Rich Dad Poor Dad: Review & Summary
“Most of us know that is not much a matter of college degrees or good grades that counts in the real world outside of academics, something more than grade is required: GUTS, BALLS, AUDACITY, TENACITY, BRILLIANCE.”
First Impressions
Rich Dad Poor Dad is a fascinating and thought-provoking introduction to financial literacy. Through the lens of two father figures—the author's well-educated but financially struggling biological father ("Poor Dad") and his friend's less formally educated but financially successful father ("Rich Dad")—Kiyosaki explores contrasting approaches to money, education, and wealth-building. Written in an engaging and provocative style, the book simplifies complex concepts with practical lessons, personal anecdotes, and actionable reflections.
Each of the book’s nine lessons is designed to challenge conventional wisdom about money. At the end of every chapter, Kiyosaki includes summaries and thought exercises to encourage readers to critically reflect and apply these ideas to their own financial habits and beliefs.
Key Takeaways from Each Lesson
Lesson 1: The Rich Don’t Work for Money
This chapter challenges the idea that a traditional 9-to-5 job is the only path to financial security. Kiyosaki emphasizes that the wealthy make their money work for them, whereas many of us work for money—and, in doing so, make others (employers and governments) richer. A major shift in mindset is required to recognize that reliance on a paycheck limits financial growth.
My Thoughts: This resonated deeply with me, especially the idea of shifting from emotional reactions to intentional, value-based decision-making. The “cone of learning” approach—doing > studying—encouraged me to think about experiential ways to apply these lessons.
Cone of Learning by Jeffrey Anderson - http://www.edutechie.ws/2007/10/09/cone-of-experience-media/, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=37711912
Lesson 2: It’s Not How Much Money You Make, but How Much You Keep
Kiyosaki introduces two essential definitions:
Assets: Things that put money in your pocket.
Liabilities: Things that take money out.
By focusing on acquiring assets and reducing liabilities, the goal becomes financial independence rather than income dependency.
Another important definition is not about how rich you are, but how wealthy you are.
Wealth: How many days can I survive without working?
So, the first goal is to have the cashflow from your assets cover your expenses (rent, groceries, etc.). The next goal is to have extra cashflow to be reinvested into the assets.
My Reflection: The question, “Is your house an asset or a liability?” made me rethink traditional notions of wealth. I also started evaluating whether my efforts were truly benefiting me or simply enriching others. For example, should I take extra shifts at work, invest that time in learning a new skill, or create something of value?
Lesson 3: Mind Your Own Business
Your job isn’t your business—your assets are.
While your profession generates income, your “business” builds wealth by growing assets. This chapter made me question whether I’ve been working hard to mind someone else’s business while neglecting my own.
Actionable Insight: This inspired me to explore asset-building ideas, like intellectual property (IP) or passive income streams. During my doctorate, I was lucky enough that as a TUM PhD student, I could take two courses from the European Patent Office (epo.org) on IP and how to bring ideas to market (see certificate below).
Lesson 4: Taxes and Corporations
Kiyosaki explains how the rich leverage corporations to minimize taxes and protect their wealth. The idea of “earning, spending, and then paying taxes” through a corporation contrasts sharply with the typical employee model of “earning, paying taxes, and then spending.”
My Perspective: This reinforced the importance of financial education—not only about investments but also about legal and tax strategies.
Lesson 5: The Rich Invent Money
In today’s information age, wealth is increasingly generated by ideas and agreements rather than tangible resources. This lesson emphasizes creativity, courage, and the power of leveraging one’s mind.
The most powerful asset we have is our mind. Therefore, you must do two things:
1. Invest in your financial education.
1. Accounting = ability to read numbers.
2. Investing = science of money making money.
3. Understanding markets = science of supply and demand.
4. The law = awareness of accounting corporate, state, and federal regulations.
2. Invest in stocks / real estate / other markets.
My Takeaway: The phrase “Money is not real; it’s what we agree it is” shifted my perspective entirely. It encouraged me to see opportunities where I might have previously seen limitations.
Lesson 6: Work to Learn—Don’t Work for Money
Kiyosaki advises prioritizing learning over earning, particularly in the early stages of one’s career. By acquiring diverse skills—especially in communication, sales, and management—one can become more adaptable and less reliant on a single income source.
LEARN>>>EARN
My Reflection: This chapter hit home. I’ve personally experienced the value of learning through volunteering and stepping out of my comfort zone as the co-founder and secretary of a volunteer organization of young water professionals under the International Water Association (ywpitaly.org). It also reinforced my belief that specialization can sometimes be a trap. You want to know a little about a lot. The more specialized you become, the more you are trapped and dependent on that specialty.
The skill you need the most is the ability to sell—to communicate. Thus, invest in your writing, speaking, and negotiation abilities.
The main reason people are not happy at their jobs is the salary. And it’s because of a wrong focus. People focus on job security while they should focus on learning. If you are not learning anything, it is time to change.
You don’t know where to start? Then, start volunteering. That’s how you get experience.
Lesson 7: Overcoming Obstacles
Fear, cynicism, and doubt are the biggest barriers to financial success. Kiyosaki encourages focusing on opportunities instead of limitations and adopting a mindset of curiosity and determination.
Favorite Insight: The question “How can I afford this?” has a transformative effect. It pushes us to think creatively rather than shutting down possibilities.
Lesson 8: Getting Started
The final lesson emphasizes the importance of taking action. Kiyosaki suggests starting small, learning from failures, and continuously investing in one’s education.
My Takeaway: The phrase “You become what you study” stood out. It’s a powerful reminder that every choice we make—whether it’s a book we read or a skill we learn—shapes our future.
What I Loved
The simplicity and practicality of Kiyosaki’s ideas are remarkable. Concepts like financial independence, asset-building, and self-discipline are broken down in a way that’s accessible even to beginners. The inclusion of reflective exercises made this more than just a book; it felt like a workshop on personal finance.
Criticisms
While the book is motivational, some advice can feel overly simplistic or not universally applicable. For instance, due to circumstances or risk tolerance, creating businesses or acquiring assets might not be feasible for everyone. Additionally, there’s a lack of concrete examples for implementing these lessons in today’s economy.
Final Thoughts
Rich Dad Poor Dad is an excellent starting point for anyone looking to improve their financial literacy. It’s less about offering a step-by-step guide and more about challenging preconceived notions about money, work, and wealth. For me, this book ignited a curiosity about personal finance and inspired me to take more control over my financial future.
If you’re ready to rethink your relationship with money, this book is worth the read.
