Excerpt from Rich Dad Poor dad - Chapter Eight (getting Started)

Chapter Eight

GETTING STARTED

There is gold everywhere.

Most people are not trained to see it.

It really is easy to find great deals.

It’s just like riding a bike. After a little wobbling, it’s a piece of cake.

The problem is that our financial genius lies asleep, waiting to be called upon.

If you don’t, make up your own. Your financial genius is smart enough to develop its own list.

The reason is that they have not taken the time to develop their financial genius.

I offer you the following 10 steps as a process to develop your God-given powers, powers over which only you have control.

1.    Find a reason greater than reality: the power of spirit

2.    Make daily choices: the power of choice

3.    Choose friends carefully: the power of association

4.    Master a formula and then learn a new one: the power of learning quickly

5.    Pay yourself first: the power of self-discipline

6.    Pay your brokers well: the power of good advice

7.    Be an Indian giver: the power of getting something for nothing

8.    Use assets to buy luxuries: the power of focus

9.    Choose heroes: the power of myth

10.                       Teach and you shall receive: the power of giving

Find a reason greater than reality: the power of spirit

When I asked her what fueled her super-human ambition and

sacrifice, she simply said, “I do it for myself and the people I love. It’s

love that gets me over the hurdles and sacrifices.”

Those are my deep-seated emotional reasons. What are yours? If they are not strong enough, then the reality of the road ahead may be greater than your reasons.

but it was the deep emotional reasons that kept me standing up

and going forward.

I’ve learned that, without a strong reason or purpose, anything in life is hard.

IF YOU DO NOT HAVE A STRONG REASON, THERE IS NO SENSE READING FURTHER. IT WILL SOUND LIKE TOO MUCH WORK.

Make daily choices: the power of choice

Choice is the main reason people want to live in a free country.

We want the power to choose.

Financially, with every dollar we get in our hands, we hold the power to choose our future: to be rich, poor, or middle class. Our spending habits reflect who we are.

My best friend, Mike, had an asset column handed to him, but he still had to choose to learn to keep it.

Many rich families lose their assets in the next generation simply because there was no one trained to be a good steward over their assets.

I just choose to be rich, and I make that choice every day.

Invest first in education. In reality, the only real asset you have is your mind, the most powerful tool we have dominion over. Each of us has the choice of what we put in our brain once we’re old enough. You can watch TV, read golf magazines, or go to ceramics class or a class on financial planning. You choose. Most people simply buy investments rather than first investing in learning about investing.

I love CDs and audio books. The reason: I can easily review what

I just heard. I was listening to an investor say something I completely

disagreed with. Instead of becoming arrogant and critical, I simply listened to that five-minute stretch at least 20 times, maybe more. But

suddenly, by keeping my mind open, I understood why he said what he

said. It was like magic. I felt like I had a window into the mind of one of

the greatest investors of our time. I gained tremendous insight into the

vast resources of his education and experience.

The net result: I still have the old way I used to think, and I now have a new way of looking at the same problem or situation. I have two ways to analyze a problem or trend, and that is priceless.

The only way I can access their vast mental power is to be humble enough to read or listen to what they have to say.

Arrogant or critical people are often people with low self-esteem who are afraid of taking risks.

If you have read this far, arrogance is not one of your problems.

Arrogant people rarely read or listen to experts. Why should they?

They are the center of the universe.

In this case, their so-called intelligence combined with arrogance equals ignorance.

Listening is more important than talking.

They argue instead of asking questions.

Choose friends carefully: the power of association

They often think it rude or unintellectual. So I also learn from my friends who struggle financially. I find out what not to do.

I would say that one of the hardest things about wealth-building is

to be true to yourself and to be willing to not go along with the crowd.

Wise investors buy an investment when it’s not

popular. They know their profits are made when they buy, not when

they sell.

The reason you want to have rich friends is because that is where the money is made.

I’m not saying do it illegally, but the sooner you know, the better your chances are for profits with minimal risk.

That is what friends are for. And that is financial intelligence.

Master a formula and then learn a new one: the power of learning quickly

In order to make bread, every baker follows a recipe, even if it’s only held in their head. The same is true for making money.

I say, “You become what you study.” In other words, be careful what you learn, because your mind is so powerful that you become what you put in your head. If you’re tired of what you’re doing, or you’re not making enough, it’s simply a case of changing the formula via which you make money.

Working hard for money is an old formula born in the day of cavemen.

Pay yourself first: the power of self-discipline

If you cannot get control of yourself, do not try to get rich. It

makes no sense to invest, make money, and blow it. It is the lack of

self-discipline that causes most lottery winners to go broke soon after

winning millions. It is the lack of self-discipline that causes people who

get a raise to immediately go out and buy a new car or take a cruise.

I would venture to say that personal self-discipline is the number-one delineating factor between the rich, the poor, and the middle class.

Simply put, people who have low self-esteem and low tolerance for financial pressure can never be rich.

Pay your brokers well: the power of good advice

And the more money they make, the more money I make.

Information is priceless. A good broker should provide you with information, as well as take the time to educate you.

Just be fair, and most of them will be fair to you.

The real skill is to manage and reward the people who are smarter than you in some technical area.

Be an Indian giver: the power of getting something for nothing

True, I have lost money on many occasions, but I only play with money I can afford to lose.

So wise investors must look at more than ROI. They look at the assets they get for free once they get their money back. That is financial intelligence.

Use assets to buy luxuries: the power of focus

Remember, the easy road often becomes hard, and the hard road often becomes easy.

Choose heroes: the power of myth

I pretended I was a famous baseball player. It’s one of the most powerful ways we learn, and we often lose that as adults. We lose our heroes.

Copying or emulating heroes is true power learning.

By having heroes, we tap into a tremendous source of raw genius.

Teach and you shall receive: the power of giving

“If you want something, you first need to give,”

And when it comes to money, love, happiness, sales, and contacts, all one needs to remember is to give first.

It is true that your world is only a mirror of you.

Excerpts from Rich Dad Poor Dad [Chapter Six]

LESSON 6: WORK TO LEARN— DON'T WORK FOR MONEY

Job security meant everything to my educated dad.
Learning meant everything to my rich dad.

He was speaking on
motivation, and I was speaking on “The Secrets of the Rich.”

It was this business consultant who gave me the phrase: “They
are one skill away from great wealth.”

What this phrase means is that most people need only to learn
and master one more skill and their income would jump exponentially.

I have mentioned before that financial intelligence is a synergy of
accounting, investing, marketing, and law. Combine those four
technical skills and making money with money is easier than most
people would believe. When it comes to money, the only skill most
people know is to work hard.

So
I chose a title that would get me on more TV and radio shows, simply
because I was willing to be controversial. Many people thought I was a
fruitcake, but the book sold and sold.

In school and in the workplace, the popular opinion is the idea of
specialization: that is, in order to make more money or get promoted,
you need to specialize.

“You want
to know a little about a lot” was his suggestion.
He wanted us to know a
little about every aspect of his empire.

While most of my classmates, including Mike, were partying at
their fraternity houses, I was studying trade, people, business styles, and
cultures in Japan, Taiwan, Thailand, Singapore, Hong Kong, Vietnam,
Korea, Tahiti, Samoa, and the Philippines. I was partying also, but it
was not in any frat house. I grew up rapidly.

I told him I wanted to learn to fly, but really
I wanted to learn to lead troops.

Rich dad explained to me that the
hardest part of running a company is managing people.

The reason so many talented people are poor is because they
focus on building a better hamburger and know little to nothing
about business systems.

The world is filled with talented poor people.

All too often, they’re poor or struggle financially or earn less than they are capable of, not  because of what they know, but because of what they do not know.

He
never understood that the more specialized you become, the more
you are trapped and dependent on that specialty.

The main management skills needed for success are:
1. Management of cash flow
2. Management of systems
3. Management of people

The most important specialized skills are sales and marketing.

The ability to sell—to communicate to another human being, be it
a customer, employee, boss, spouse, or child—is the base skill of
personal success.

Communication skills such as writing, speaking,
and negotiating are crucial to a life of success.

Rich dad encouraged Mike and me to know a little about a lot.

I know of no other skills to be more important than
selling and marketing.

The better you are at communicating, negotiating, and handling your fear of
rejection, the easier life is.

The more they gave, the more they received.