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Rich Dad Poor Dad

Assignment # 3

E&L
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: Sameen Arshad
: Muhammad Aleem Tahir
: 01-134142-086
: BSCS-5D
: 21-November-2016

1- Summary of the book Rich Dad Poor Dad

This story is about Robert Kiyosaki's childhood in Hawaii and his two
fathers (one rich father and one poor father).
Rich Dad Poor Dad is organized into six main lessons that Kiyosaki
presents to becoming successful in his opinion:
1. The rich don't work for money
2. Financial literacy is key
3. Own businesses, rather than work at them
4. Understand taxes and the power of corporations
5. The rich invent money
6. Work to learn rather than work for money

These above six lessons combine the teachings of Kiyosaki's rich dad
with understandings from his particular lifespan. They contain frequent
themes, such as the rank of refining your financial IQ and financial
learning, a set of skills that Kiyosaki believes is lacking from the
current education method.
Kiyosaki was forced to choose between following in the footsteps of his
poor father which is a highly educated government worker or his rich
father whos an businessperson(entrepreneur) who never graduated
high school .
But ultimately, Kiyosaki decides to pick up most knowledge from his
rich dad.
The book focuses frequently on the education and financial advice
Kiyosaki learned from his rich dad. His rich father was able to build a
multi-million dollar empire from practically nothing, using his financial
insight and the power of his imagination.
Rich Dad Poor Dad also shows how the rich don't effort for money,
they force money to work for them. The rich get assets rather than
accountabilities. Kiyosaki stresses the importance of being able to
distinguish between an benefit and a responsibility. He states that in
order to be really rich, your skill column must be strong and able to

offset your living expenses. He explains that most people believe a


higher income will make them rich, but in reality, a durable asset
column will.
Rich Dad, Poor Dad discovers the power of corporations and
determines how the rich use corporations to house their money.
Corporations allow for expenses to be funded pre tax, saving the
business holder lots of money. Kiyosaki chase away the myth that
taxes offended the rich the most in its place he shows how numerous
rich people evade taxes and outsmart the system. Taxes truly hit the
poor and middle class much harder.
The purpose of positive thinking does not work is because most people
went to school and never educated how money works, so they spend
their lives working for cash.
Kiyosaki also explores the character traits and beliefs that hold people
back from becoming rich. He claims these problems can be grouped
into five different groups: fear, criticism, laziness, bad habits, and selfimportance. The book explores how each one of these influences
actions as an impasse to financial accomplishment and gives real life
cases.
Much of the book is fanatical to personal-reflection. He debates at
length the ways in which his rich dad and poor dad have influenced
him. Although he ultimately chose to match his rich dad, he still holds
some of the beliefs that his poor father held, such as the importance of
social duty and understanding.

2- What I have gained from this book?

I have gained a lot from this book that ,most of us learn how to make
money , how to get a job and work hard yet we don't learn how
to manage it, the important part.
(Two Dads, Two Different Philosophies, Two Different Outcomes)
It's also important to note that more money will frequently not solve
your commercial problems. "In fact, it may composite the problem
You don't need to be an expert, have an MBA, or even study private
finance books cover to cover to get financial intelligence. Start by
learning the change between an asset and a liability, the single most
important difference to distinguish if you dearth to get rich.

3 - What do you think the author has missed


the various gap factors in the book ?
Everyone has his/her own mean of life. According to Robert Kiyosaki's
an asset is anything that you acquire that puts money into your pocket.
However there are some gaps that as a reader would feel gap for
reader. Robert Kiyosaki's
has written this book on his personal
experience of having a rich dad and poor dad.
But you dont have this system everywhere in the world ,not everyone
is going the same phase as how author did. We may be facing more
hurdles although writer did great job in comparing both projections of
the two dads. Our country customs are different and writers are
different although he has motivated the reader in his own style but
sometimes those hurdles seem to be unbearable to escape and those
hurdles are of many types that may not exist there.
So for me this might be a gap factor that writer has just told his story
which yes covers important information and new things which we
didnt knew about but some are left exposed form others viewpoint.

4- Explain in detail the cash flow pattern of


an asset and a liability ?
Despite what many of people know, your carriage and your household
are not properties.

Its somewhat that gives you cash. Your car and your house do not give
you money, right? In fact, you have to pay for your household loan and
your carriage loan.
Assets are simply things that create cash-flows directly to
your pocket
And Liabilities , are belongings that take cash out of pocket. These are
the things that are essential to pay for, things that you owe, and things
that you need to purchase. So your carriage, your outfits, your Bills
are liabilities.
Then you need to buy as many assets as you can and decrease your
liabilities in order to form prosperity.
Most of the time, people have more liabilities than assets. If that
occurs, its not the end of the world.
Remember that you can always turn liabilities to assets.
One of the most debated ideas from Robert Kiyosaki is considering
your home as a liability. According to his meaning, it is a liability
because it does not put cash in your pocket and it grosses money out
of your pocket. We decide with these opinions but we trust that there
are other things to consider. For example a house does not depreciate
like a car.
As we all know, households can increase In value as years pass by. In
addition, most of the time, it is inexpensive to pay for a loan to own a
house than to pay for the rent to live in that household.
This is a condition we should look for and this is a method that in
statistic your home would put cash into your pocket by saving you
additional money for the rent.

5- Comment rich get richer and middle class


struggles ?
The main reasons that the rich get richer, the middle class struggles in
debt is that the matter of money is taught at home, not in school. Most
of us learn about money from our parents. So what can poor parents
say to their children about money. Someone simply say, Stay in school
and study hard. The child may graduate with excellent grades, but
with a poor persons financial functionality and attitude.

The middle class devotes the way the poor do. They spend their
incomes and extras on more stuff that will not return a profit to them.
While rich people recognize that money comes to them by providing
products or facilities that people want to buy.
For most people, the reason they dont win financially is because the
fear of losing money is far-off greater than the happiness of being rich.

6- How to build the personal wealth. What is


your view point?
Who are just starting a new venture, or are in transition, that You
can't form wealth if you don't save money, and you can not save
money if you do not know what you already have.
Rare things in life are permitted, and money is not frequently one
of them. In fact, money is so infrequently free that you really have
to grasp the proclamation by the horns when it comes along.
And people working as employee can get the space to achieve
anything because what they do is earn spend and pay taxes
which is not personal wealth they are just spending their lives. I
agree with author being rich is not being about just getting
money.
Your biggest problem to achieving wealth is often establish right
at home It's yourself and your partner. Too often, people live their
lives in a manner that is not conducive to creating real wealth ,
because we need to have a different mindset.
Increase financial knowledge because without it you cant excel
as it is necessary for you know about the money acting as a
business man. Furthermore starting business you need to identify
your resources because they define you which business mans top
priority on difference to person with different attitude.

7- How can money be just an idea?


Money is a opportunity , it guides you in towards your ultimate
idea. Money is always circulating, if you have an idea to solve
someones particular problem then he/she gratefully to give you
money for it. If you got clear attention, what you want then lack of
time , lack of money , lack of knowledge and the fear may get in
you way.
Theres a very common pattern that comes with working towards
ideas that were all aware that you set your mind to something,
you get excited and then drive starts to fade. Having ideas that
you can focus on and visualize helps you better connect yourself
with your inner wants, and gives you the motivational energy you
need to work through periods where your focus certainly starts to
decline.