Rich Dad, Poor Dad Summary

One Paragraph Summary This book, a New York Times bestseller, has become a classic in the financial advice category. It shows you the steps needed to become financially independent. Kiyosaki knows what he is talking about as he retired at the age of 47.

Rich Dad, Poor Dad Summary

Rich Dad, Poor Dad—What the Rich Teach Their Kids About Money – That the Poor and the Middle Class Do Not!
A book by Robert T. Kiyosaki

  By writing this book summary, I learned the following three things:

  • Having a profession in the financial industry is a huge bonus
  • It is hard to become financially independent with a 9-5 job
  • Knowing what comes in and what goes out is essential

Key Ideas

Avoid society's mantra

Got to school, study hard, get a good job.

If you follow this path, you will probably avoid starving of poverty; but it will neither make you financially independent, nor will it make you wealthy.

This is outdated career advice. If you get into the right school, study hard, and get a well-payed job, it will allow you to make a living, but it will not make you wealthy. And this path will not let you leave the rat race.

Walking down the traditional path of making a living will make your bosses rich, not you.

Fear and greed hinder you from reaching financial independence

There are two basic emotions, fear, and greed, that influence most of the financial decision making on the planet, for the wealthy and the poor alike.

Fear: People having no money fear they will never have enough money.

Greed: People having money focus solely on the new, shiny things they can buy with their money.

Wealthy people can keep their fears and greed under control. They do not allow those emotions to influence their financial decisions.

If you have money left, you should not buy a bigger house, because this will also mean, among other things, paying higher utility bills. Do not be greedy; invest the money in assets instead.

At the same time, if you have money, but fear to lose it, it might hinder you from investing that money in an asset like stocks.

Financial intelligence

Most people are not well-equipped to make sound financial decisions. How could they? In most schools, we do not receive the necessary knowledge. We have no financial intelligence.

The common perception that to become rich, you only need to be talented and capable is flawed. What most people are missing to become wealthy is an education in financial matters.

Luckily you can build your financial intelligence by learning about subjects like saving and investing.

The building blocks of growing wealthy

There are building blocks you need to master to become wealthy.

Appraising your finances, setting yourself financial goals, and acquiring financial education to reach those goals is a good start to become wealthy.

Today there are so many resources available for our financial education that it is only a matter of learning the material provided to us. You can take on classes about finance, book a seminar, read books and got to meet-ups.

Invest in assets and avoid liabilities

The first thing you need to learn to become financially independent is the difference between an asset and a liability.

A liability costs you money. On the other hand, an asset earns you money.

It is obvious what you then need to do: invest in assets and avoid liabilities.

Assets have some common characteristics:

  • produce income
  • appreciate over time
  • can be sold rapidly

Examples for assets are income-generating real estate, stocks, and intellectual property.

You need to be careful not to mistake liabilities for assets. For example, many people buy a house to live in. This purchase is a liability because it takes away income from you each month. It might be better to invest that money in an asset that earns you money.

Your business will make you wealthy, not your profession

There is a difference between a profession and a business you need to know. That what you do as your day job usually is your profession. Or, in other words: The title that earns you the money to pay the monthly utility bills.

A business is an endeavor you invest time and money in to allow you to grow your assets.

To gain financial independence, you should take some of your money earned from the profession and use it to build a business. Do this until your business is sustainable enough and grows organically.

Over the long turn, your business will bring in more money than your profession. And this is what you should be working toward as this is what will make way to your financial independence.

Learn to manage risks

If you are not financially independent today and have not started the journey, you need to begin to handle your finances differently. You need to learn to take and manage risks.

For example, if you have not invested in assets before, you need to take the risk to do so. But don't do this blindly, there are lots of good books on investing in the stock market, for example. In these books, you will also learn how to manage your risk with asset allocation and portfolio theory.

The list of wants, and don't wants

Becoming financially independent is a long and challenging journey. At times it will be hard to stay motivated when a setback occurs.

Kiyosaki recommends keeping a list of wants and don't wants. For example:

  • I want to escape the rat race
  • I want to be debt-free within the next two years

Another right way to stay motivated is to read biographies about people who have achieved what you want to accomplish for yourself.

You can be busy and lazy at the same time

Even people who are working 60 hours in their business can be considered lazy if they are avoiding the things that need to be done.

If a man is working 60 hours a week but spends little or no time with his family, he is in that regard lazy. And at some point in time, he will suffer the consequences: having alienated children and being divorced.

First Insight: Having a profession in the financial industry is a huge bonus

Winners are not afraid of losing. But losers are. Failure is part of the process of success. People who avoid failure also avoid success.―Robert T. Kiyosaki

Working in the financial industry as a professional is a massive advantage in our society. And I don't mean the computer scientist who works in a bank. Just being in that environment will not be enough. You will have to gain what Kiyosaki calls financial intelligence. The best way is to align your formal education with your long time vision.

If you work in a bank as a computer scientist, you will probably just be in the environment, but you will miss the opportunity to learn the ins and outs of the industry.

So if you have any interest in the financial industry, it is probably better to study math and become a quant than to study computer science and keep the trading software for an investment banker running.

Second Insight: It is hard to become financially independent with a 9 to 5 job

Workers work hard enough not to be fired, and owners pay just enough so that workers won't quit.―Robert T. Kiyosaki

A friend of mine has become financially independent by working a 9 to 5 job. As far as I know, he did not read Kiyosaki's book, but he did intuitively what the author recommends. Take your left-over money and buy assets like real estate and stocks.

I never achieved this, because most of the time I bought time instead of money. Every time I had some spare cash, I spent it for month-long trips to exotic destinations. But now I know better. Instead of buying time, I will purchase assets and invest in my business.

You're only poor if you give up. The most important thing is that you did something. Most people only talk and dream of getting rich. You've done something.―Robert T. Kiyosaki

Third Insight: Knowing what comes in and what goes out is essential

Most people fail to realize that in life, it's not how much money you make; it's how much money you keep." ― Robert T. Kiyosaki

Keeping a budget is probably the best thing one can do to build wealth. If you do not know where your money goes, it will be hard to funnel it in the right direction.


Kiyosaki provides excellent advice in his book. But he also stresses that it is crucial to start now.

What can you do today to put yourself on track for financial freedom? You can make some research on the next books you want to read on the topics of investing and building a business.

Another thing that is vital for your success is to keep an Excel or Numbers sheet with your monthly income and expenses. This sheet is also an excellent place to keep track of your current assets.

Another equally important point, especially if you want to build a business, is to network with like-minded people. What meet-ups could you join?


  • Do not follow the traditional career advice blindly.
  • Avoid fear and greed
  • Avoid anxiety and invest left-over money in assets
  • Avoid desire and invest left-over money in assets
  • Don't allow fear and greed to make irrational decisions
  • Build your financial intelligence
  • Set yourself financial goals
  • Invest in your mind with education
  • Work for what you learn, not what you earn
  • Invest in assets which bring money in
  • Avoid liabilities which take money out
  • Build a business while you still hold on to your profession
  • Use your left-over cash from your job to invest in your business
  • Learn to take and manage risks
  • Avoid personal pitfalls like laziness and arrogance

Rich Dad, Poor Dad Summary—related resources

  Read more about Robert T. Kiyosaki on his.

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If you liked reading the Rich Dad, Poor Dad Summary, you should also read The Millionaire Fastlane Summary.

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