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Best book for learning Personal Finance

By Manjit Kishore VermaPublished 3 years ago 4 min read
Rich Dad Poor Dad

The book “Rich Dad Poor Dad” comes with tons of knowledge in terms of Personal Finance. Although it’s all about the reader to get them all. The book was written and published back in 1997 and has sold about 32 million copies in 40 different languages worldwide.

Personal finance is one of the most important art one should know. This art will enable you to increase your return with low investments. The book teaches all the different aspects of personal finance. It teaches that how a middle-class person invests their money and their differences from a rich person.

Here are some of the most noticeable lessons you can get from “Rich Dad Poor Dad”. Let’s get straight into them.

Lesson 1: Rich acquire Assets, Poor acquire liabilities and think it’s an asset.

The core of the book says that those people who are rich will always remain rich and the poor people will remain poor until they don’t change their pattern of spending.

But the question is how it’s going to change? And what would be the impact of it?

This book further states that the rich acquire assets and the poor always acquire liabilities and think it’s an asset. I know it sounds confusing. Let’s understand it.

The poor people are those who think that their car, their home their day-to-day goods are their assets. But here is the difference come, The rich people invest their money into something which can generate income even if they are not working upon them. Like Stock, Bond, Patient Right and there are many different things.

Lesson 2: Rich don’t work for money, money work for them

Most people are always indulging themselves in marsh thinking their job will secure their life. But the reality is quite different from what it seems to be.

A very famous line said by Warren Buffett if your salary is your only source of income, you're one step away from poverty.

The book says that rich people always utilize their money in building their asset column more effectively by investing their money in stocks, bonds, businesses that will earn a profit, patient rights even more.

The aim of the investment is that rich people don’t have to work hard in their jobs. They can earn enough money by investing only whereas the poor people who don’t have any strong investment will work for money instead of money work for them.

Lesson 3: Mind your own business

The Rich Dad Poor Dad is one of the best books if you want to learn about start-up, it must be your first book while learning personal finance. Many times the author has said in the book that the more you’ll work for the firm, the more you’ll be charged for your paycheck.

If you think that a rise in your salary can save you for the long term, it won’t. Because if your salary will increase it will lead to increase in expenses as well.

Kevin O’Leary says that “A Salary is a Drug They Give You to Forget Your Dreams”.

Robert says in the book that “The moment you’ll see an opportunity, you will see them for the rest of your life”.

Which mean you must do a job but that should not be your only source of livelihood. You should have more options available every time. You can make your start-up, and mind your own business even if you’re doing the job. Always remember “Intelligent are those who hire people more intelligent than them”

Lesson 4: Salary is a short term solution for long term problems

Robert T.Kiyosaki, says that salary acts as a carrot in front of a donkey pulling a cart which is guided by the rider over the cart. The rider used the carrot to make their path successful and the donkey thought that I’ll get a carrot that will full fill my requirements.

However, if the donkey can see the full image, the situation may differ.

Similarly, salary fulfills your short-term requirements but doesn’t give you the freedom of spending.

People are trapped between their fear of losing money and the greed of gaining some raise. Most people want to get higher pay but they never think that “Is there another way?” again the same theory comes in. The moment you’ll see an opportunity, you’ll see them for the rest of your life.

So the best solution is to explore different ways of income.

Lesson 5: A raise can't be considered gain.

This book has taught me that if you’re working so hard to get a hike in your salary, You’ll remain poor. Again, salary is a short-term solution for a long-term problem.

This book further says that if you’ll be successful while getting a raise in your salary. The government will take over it and again you’ll be left with nothing.

In the end, it’s not about how much you make, it’s about how much you keep. So try to build your own company so that you can easily minimize your tax. Furthermore, it will enable you to the freedom of spending.

There is a difference between the spending style of business owners

Owners first earn then spend then pay taxes but a middle class or poor people first earn then pay taxes and then spend.

I went through this book and I have received lots of ideas about making my career more stable and retiring early. I often recommend this book to everyone who is struggling with their finances and the same I’m doing with you people.

There are possibilities that I will write many blogs on this topic again.

Stay tuned,

Manjit Kishore Verma

For further query mail at [email protected]

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About the Creator

Manjit Kishore Verma

Pursuing Bachelor's in Journalism and Mass Communication from Galgotias University | Freelancing | Content Writer | Blogger

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