that paid for the seminar. This can be a good thing if you really need it, but for many they think it's a bit scam-like that Robert does this. Just keep this in mind.
This book is definitely for the first timer. If you have never thought about owning your own business or are on the verge of starting one this book is for you. I might even say that if you have no interest in starting a business than this book is also for you. It had the ability to change my mind about a lot of the business world and I'm better for it.
Other books like this one might be the Millionaire Fastlane by MJ DeMarco, but Rich Dad Poor Dad is a much simpler basics book. Others might be Think and Grow Rich by Napolean Hill and How to Win Friends and Influence People by Dale Carnegie.
This book gets a ten out of ten in my mind because it's the book that really convinced me that business was for me and that I could improve my situation with some education and business knowledge. It was just so easy to understand the concepts that I think anyone in the beginning stages of the business journey will benefit from reading this book.