Just Finished Kiyosaki's Guide to Investing

Image via Wikipedia

Having just finished reading Kiyosaki's third book Rich Dad's Guide to Investing: What the Rich Invest in, that the Poor and Middle Class Do Not, I thought that I'd share my thoughts on what I learned and thought of the book.


First off, this book was a bit more difficult to read that the first two. It is 400 pages, the first 250 of which are fairly redundant, general (not that I didn't learn anything, but it was a little on the boring side). The first half of the book primarily deals with teaching the mindset of successful and unsuccessful investors (attitudes and habits that help or hinder). It wasn't until the last 150 pages that the book really picked up for me and I was able to learn a lot and get excited about learning more. This last part of the book goes over what successful investors actually do. Some stories are given, diagrams presented, and facts thrown at you. Now keep in mind that these books by Kiyosaki still deal in generalities, so to find more in-depth information about investing you can read the Rich Dad Advisor books, and books by other people (I'll supply the list I came up with while reading in another post).



So, with that said...here are some things that I found interesting:

• Five phases to investing and becoming wealthy. Phase 1 = Being mentally prepared to be an investor. Phase 2 = Deciding what type of investor you want to be. Phase 3 = How to built a strong business. Phase 4 = Becoming a sophisticated investor. Phase 5 = Giving back to society.


• In order to get into the top 10% of money making deals you must, at least, be considered an accredited investor. In order to qualify as an accredited investor you must: make at least $200,000 in annual income or over $300,000 as a couple, or have at least 1 million dollars in net worth.


• Investing is not trading, buying, and selling. "Investing is a plan, often dull, boring, and almost mechanical process of getting rich." If the formula (plan) is too complex; it is not worth following. If you can't do it automatically after you learn it, you shouldn't follow it. Follow a formula that will make you rich, and follow it!


• Before really delving into the investment world, you must first set up a plan for both financial security and comfort. Meet with and interview financial planners until you find one you like; then make a plan. After that is done, work on converting earned income into portfolio &/or passive income as efficiently as possible.


• Investing isn't risky, investors are.


• After accredited investor comes a qualified investor, then sophisticated and finally inside and ultimate investors. Accredited investors have excessive cash, that's it. Qualified investors have excessive cash and education. Sophisticated investors have excessive cash, education, and experience. The last two have all three but are on the inside of investments (making the deals that others buy, or selling the stock and taking companies public).


• There is magic in making mistakes: Levi Strauss (didn't strike it rich with the 49'ers, but created Levis Jeans), Christopher Columbus (didn't discover a new trade route to the Indes, but found America), Thomas Edison (failed over 100 times before invented the light bulb), Warren Buffet (bought Berkshire Hathaway, the company initially failed, but he built it up again). "When you come to the boundaries of what you know, it's time to make some mistakes." "Success is the ability to go from one failure to another with no loss of Enthusiasm. " (Winston Churchill)


• Five D's to becoming rich: Dream, Dedication, Drive, Data, Dollars. "In reality, it is the focus on the first 3 D's that ultimately gain you the data and dollars you need to become very, very rich. In other words, the data and the dollars are derived from having a dream, being dedicated, and having the drive to win."


• The 90/10 riddle (why 90% of the money is controlled by 10% of the people). The 10% create assets out of ideas and buy other people's assets (mutual funds, etc.). They are both a creator and buyer of assets; they create enough to pay for the buying.


• The B-I Triangle (your team): business owner, employees, specialists, investors.

• The foundation for a good business. First must have good team, strong spiritual and business mission, and excellent leadership. Then understanding and management of cash flow, communications, business systems, legal representation, and lastly product. If one part is weak, the company will crumble.

• Check out http://www.richdadgold.com/


• Check out http://www.richdadbook3.com/, http://www.richdadbook1.com/, http://www.richdadbook2.com/


• "A person's financial reality will not change until he or she is willing to go beyond the fears & doubts of his or her own self-imposed limits."


• Must have a plan to not only acquire wealth, but what to do when you have too much of it.


• Ideas & Knowledge=money

These are some of the main key points that I learned from reading Kiyosaki's Guide to Investing. There are many other things that I learned which I will share in later posts since they require more in-depth writing and not just a single bullet point. For now, I found this information to be extremely helpful. It has helped me change my mind and attitude about what investing entails.

Related articles by Zemanta

• A Timeless Secret To Building Massive Wealth - The Slow Way! (wailoong.com)
• 3 Areas You Must Invest in During an Economic Recession (lifehack.org)
• Financial Strategies For Retirement Seminar (slideshare.net)
• Financial Planning vs Planning to be Financial (crystalsquest.com)