I read rich dad poor dad recently and I find it quite
interesting. Below is a summary of what it is written
Differences between a rich person and a poor person
The poor person has a habit of putting his brain to sleep when it
comes to money matters, the rich person had a habit of exercising
his brain when it comes to money matters.
The poor person thought that the rich should pay more in taxes to
take care of the poor.
The rich person say taxes punish those who produce and reward those
who don't produce.
The poor say study hard so you can find a good company to work
for.
The rich say study hard so you can find a good company to
buy.
The poor say when it comes to money, play it safe, don't take
risk.
The rich say learn to manage risk.
The poor is concerned about pay rises, retirement plans, medical
benefits, sick leave, vacation leave and other peaks. the idea of
job protection and job benefits seems more important than the
job.
The rich person believe in total financial self-reliance.
The poor struggle to save a few dollars.
The rich simply created investments.
The poor is always thinking about how to write a better resume so
that he can find a good job.
The rich thinks about how to write strong business and financial
plans so he could create jobs.
The poor say he is not interested in money.
The rich say money is power.
If you are a person with no guts, you will live all your life
playing it safe, doing the right things, saving yourself for some
events that never happen. You die a boring man. You will have lots
of friends who really like you because you are such a nice
hardworking person. You spend a life playing it safe, doing the
right things but you know in your heart that you let life push you
into submission. Deep down you were terrified of taking risks. You
really wanted to win but your fear of losing was greater than the
excitement of winning.. deep inside you will know you didn't go for
it. You chose to play it safe.
Its fear that keeps people working at work. The fear of not paying
bills. The fear of being fired. the fear of having not enough
money. The fear of staring over. That is the price of studying to
learn a professional or trade and than working for money. Most
people become a slave to money and than become angry with their
boss.
An asset is something that puts money in my pocket.
A liability is something that takes money out of my pocket.
A intelligent person hires person more intelligent than him.
The middle class find itself in a constant state of financial
struggle. Their primary income is through wages and as their wages
increase so do their taxes. Their expenses tent to increase in
equal increments as their wages and hence the term "the rat
race".
Wealth is a person's ability to survive so many days forward or if
I stop working today, how long could i survive?
The rich buy assets. The poor only have expenses. The middle class
buy liabilities that they think are assets.
The mistake in becoming what you study is that too many people
forgot to mind their own business.They spend their lives minding
someone else business and making that person rich.
The rich focus on their asset column while everyone else focus on
their income statement.
The ideas of "I need a increment. I need a promotion. I am going to
study more so I can get a better job. I am going to work overtime.
I need a second job" focus on the income column and will only help
a person become more financially secure if the additional money is
used to purchase income generating assets.
Keep your expenses low, reduce your liabilities and build a base of
solid assets. Start building a solid asset column before getting
married, buying a house, having kids etc and getting stuck in a
risky financial position, clinging on to a job and buying
everything on a credit.
Real assets fall into these categories:
Business that do not need my presence. I own them but they are
managed by other people. If I have to work there, its not a
business. It is my job.
Stocks.
Bonds.
Mutual funds.
Income generating real assets.
Keep your daytime job, be a hardworking employee but keep on
building your asset column.
Rich person buy luxuries last while poor and middle class person
buy luxuries first.
