Review Rich Dad Poor Dad by Robert Kiyosaki — “If you don’t study hard, you will be a trash collector.” I had a PhD yet I am still jobless.

"Rich Dad Poor Dad" is a personal finance book written by Robert Kiyosaki back in 1997. This book is almost as old as I am, and yet I just had the chance to read it two weeks ago. But as the old saying goes, "You are never too old to learn more than you already know and to become able to do more than you already can."

Throughout the book, Kiyosaki shares various financial lessons he learned from his rich dad, including the importance of financial education, building assets, and understanding the difference between assets and liabilities. He emphasizes the idea of achieving financial independence by generating passive income through investments rather than relying on a paycheck.

Since I was a boy, my mom would always tell me that “If you don’t study hard, you will be a trash collector.” I had been instilled with this logic by my parents that if I am not educated, I will get a low-paying job. The more time I spent studying, the better pay I would get in the future. Today, I have a PhD in Mechanical Engineering, yet I’m still jobless. Instead of words of comfort, what I got from them is that “you have spent too much time studying and you have missed the opportunity to build your career.”

In the past decade, the number of PhD graduates increased from 1,247 in 2010 to 4,560 in 2020. However, the rate of unemployment for PhD holders has also increased from 7% to 16%. In a Graduate Tracer Study conducted in 2021 by the Higher Education Ministry, it was recorded that out of 2,501 PhD graduates, 2.5% were waiting for job placements and 8.8% were unemployed. In other words, if you know 10 friends who have a PhD, one of them is likely to be jobless, and the other nine are probably inventing some serum that might transform them into heroes or villains.

"Rich Dad Poor Dad" challenges conventional notions about money and advocates for developing financial intelligence and adopting a mindset focused on creating wealth. It challenges the traditional path of obtaining a good education and working for a steady income, instead urging readers to explore opportunities in entrepreneurship and investment. The point I'm trying to make here is that we have been living a lie about money and our qualifications all this time. We were taught in schools and by most of our parents that getting good grades, obtaining a degree, and securing a job is the key to living a happy and successful life.

While this approach may have been true for our parents' generation, where opportunities were limited and hard work was the primary means of earning a living, times have changed. Our grandparents' generation experienced war and lacked access to education, so for our parents, acquiring a degree and landing high-paying jobs was a significant achievement. They sought secure income, and government jobs with special privileges were highly coveted.

However, for our generation, with inflation on the rise and uncertainty surrounding the next economic crisis, maintaining the same mindset as our parents will likely lead to unemployment or debt. We need to reevaluate our approach to financial success and consider the lessons shared in "Rich Dad Poor Dad." It offers valuable takeaways that I believe are worth exploring. I encourage you to grab the book yourself and give it a read. But before doing so, finish this article first so you won't miss out on what it has to offer.

1. Mindset shift: The traditional mindset revolves around being an employee, earning a steady income, paying bills and debts, buying a car, purchasing a house, constantly striving for a higher-paying job, upgrading to a larger car, struggling with the new job, seeking yet another higher-paying job, and the cycle continues. This is the Rat Race in which most people find themselves. Instead of promoting this conventional mindset, Kiyosaki emphasizes the importance of financial literacy and understanding how money works. How can we achieve this? By adopting an entrepreneurial or investor mindset focused on wealth creation.
2. Building assets: Kiyosaki consistently stresses the importance of building assets, reducing liabilities, and minimizing expenses. A startling truth from the book is that your house is not your biggest asset, despite what the bankers and insurance agents want you to believe. In reality, it can be a liability. An asset is something that generates income for you, whereas a liability is something that takes money away from you. So, is the house you're currently living in generating income for you, or is it depleting your finances through taxes, maintenance costs, and insurance payments? If your house is generating passive income, then it can be considered your biggest asset. However, this doesn't mean we shouldn't buy a car or a house. As your assets grow, you can achieve financial independence. Instead of taking out loans, you can use your assets to purchase luxuries. The book emphasizes the value of acquiring income-generating assets such as real estate, stocks, bonds, or businesses. If your assets are capable of generating a consistent passive income, you can retire at any age without worrying about your retirement.
3. Rethinking the value of education: Schools primarily focus on training us to become good employees, but they often neglect to teach us how to build wealth. "Rich Dad Poor Dad" challenges the conventional belief that a good education guarantees financial success. Instead, it suggests that financial education, which encompasses money management, investing, and entrepreneurship, is equally important for wealth creation. Have we ever learned how to run a business in school? Even though I studied business and entrepreneurship, the curriculum primarily focused on government bodies, laws related to businesses, and basic accounting knowledge, which is indeed crucial for running a business. However, we never learned how to make money and generate passive income. We were taught to "play it safe" and avoid taking risks because running a business, investing in stocks, and buying real estate involve inherent risks. Yet, we were never taught how to manage these risks effectively. If these risks are well-managed, there shouldn't be any issues.
4. The power of passive income: Warren Buffett famously said, "If You Don’t Find A Way To Make Money While You Sleep, You Will Work Until You Die." The book highlights the significance of passive income, which is income generated without active involvement. If we can establish stable passive income streams that can support our expenses, we can escape the Rat Race. It ultimately comes down to our determination to achieve financial freedom and how soon we want to break free from living paycheck to paycheck just to cover our bills. There are various avenues for building passive income, such as real estate, stocks, bonds, or businesses.

In the past three years of working and doing business amidst the pandemic, I have witnessed numerous businesses fail due to lack of sustainability. I have also seen my parents and employers struggle with their own businesses. As an employee, I experienced the security of a steady income even during lockdowns due to government support. However, I also witnessed many colleagues lose their jobs and remain unemployed until the situation improved. These experiences have taught me the importance of selling the right product on the right platform with the right strategy. I have also discovered a well-managed business that offers zero risk and ensures exponential growth of passive income. However, the purpose of this article is not to promote that particular business. If you're interested, you can DM me for more information.

While reading "Rich Dad Poor Dad," I came across numerous mindsets that I realized were flawed within myself. However, I lacked the determination to change in the past. I understood that running a business could help me escape the Rat Race, but I neglected to focus on my own entrepreneurial pursuits because it is too comfortable to be an employee. I've heard many of these traditional mindsets from my parents, and I now need to unlearn them and adopt this new mindset. Some may criticize this new mindset, deeming it too risky. In fact, most people fail to realize that they are trapped in the Rat Race and mistakenly believe they are doing well within it. Such individuals often approach wealthy individuals and ask for two things; a job and a loan, rather than seeking guidance on how to make money. After reading this book, I couldn't stop thinking about its insights. It holds the key to financial freedom and building wealth.

So, how do we begin? Kiyosaki provides a practical step to embark on this financial journey, which is to make a list of all the things you "don't want" and all the things you "want" in your life. I have included some of my own examples in this article as a reference for you to create your own list.

What are the “don’t wants” in your life?

• I don’t want to work for money.
• I don’t want to miss memorable times with my wife and children.
• I don’t want to work for long hours.
• I don’t want to live paycheck after paycheck.
• I don’t want to beg for financial assistance.
• I don’t want to live in deficit.
• I don’t want to not be able to support others financially when they are in need.
• I don’t want my wife to work.
• I don’t want to not be able to go for vacation because I’m broke.

What are the “wants” in your life?

• I want to take control over my time.
• I want to earn a huge passive income.
• I want to give the best to my family.
• I want to spend my time with my wife and children.
• I want to be able to give freely and bless others financially.
• I want money to work for me.
• I want to retire young and retire rich.

All of us have experienced financial struggles. Regardless of our income, we often find ourselves living paycheck to paycheck because we increase our commitments in line with our earnings. Now, imagine this scenario: one day, your sibling approaches you and asks for financial support to cover their tuition fee because their loan is insufficient. What do you do? The most common response is to suggest they quit studying and start working, essentially becoming a college dropout. The second most common response is to provide for them while neglecting our own needs, which often leads to complaints, resentment, and strained relationships. However, if you have a stable passive income generated by substantial assets, you can easily pay for the tuition fee without any conditions because you genuinely care for your sibling. You can even give $10,000 to your nephew for his wedding preparations while he struggles to raise enough funds, and you will shine brighter than the groom. You can treat your parents to several vacations throughout the year. It is important to visualize this kind of picture in our minds so that we can be determined to break free from the Rat Race.

In conclusion, "Rich Dad Poor Dad" is an old book, and I only picked it up earlier this month, but it is already changing my life. It is never too late to acknowledge that our mindset may be misguided, to unlearn the wrong beliefs we have held, and to adopt a new mindset. I am confident that this book will also benefit you. Happy reading!