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15 Little Life Hacks

Book Review: Rich Dad, Poor Dad (this books irks me)

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I decided to start reviewing some books that I read. I’ll do books on personal finance, entrepreneurship, and whatever else I think is cool. (If you have books you like, let me know.) First off…

richdad.jpg
Rich Dad, Poor Dad: What The Rich Teach Their Kids About Money–That The Poor and Middle Class Do Not!

This book is like the kid you hated in high school, but he let you cheat off his test a couple of times so you kind of like him. I have grudging respect for this book, but every time someone raves about it, I usually just want to punch them in the face.

Rich Dad, Poor Dad is an absolute juggernaut of a book–it’s been on the bestseller lists for as long as I remember. I re-read this book yesterday. Man, there are some really great points, like how rich people make money work for them and how everyone else works for money. The first chapter is pure magic–read it. One of my favorite quotes is from his Rich Dad:

Most people never study the subject [money]. They go to work, get their paycheck, balance their checkbooks, and that’s it. On top of that, they wonder why they have money problems. Few realize that it’s their lack of financial education that is the problem.

He takes a dim view of people who blindly make decisions without stopping to ask themselves why:

A friend of mine in Hawaii is a great artist. He makes a sizable amount of money. One day his mother’s attorney called to tell him that she had left him $35,000. This is what was left of her estate after the attorney and the government took their shares. Immediately, he saw an opportunity to increase his business by using some of this money to advertise. Two months later, his first four-color, full-page ad appeared in an expensive magazine that targeted the very rich. The ad ran for three months. He received no replies from the ad, and all of his inheritance is now gone. He now wants to sue the magazine for misrepresentation.

This is a common case of someone who can build a beautiful hamburger, but knows little about business. When I asked him what he learned, his only reply was that “advertising salespeople are crooks.” I then asked if he would be willing to take a course in sales and a course in direct marketing. His reply, “I don’t have the time, and I don’t want to waste my money.”

The book does a fantastic job teaching how to think about work and money. Its early parts are some of the best I’ve read. But I don’t agree with the book’s focus on real estate, which is far too complicated for beginning investors, and the high-level advice with few actionable recommendations. Many people love this book for teaching them how they they’re supposed to think about money–but if you ask them what they’ve done to get there, in my experience, the people who rave about this book haven’t done much. Unfortunately, Rich Dad, Poor Dad doesn’t have many actionable suggestions. I’d recommend this book as an excellent way to challenge your thinking about work and money, but only if you combine it with other books that make tactical recommendations of financial issues. I’ll cover more books I love and hate later.

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48 Comments on "Book Review: Rich Dad, Poor Dad (this books irks me)"

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Brian Yamabe
Brian Yamabe
10 years 3 months ago
Here’s the obligatory Kiyosaki == huckster link: http://www.johntreed.com/Kiyosaki.html What I dislike about him is his use of language and generalites to manipulate. Things like “I read the stock market.” What does that mean? And “If you didn’t make a million dollars in the stock market in the 90’s you need to reevaluate how to pick stocks.” His tone implies that this was a piece of cake if you knew what you were doing. I don’t deny that some of his ideas are good, but there are many others who say the same things and you don’t have to sift out… Read more »
charley
charley
10 years 3 months ago
I agree that Kiyosaki is a good motivator and can get people to think about money in ways that they haven’t before. However, it should be noted that Kiyosaki’s message that is at once inspirational and incredibly vague is basically a formula for getting you to buy more of his stuff, which includes books, seminars, board games, etc. I do believe that the books have value, but they should be taken with a big grain of salt. The below link is an in-depth look at Kiyosaki’s claims of owning multiple corporations, having myriad investment properties, and making vast fortunes. While… Read more »
BA
BA
10 years 3 months ago
Good review. I am glad you didn’t bodyslam the book. Although the Rich Dad advice clearly does not hold your hand through making your first chunk of passive income, most critiques of this book lose all credibility with me because they can’t say “These techniques don’t work, I’ve tried them so I know.” More frequently, all I see them say is “These techniques are too vague/advanced/risky/expensive/hard/unrealistic for me to try.” Despite the claims of any author, I think every reasonable person could conclude that no honest money-making system is going to be really really easy. I think the real challenge… Read more »
Chris Campbell
10 years 3 months ago

Whatever you do, don’t buy his game. Rich dad is a decent read for someone who has never thought about money, but he doesn’t seem to have much substance in any of his books.

Rick
10 years 3 months ago

I think you created a perfect summation of what the book is supposed to do. It’s not supposed to tell you to buy some shares of GE every year, it goal is to get you thinking differently and move you in the direction of buying other books and reading more information. It’s creating a different mindset, not a different investment strategy.

Mike
10 years 3 months ago

I think the biggest problem with this book is it doesn’t tell people what to do. The first book I read when I got interested in personal finance was Automatic Millionaire, and that gives you steps to go out and do today in order to make money work for you. This book just says you should make money work for you, but it doesn’t tell you how.

mikshir
10 years 3 months ago
You put into words my EXACT feelings about this book. Only thing I’d like to add is that I purchased some followup books of his thinking that I could pick up some practical information that was lacking from the first book. I could not and therefore do not bother recommending them. Yes they did have some gems of wisdom and insight but not as much as the first and I was a bit disappointed; also because he does over-do the real estate angle. Looking at his site and all the followup material, I almost had this feeling that he’s turned… Read more »
Aaron Woodin
Aaron Woodin
10 years 3 months ago

I’ve noticed the more books people have in their “success” library, the less successful they are.

One of my least affluent, struggling clients has untold numbers of success books and seminars on nearly every recorded audio and visual format in existence.

And nearly all of my very affluent clients have no “success” or “financial advice” books on their shelves.

One or two good books with sound advice and inspiration should do it.

A little known title is “Millionaire’s handbook” by H. Peter R. Miller – filled to the brim with little gems of business/wealth advice and wisdom.

Sean Tierney
10 years 3 months ago

Ramit, good review, it echoes my own thoughts on this book. I recently purchased this book on a friend’s recommendation-> Dave Ramsey – Total money makeover

I have yet to read it but would love to hear your thoughts if you have any familiarity with it.

sean

Jennifer
Jennifer
10 years 3 months ago

Ramit, since you’re a guy who likes proof, I think you need to take a look at the comments this guy gets on yahoo, and then take a look at the net worth compilations of various internet bloggers. You’ll see nothing but complaints about this guy on yahoo and the Kiyosaki adherents with blogs usually have a net worth equal to that a of fourth grader’s toy fund.

http://neos-nest-egg.blogspot.com/2006/02/personal-finance-bloggers-net-worth_11.html

VC
VC
10 years 3 months ago

I have read the book. It has some good basic principles but not much beyond that. The book could have been half the size. It is over-rated. You’d learn more off this site!

James
10 years 3 months ago
I agree. The Rich Dad Poor Dad series is motivating, but they never give suggestions of what I can actually do. He always says that if you read one of his other books, or play the board game, you will understand. I have read every book in the series (I got them at the library), and nowhere does it give any specific information about what to do! This guy writes in his book that he is retired, but I see him doing daytime infomercials and PBS fundraisers. While the books do challenge my thinking and motivate me to be rich,… Read more »
cameron
cameron
10 years 3 months ago

Wow, the John T Reed site posted above is pretty damning. Unless what Mr. Reed is putting out is inaccurate, I have a hard time understanding how the truth could be “somewhere in the middle”.

I have often wondered if Kiyosaki could show any proof that anything in his books had made him money besides the books themselves.

I’m now thinking twice about recommending this book to several people that don’t know much about investing.

Dean
10 years 3 months ago

Well, I have to give my 2 cents. I believe this book is so popular is because it appeals to a wide audience. It doesn’t overwhelm people with technical jargon. In other words it concentrates on the inner being of what it take to be rich and for most people that is much more powerful than a technical book of “how to’s” and “to do’s”.

The proof is in the pudding,this book has no doubt created billions of dollars to the people who have read it just by shifted their paradigms about money.

cameron
cameron
10 years 3 months ago

>The proof is in the pudding,this
> book has no doubt created
> billions of dollars to the
> people who have read it just
> by shifted their paradigms
> about money.

Billions? Does anyone have any actual proof that anyone has made any significant money based on what they learned from these books? Or even based on the “inspiration” it gave them?

Wilson
10 years 3 months ago
Accurate review, Ramit. Most people, including myself, thought along the same lines… however, I’m a big Kiyosaki fan. I think any book is worthwhile if it even gives you one little gem of information, and I found that RD,PD did just that. As a result, I own the first 4 or so books in the series and am finishing ‘Retire Young, Retire Rich’. I agree with the above posters, in that if you’re looking for ‘how to get rich’ instructions, you won’t find specific step by step instructions in these books. However, as you mention, they do change your mindset… Read more »
Milind
10 years 3 months ago

A well-articulated review, Ramit. I agree completely.

K
10 years 3 months ago

I agree that it is good with general thinking but not with the nuts and bolts.
However, I challenge any book to come up with a nuts and bolts plan that works for everyone all the time.
Just not possible.
Personal finance is just that, personal.
But the Rich Dad books got me thinking and asking more questions.
That, in itself, is worth the price of admission.

Carlin
Carlin
10 years 3 months ago
I’ve never read his book, but I’ve read his column on Yahoo! Finance. And after reading that, I have no desire to read any book written by him. He talks about real estate this and real estate that. He knocks stocks constantly. Why? Recently it was because the dollar will fall and having paper assets is the road to ruin when that happens. You need tangible assets like real estate. Well Bob, if you’re buying US real estate, and the dollar goes to hell, what’s going to happen to the real estate and the income generated from them? Do your… Read more »
Curt
Curt
10 years 3 months ago

More of a comment on #8 than on the “fake book”. Personally, I believe that the #1 method to success is not books. It’s the statement “Just do it!”

example: You can read about the Amazon rainforest all you want, but it’s a VERY poor substitute for actually experiencing it.

Maria Palma
10 years 3 months ago
Ok, I hear everybody’s criticism of this book, but I have to say that it was a very inspirational book for me. Kiyosaki didn’t promise any step-by-steps in this book, which is fine – I wasn’t expecting him to do that. We can read all the books we want about becoming rich, but nothing is going to happen if we continue to have a negative attitude towards others who have made it. The way to make big money is this: TAKE ACTION. Read as much as you can and then TAKE ACTION. All wealthy people will tell you that real… Read more »
Anonymous
Anonymous
10 years 3 months ago
I went out and bought a copy of this book today, not based on the review but based on what is discussed in the link posted in 1 and 2. I wondered, “could it really be that bad”. I am only 81 pages in and I have to say whole-heartedly, YES, THIS IS A TERRIBLE BOOK on personal wealth. While it does have a few broad ideas that aren’t bad, it demonstrates either a lack of understanding of basic finance concepts on Kiyosaki’s part or a willful exploitation of other’s lack thereof. An excellent example from page 80: “Let’s say… Read more »
Kien
Kien
10 years 3 months ago
I think this is a fair assessment of the book. But if you think about it, he’s telling you exactly what he’s doing in the book. He says that Rich people find ways to get rich. What I see him doing is using this book as an advertisement for his many tools of income: Books, Internet, and Real Estate. I don’t think it’s a coincidence that the Fed keeps talking about booming Real Estate markets after Kiyosaki has sold millions of copies of his book. I think his long term plan is to off-load his real estate while the markets… Read more »
cameron
cameron
10 years 3 months ago

> His rhetoric reminds me of
> the “Amway” method which
> unfortunately includes
> brainwashing techniques. If
> you remember Amway
> used
> the pyramid model

Interestingly, Kiyosaki has been linked to the Amway organization by Reed (see link in 1 and 2). Interestingly, on p138, he suggests that people “[join] a network marketing company” to learn about selling. He does not name Amway directly, but they are one of the largest such organizations.

Network marketing, while not inherently bad, is often used by people wanting set up “legal pyramid schemes” as many have accused Amway of doing. (i.e. http://www.amquix.info/).

John Capetown
10 years 3 months ago
I have read several of his books. Only the first (Rich Dad, Poor Dad) is valuable. The rest are just the same ideas repeated again and again. However, Rich Dad / Poor Dad is quite good, in the sense that it teaches you to see everything you buy from an asset / liability point of view. Let’s take for example a car. You want a luxury car. But.. the luxury car has lower MPG, and has higher maintainance cost. So what you have bought, in fact, is a hole in your pocket which will keep leaking money from you. Now… Read more »
cellardoor
10 years 3 months ago
As an intro finance book that gets unmotivated or completely unskilled at personal finance newbies off their butts and into action — this isn’t grotesquely bad. But add in the actively bad advice that he includes and you’ve got a losing deal. I hope the newbies who read his book get motivated enough to be financially literate, but not motivated enough to do the “advanced” stuff that he advocates. Alternatively, I’m hoping that once the newbies understand the 10% of the book that’s useful as a personal finance intro, they’ll understand enough to realize that the other 90% of the… Read more »
MURF85
MURF85
10 years 3 months ago
Personal Finance and investing is an extremely complicated subject. Kiyosaki offers no particulars, just vague ideas. That combined with a few cute stories about little boys trying to make money, and its an easy, enjoyable 2 hour read. Yes it is a little bit motivational, and it does offer a few extremely basic ideas about personal finance, but if Kiyosaki really wants to help his readers, he would recommend detailed books about real estate, small business, investing, etc. to get people started. Instead his message is: “buy my other vague books, buy rental properties, quit your job and start a… Read more »
todd yarling
10 years 2 months ago
Good review, relates with my thots on this book. I was very very pumped when I first read this book a few years ago, then found my self with no real place to focus all that excitement and motivation. And the Reed accusations about his truthfulness are fairly damning. On the other hand… anything that disabuses people of the notion that things like houses and cars are automatic investments is a good thing. And anything that disabuses people of the notion that a high salary automatically equals weath is a good thing as well. So this book is a puzzler… Read more »
finance ninja
9 years 8 months ago

hahaha. I love the “I want to punch the kid in the face”. I can’t stand people that read it either. Although I read it years ago I do recommend it to people with no financial intelligence. You write some funny stuff sometimes. I don’t think I want to read your entire blog though. I wonder if my blog is ever going to get this big where my readers are lost and theres just so much. I better start organizing my blog more. well dude. funny article. later

Rick Goulian
Rick Goulian
9 years 7 months ago

I just completed the $400 3-day Rich Dad seminar in Phoenix and I have 1 warning: BE CAREFUL. The instructor, Steven Edwards, is a very slick salesman. he appears to be giving you concrete how-to information, but its really just a ruse to get you to sign up for more advanced classes which range from $10K – $70K!!! (I did not sign up for anything). Somewhat inspirational, but don’t expect to walk wawy with a wealth of knowledge you can begin using.

Marc Strassburg
Marc Strassburg
9 years 6 months ago

I have listen to his TV show at least twice and did not get one piece of useful information to follow — some amuzing anecdotes however. But, at the book stand at the airport reading one of David Bach’s books I learned some very valuable — even if common tips on finance — I am going to buy the Bach book for my kids I think.

Marc

Jenna
Jenna
9 years 4 months ago
Actually his books do give you information on what to do. Here is the problem One people by nature are lazy . Some people want stuff handed to them. It doesn’t work that way. He makes it very clear that if you are going to succeed in anything he has said its going to take time, research and understanding. He gives you very detailed instructions. It just depends on how you look at it. Some might say he gives you a tad bit of information. I say that he gives you the tools to make things happen and what you… Read more »
kong
9 years 4 months ago

Actually Kiyosaki books rich dad poor dad it very good. people are self-fish they don’t take the time to learn, they alway wanted to take the easy way out. for people whom are lazy let them be lazy. we still have a long years of living together. if they think that working is the way out let them work until their 65 years and i bet you that they will be sorry.

Kibrika
Kibrika
9 years 4 months ago

Again, I didn’t take the time to read all the comments. Rich Dad poor dad is what got me to read this site and this site is what got me to put at least the least amount of money in a savings account (with small percent).
What I lack are advice and education for my country situation. I live in Latvia and the financial situation is veeery different from that over the ocean.

idiare
9 years 2 months ago
Guys im really surprised that so many people expect a book to hold their hands and lead them to wealth…impossible! The book worked wonders for me, i read it first in university and it changed the way i viewed work and money. I can clearly say that i i am one of the people who have made money following advice from the book. Not nuts and bolts advice of course but a frame of reference that allowed me choose winning investments sometime with as much as 200% ROI in a developing country like Nigeria. Its a great book to start… Read more »
Ruth
Ruth
9 years 2 months ago

thanks for all your input guys. I have not yet read the book but I think I’ll check it out at the book store b4 I buy it. i think educating oneselves is one of the number one steps towards the road to riches. I think every one knows someone who is very wealthy, I say put forth effort and stop exspecting everything to be handed to you. I can honestly say no one likes a leach but people are willing to help those with a great desire to help themselves

Michael
Michael
9 years 1 month ago
I have read a few of the books as well and true it never gives specifics and yes there is a lot of repetitive information from his other books. However, just from the standpoint of getting you to think differently about money and to learn what you can about something can linit your risk. I have started taking real estate investing courses because I want to learn how to become successful at it. I think this is an example of what the book intends. You can not just sit at home and expect things to happen or wait for money… Read more »
UJU OKONKWO
UJU OKONKWO
9 years 1 month ago

Rich Dad is a must for any money-minded person.It is like a guide to wise decision making.

oliver
8 years 10 months ago
i think the most useful maxim that rich dad poor dad states is you have to use money to work for you. Beyond that most of the book consists of stories that are anecdotal and are suspiciously made up. The one piece of advice that kiyosaki emphasizes is that of sales and marketing skills which is probaly the source of his wealth. A writer researching kioysaki’s real estate dealings found no public records that showed how he attained his wealth. Its widely believed that much of his wealth has been attained not from his real estate empire, but the self… Read more »
Warren Majestry
Warren Majestry
8 years 9 months ago
One of the problems is that most people are looking for an easy way out. Everything you need to know is put in the books in an easy to follow guide. The thing is, you have to go beyond just the first book and probably read all his books. I personally own all his books and there isn’t one bit of information I didn’t find applicable. In fact, before these books I was pretty down on my luck and wondering what I was going to do with my life as I was a high school drop out. The books not… Read more »
PT from Prime Time Money
8 years 6 months ago

Thanks for sharing your review, Ramit. Very balances. I also read this book and enjoyed some parts. I’m currently giving away a free copy on my blog. Your readers can go here to check it out: http://ptmoney.com/2008/01/17/book-give-a-way-win-a-copy-of-rich-dad-poor-dad-or-die-broke/ Thanks!

Neo
Neo
8 years 4 months ago
I also have been to the 3 days Rich Dad Academy training which was 475 if you sign on the same night of 2 hours Free presentation that they do all over the US. If you are GREEN to the Real Estate world it is a lot of information that you will receive but not too many “how to connect the dots. Since there is not enough time to go over all the cool Real Estate areas that you can learn and benefit from it” If you are an intermediate or advance real Estate investor, agent or involved in any… Read more »
Maryanne
Maryanne
7 years 6 months ago
Ive read RDPD and found that even though Kiyosaki didnt offer up any step by steps to actually becoming rich he did give some good motivators and insights into how people think about money. And its true what he says about peoples attitudes toward the Rich. Some people hate Rich people simply because of the fact that they have more money than them, yet you dont see these people trying to change their lot in life, they just keep plugging away at the same ol same ol. Kiyosaki makes his millions off these books because people identify with something he… Read more »
anshul mehta
anshul mehta
7 years 6 months ago

i think the book teach us about the value of money.The more deep we read the book, more curiosity began of earnig money. Basically this book is for those who never earned a single peny and waiting for a shortcut to earn.

Jared Howe
Jared Howe
7 years 6 months ago
I am pretty ticked of at all these ding-dongs and yo-yo’s who expect to get rich quick. They expect you to make them rich. They expect you to take them by the hand, step by step, and show them how to become rich. Wake up people. You have to do it yourselves. You cannot expect or depend on anyone to do it for you. What is so great about Rich Dad and Robert Kiyosaki’s message, is “That you must change your way of thinking about money. Change your perception of it”. It is all about knowledge and education. I have… Read more »
Jon Klane
Jon Klane
7 years 5 months ago

Is it that hard to see that all John T. Reed is doing is selling his own product? Wow the obvious is so hard for some of you to see.

Young Investor
Young Investor
7 years 5 months ago
It is very evident that the ones who have a discrepancy with RDPD is because they have that poor mentality way of thinking and/or view a different reality then the logical point that Robert is making in his books. Several of you made it very obvious of which mentality you hold; considering you are disappointed that Robert’s books and/or his training doesn’t tell you how to connect the dots or provide step by step instructions on how to get where he is now. How professional John T. Reed, your statement: “I have grudging respect for this book, but every time… Read more »
David Moore
3 months 28 days ago

I wrote a review of the book also, I found it quite inspirational. I’ve read a few articles online that say the story behind it isn’t actually true – either way I don’t think it matters. The most powerful takeaway is that assets put money in your pocket and liabilities takes money out.

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