Financial Literacy: An Underrated Knowledge
“People learn to work for money…but never learn to have money work for them.”
Or is it the other way around.
It is baffling to realize, but Mr. Kiyosaki, you are right. We all are in a Rat race. Didn’t understand ??
Follow with me as I hail, the most uncomplicated methodology to finance, Rich Dad, Poor Dad, written by Robert T. Kiyosaki.
So, Robert entails the story of two Dads, Rich Dad and Poor Dad. Though divided financially, both have had an impact on his life, especially Rich Dad, as most decisions made, are keeping him in mind.
To own a big house and car, like Mikes's family (friend), he requests Mike to ask his Dad to teach him how to be rich.
The next day both Mike and Robert are put to work, by Rich dad, on one condition, that they were to listen and understand the lessons, and here on using them.
Rich dad gives importance to financial literacy, which he believes is lacking in everyone. The description given by most parents, of higher grades meaning better money, was nonsense to him. Rich dad, says to the two boys, all are in a rat race, the cycle of giving and take, where adults are continuously sweat blood and tears, yet are left with minimal income, even their extra earning are lost. The thought of working harder for better pay is a common mentality, “work for the money”.
Poor dad is a part of the race, as Robert realizes, he suggests to him what was a warning from Rich dad, the Rat race.
Getting to the content, the book is divided into lessons, each explained by Robert with examples and diagrams crafted for understanding economic terms. Making a note here: he doesn't force you anywhere for the need to change your course of a career or to become money-minded. The idea is to be self-dependent, know how the system works, what can be done with the money.
The lessons are as follow:
THE RICH DON'T WORK FOR MONEY -
Money isn't linked with fear for the rich, they are free from the race, they know where to put money, understand their expenses and liabilities, and take action, so are bound to remain rich. The ones in the Rat Race, remain so unless they don't grow out of the fear, of losing money.
WHY TEACH FINANCIAL LITERACY ? -
We are taught, better grades=better college= better income= better life. We’re so dumb. Money does grow on trees. We just need to know how to extract it. It’s the lack of commercial knowledge, the aspects of the money movement, we have the least idea about. This hits us after our 50s, or later, on the reckoning of lesser assets on hand.
MIND YOUR OWN BUSINESS -
(Literally, don't have to explain further)
HISTORY OF TAXES AND THE POWER OF CORPORATIONS-
Why do we have taxes, why do the rich stay rich, and the poor remain poor. The quick history and reasons for taxing are mentioned. A bit of flashback can clear thoughts, to understand cash flow.
THE RICH INVENT MONEY-
Money is an illusion, it is the sand slipping from your hands. Fools hold on to it. It's the fear. The clever know commercial investment, they create an income source and don't run behind it.
WORK TO LEARN-DON'T WORK FOR MONEY-
Whatever we do, is a learning process, whether you're a mechanic, a doctor, or just want to earn some money the basics are the backbone. Don't hesitate to learn, or give up if it takes time. You need to learn to make money work for you.
BEGINNINGS- OVERCOMING OBSTACLES
Robert elaborates restrictions- fear, laziness, cynism, arrogance, and bad habits. These persist, in each and every one. To recognize and overcome them are a step closer to financial success. Not meaning that you will become super-rich. But, you have the time for yourself, mindfulness to focus on what you can do, you can take risks, to know what you get back, not just your income, but your assets.
The last 36 pages ( before the epilogue) are your personal guide to getting on with accounting and investing. Knowing your “time and interests”.
The gist given is too little, to make you understand, how important it is to notice where your money goes, and how you can use it in your favor. The patience given to make you understand the idea of economics is worthy, and a must to read as early as possible to tackle future changes.
CONCLUSION
You have spent years in school and college, but what have you really learned about money. Do you think the money you earn and save, is really sufficient till retirement?
(After reading the books, having to notice how much money is spent unnecessarily will bang you in your head.)
Robert is the push you need to get a hold over the fear of losing money or to play safe. He wants to make the public aware of the meaning “business” “assets”, which appears we all probably hear and run away from. The need for saving is basic, but are you willing to challenge your ideas regarding money??
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