robert-kiyosaki-cashflow-101-boardgame

My Rich Dad Poor Dad Book Review and Cashflow 101 Experience

I first tried to read the Rich Dad Poor Dad ebook version a few years ago, but there was so much controversy around it I wondered if it had anything worthwhile to say.

Then I attended the National Achievers Congress in 2015 where I met Robert Kiyosaki in person and heard him talk about his popular and bestselling book, Rich Dad Poor Dad, and his investment strategies.

I considered a re-read a few times, but for some reason I couldn’t finish reading it. Maybe because I was bothered by these controversies:

  • That there was no rich dad — it’s a fictional account being presented as fact.
  • That the author, Robert Kiyosaki, is a fraud/cheat/swindler/you-name-it.

While there are many critics of the book, there’s also no doubt the book has been a massive success. Robert Kiyosaki and the book have received support from Oprah Winfrey, Will Smith, Donald Trump, and more.

Then pandemic came and I started reading self-help books. Many authors and successful people recommended the Rich Dad Poor Dad, so I thought, “I need to go back and read that book.”

And that’s what I did. I bought a hard copy of the Rich Dad Poor Dad from National Book Store and it was the first book I read this year.

Here are some of the lessons I learned from the book…

Lesson 1: The poor and middle class work for money. The rich have money work for them.

Buying or building assets that deliver cash flow is putting your money to work for you. High-paying jobs mean two things: you’re working for money and the taxes you pay will probably increase. I’ve learned to put my money to work for me and enjoy the tax benefits of generating income that doesn’t come from a paycheck.

What a valuable concept! I wish I had learned this when I read the book the first time. If a young person can read these ideas, internalize them, and take action, they can become quite wealthy at a relatively young age.

Lesson 2: It’s not how much money you make. It’s how much money you keep.

You must know the difference between an asset and a liability, and buy assets. If you want to be rich, this is all you need to know. It is rule number one. It is the only rule.

Robert Kiyosaki defines assets and liabilities as follows:

An asset puts money in my pocket. A liability takes money out of my pocket.

He does focus much of the book on assets that literally “put money in his pocket” including income producing assets like real estate.

Then later in the book he clarifies these are fine by including the following in a list of real assets:

Anything that has value, produces income or appreciates, and has a ready market.

He lists a personal residence as a liability, not an asset, because it has many associated costs with it.

Lesson 3: The rich focus on their asset columns while everyone else focuses on their income statements.

Keep your daytime job, but start buying real assets, not liabilities or personal effects that have no real value once you get them home. Keep expenses low, reduce liabilities, and diligently build a base of solid assets.

I think Kiyosaki gets an anti-job label from some that’s not deserved. It’s not that he says to abandon your career, he just advocates using career income for the right purposes, to invest in assets and not spend it all on consumer products.

He’s also very adamant about keeping expenses low, which is something I like. If you can earn a lot and spend little, you can create a huge gap that will fund a boatload of investing — which will make you wealthy.

Kiyosaki doesn’t follow the traditional definition of net worth, but defines wealth this way:

Wealth is a person’s ability to survive so many number of days forward — or, if I stopped working today, how long could I survive?

Unlike net worth — which is the difference between your assets and liabilities, and is often filled with a person’s expensive junk and opinions of what things are worth — this definition creates the possibility for developing a truly accurate measurement. I could now measure and know where I was in terms of my goal to become financially independent.

Lesson 4: Corporations are the biggest secret of the rich.

A corporation can do many things that an employee cannot, like pay expenses before paying taxes.

The basic gist is that taxes kill most people and by forming corporations you can reduce taxes.

This maybe true, but you also have to do some things that could be considered shady like “have board meetings in Hawaii” (to effectively move personal expenses — which are paid with after-tax money — to corporate expenses which are paid before taxes.)

It seems a bit scammy to me even if it may be technically correct and allowed by law.

Personally, I prefer his other advice for lowering taxes (later in the book): work to reduce earned income (which is taxed at the highest rates) and increase investment income (which can either deduct expenses before being taxed or is taxed at lower, capital gains rates). This seems like a better way to lower taxes.

Lesson 5: Often in the real world, it’s not the smart who get ahead but the bold.

Once we leave school, most of us know that it is not so much a matter of college degrees or good grades that count. In the real world outside of academics, something more than just grades is required. I have heard it called many things; guts, chutzpah, balls, audacity, bravado, cunning, daring, tenacity, and brilliance. This factor, whatever it is labeled, ultimately decides one’s future much more than school grades do.

I agree 100%.

One example of the sort Kiyosaki is talking about who you might not initially think fits the bill is Warren Buffett.

Sure he’s patient, deliberate, and thoughtful but he also has guts (he invests billions at a time and takes big stakes in his investments)! And most would certainly say he is brilliant.

Of course, there are few Warren Buffett’s but the good news is that none of us need to be that stellar. If we simply push forward a bit here and there, small progress will add up and make us wealthy.

Many people limit their financial results simply because they lack the fortitude to take action. One example is growing career income.

It’s clear your career is vital to financial success. But most people can’t/won’t make a few, small steps to grow their careers. So they are left behind while others forge ahead.

Lesson 6: Job security meant everything to my educated dad. Learning meant everything to my rich dad.

I recommend to young people to seek work for what they will learn, more than what they will earn. Look down the road at what skills they want to acquire before choosing a specific profession and before getting trapped in the Rat Race.

Kiyosaki talks about a “synergy of skills” and he recommends learning new skills through work experience as well as outside education with books, seminars, and so forth.

We’ve noted that 1) continuing to learn and develop is vital to income growth, 2) layering skill upon skill makes an employee much more valuable, and 3) some skills are more valuable than others. Why not work to develop these?

I wish I had intentionally focused more on developing skills during my working years. I did develop some, but they were mostly learned by chance. Kiyosaki is recommending developing skills on purpose, something that’s extremely hard to disagree with.

Is this book worth reading?

From the above you can see that the book’s main content is quite good. So, it’s definitely a YES for me!

Let me summarize it all with a few reasons I think the book is worth reading:

1. It offers a contrarian point of view.

Much of what Kiyosaki says is contrary to “common knowledge” in the personal finance world. This is what I like about the book — it looks at things from a unique perspective.

This is probably why Kiyosaki gets so much hate. When you say personal residences aren’t assets, income isn’t as important as assets, and so forth, people tend to get upset (especially those with big houses, high incomes, and few assets!)

He’s also very much a “pull yourself up” sort of guy which angers those who would rather sit around and make excuses for their lack of wealth (while taking zero action).

I like reading different/unique perspectives, especially when they are explained in logical ways and backed up with solid financial principles like keeping expenses low.

2. It focuses on turning earned income into income-producing assets.

I like this! What else could anyone conclude when I suggest earning as much as you can in a good way, saving it, and investing it? The process is designed to turn earnings into investments and thus make people wealthy.

So this is an absolute winning point.

3. It advocates controlling spending/expenses.

Earn, budget, give, save, and invest.

Again, very good and needed advice.

4. It pushes investing, especially in real estate.

I haven’t started investing in real estate yet, but this book inspired me to know more about real estate investments.

5. It talks about the power of the mind and continual learning.

Learning is not only great for your career but also for your finances and life.

I love going to seminars. Even when I was still working in the corporate world, I would set aside a portion of my income for seminars and workshops. I’m also grateful that I got the opportunity to become an events coordinator and Chief Operating Officer of an events company that allowed me to attend more seminars and workshops including the National Achievers Congress where Robert Kiyosaki was one of the speakers.

I loved it and still learn a lot today, mostly by watching motivational videos on YouTube and listening to podcasts and audio books while exercising. I also invest in online courses that are mostly related to self-development, personal finance, and online business.

6. It emphasizes action.

In fact, very close to the end Kiyosaki says:

Action always beats inaction.

He’s a do-er himself and recommends it for others. I do as well.

We’ve all met those who can talk a great game but when it comes to results they have put no points on the board — because they don’t do anything.

They talk a lot but never attack their goals.

Thus they doom themselves to a life of mediocrity.

It’s much better to take action. Even if you fail you’ve learned something to make you better for the next attack.

Anyway, those are my thoughts on the book. I’ve also read his other book with Donald Trump, Midas Touch, and I’m also planning to purchase two other books by Kiyosaki, Why the Rich Are Getting Richer and Rich Dad’s CASHFLOW Quadrant as they both seem like they could be worth the read.

Final Take

So what are your thoughts on this book? Do you like the content (maybe in spite of the author)?

Or do you think the author is a quack and even if the advice is good, he can’t be trusted and shouldn’t be read?

I’m interested in what you have to say, so leave your thoughts in the comments below.

Btw, let me also share with you my experience when I attended the Cashflow 101 board game seminar.

robert kiyosaki

Cashflow 101 (Second Time)

Blog post dated November 21, 2015

I attended the Cashflow 101 board game / workshop two weeks ago at the Crown Plaza Hotel in Ortigas, Pasig City. This was my second time to play this board game. The first time I attended Cashflow 101 was early in 2012.

Few days prior to this event, I met the organizers of the Rich Dad, Poor Dad events here in the Philippines, the smart and lovely ladies from Laurus Enterprises – Joana, Paula, and Jev. 🙂

During that meeting, we talked about the upcoming ‘Masters of Wealth’ Business Conference with Robert Kiyosaki and 7 other International Speakers. They also mentioned that they will be holding the Cashflow 101 board game in November, few days before the big event.

I told them that I attended that same board game in the past and I’d love to attend Cashflow 101 again.

I was surprised to know that Laurus Enterprises is the exclusive organizer of Cashflow 101 workshops and Rich Dad activities in the Philippines and has been the official partner of Rich Dad Training (S.E.A.) Pte. Ltd. since January 2005. Unfortunately, the one that I attended in 2012 wasn’t organized by Laurus because they said that they don’t hold their events in a restaurant.

Hmmm, I wonder who the organizers were on that first Cashflow 101 board game that I attended…

Anyway, I told them that I was really interested to attend their Cashflow 101 event and it was so sweet of them to have given me 2 complimentary seats for me and my friend, Shyne.

WHAT IS CASHFLOW 101

For those who are not familiar with this game, Cashflow101® is a board game created by Robert Kiyosaki, author of the Best-Selling book, Rich Dad Poor Dad, to serve as a bridge from learning the Rich Dad concepts from the books towards applying those concepts in a safe environment first (no real money is involved in the board game, this serves as a practice ground). It is only through practice that the firm foundation of financial literacy is formed. (Source)

Cashflow 101 is a half-day event that will give participants an overview and hands-on understanding on what makes rich people richer and poor people poorer.

The main goal of this game is to get out of the Rat Race and onto the Fast Track by building up your Passive Income to be greater than your Total Expenses.

AT THE CASHFLOW 101 EVENT

The event was facilitated by Jerome San, the only person in the Philippines that has been personally trained by Mr. Bellum Tan, the CEO of Rich Dad Training S.E.A. Pte. Ltd. And he is also the CEO of Laurus Enterprises.

Jerome San shared the principles of the Rich Dad, Poor Dad by Robert Kiyosaki before, during, and after the Cashflow 101 board game.

There were around 200 participants of the Cashflow 101 event on November 8, 2015, and one moderator was assigned in each table with 8-10 participants. Paula Lopez was the one assigned to us at Table 8. 🙂

cashflow 101-boardgame-jerome-san

My Key Takeaways from the Cashflow 101 board game and workshop:

  1. Focus on building and acquiring assets rather than liabilities.

Assets – are things or properties that will continue to work for you and provide you income whether you work or not.

Is buying a car an asset or a liability?

Answer: It depends… Will it provide you income whether you work or not?

  1. Build more passive income than active income and expenses. This will prepare you for your financial freedom.
  2. People don’t get started because they focus on the lack of capital, time, and know-how.

What to do?

Know what you have now – your resources, knowledge, skills, talents…

You might have what you need to get started. And along the way, the journey will provide what you need.

  1. Start small, think big. Start small, start now!

A lot of people always think of becoming rich right away. They want to have a huge business and lots of assets. But we should always remember, that it takes big to have big. Learn how to start small, but have a big goal in mind.

  1. If you’re employed, you work hard for money. If you have a business, your money work for you.
  2. If you’re building a career, make sure you’re building YOUR assets, and NOT someone else’s assets. (My favorite of all and also a wake-up call for myself)
  3. Use debt as a leverage to take advantage of opportunities.
  4. Take risks. Learning doesn’t only happen in school but also when you take risks. The greatest risk is NOT to take the risk at all.
  5. Every opportunity comes from a problem. Don’t be afraid when you encounter a problem for every crisis comes an opportunity.
  6. Solve small problems, get small profit. Solve big problems, get big profit.

Problem solving is a skill. The good thing is, skill can be acquired.

  1. Always play above the line. You’ll see your greatness if you see yourself above the line. Everyone is given different sets of potentials and skills. Our task is to enhance and maximize our skills to come up with something greater.
  2. Knowledge is not power. Knowledge is power with ACTION!

(Just a disclaimer, this list is only based on what I remember from the event and may not necessarily mean that these are the exact words or principles of the Cashflow 101 or Rich Dad, Poor Dad training.)

Even if I already attended the Cashflow 101 game before and I already had an idea how it was played, I was still very excited to play it again. And I wasn’t disappointed. I enjoyed every bit of the game. I learned a lot and I had so much fun. I was also one of the few lucky participants who finished the game with higher passive income than expenses, which is one of the main goals of this board game.

My challenge now is to apply the principles I learned from the Cashflow 101 event and to start working on building my passive income and acquiring assets over liabilities.

I know it’s easier said than done but I’ll do my best to follow these principles in real life.

Robert-Kiyosaki-LIVE-in-Manila

Cashflow 101 (First Time)

Blog post dated April 26, 2014

Investing in the stock market is not completely new to me. I first heard about it two years ago (2012) when I found an item on Metrodeal about a seminar-workshop on investing.

It’s called the Cashflow 101 and after checking all the details, I bought it online and attended the half-day event at Spicy Fingers, Greenbelt 2 Ayala Center, Makati City.

As far as I remember, it started with a short topic about investing and what makes rich people richer and poor people poorer. I forgot the name of the speaker but after his short talk, the Cashflow 101 board game followed.

I really had no idea what the workshop would be like before I went to the venue and I was surprised when I found out that it was literally a board game. I’ve never played it before but my thought that time was that this was similar to the millionaire’s game. No real money was involved, only play money.

During the game, we were given same amount of cash (play money) and we simulated investing in stock market, buying properties, putting up businesses, and spending for our personal needs and wants. Whoever gets the highest amount of assets and fewer liabilities at the end of the game will be the winner, which meant that he was able to manage his funds properly and earned substantial returns.

The P340 fee that I spent for this event was really worth it. Not only did I enjoy the board game but also the delicious lunch that they served. More than that, I learned new things about taking control of my personal finances, proper cash flow management, and how to earn passive income. One thing that caught my interest was investing in the stock market which I had no idea on how to do it. All I knew when I heard about stock market back then was that it was only for the rich people and the businessmen.

One of my co-participants in that event encouraged me to invest in the stock market and she referred me to the Philippine Stock Exchange website for more info. I did check it when I got home but I didn’t really understand what stock market was all about even after reading some resources.

I totally forgot about the cashflow101 workshop and stock market investing until after two years when I resigned from work and became a stay-at-home mom. Now, I’m so happy that I have started investing in the stock market and I’m so excited to play the real game of cashflow management and investing.

Leave a Comment

Your email address will not be published. Required fields are marked *

%d bloggers like this: