📚 Rich Dad Poor Dad
Book Title
Rich Dad Poor Dad
(non-fiction | personal-finance)
Author
Robert Kiyosaki and Sharon Lechter
Review
- Assets (Stocks, Real Estate) > Liabilities (House Maintenance, Subscriptions, Debt)
- ‘Pay Yourself First’
- Income -> Invest in Assets -> Expenses -> Liabilities
- Even if you fall short, pay yourself first. This will keep you motivated to come up with income ideas to pay rent, etc.
- Minimize Taxable Income –> Maximize Assets Income
- Pay Professionals Well
- Tipping restaurant service ~15% but not paying your broker ~7%? The better you pay and treat YOUR people the more money you make. Win-Win.
- Investing Tip
- Move a sizable amount of capital into a company that is just about to make a move that will greatly increase it’s stock value and hold it
for a week while the stock rises in value and then take out the initial investment amount (‘principal’) but keep the earned return without
worrying about the fluctuations. Use the principal to start working on other assets.
- Company $1500 for 3 shares at $500/share
- Week earns $1800 for 3 shares at $600/share
- Take out $1500 (for 2.5 shares) and keep $300 (0.5 share)
- Money goes in, comes out, and I own a free asset (0.5 share of Company)
*** Only play with money you’re willing to lose (as this is speculative)
- Move a sizable amount of capital into a company that is just about to make a move that will greatly increase it’s stock value and hold it
for a week while the stock rises in value and then take out the initial investment amount (‘principal’) but keep the earned return without
worrying about the fluctuations. Use the principal to start working on other assets.
- Profits in Buying NOT Selling (during Bear Market)
- Toilet paper cost goes down, you should stock up. So why run away and sell stocks during a bear market?
- Toilet paper cost increases, you shouldn’t buy. So why get enthusiastic and purchase during bull market?
- Ex. I have a Company share for $100
- Share begins to decrease in value
- Day 1: I purchase the decreased share at $50
- Day 2: I purchase the decreased share at $30
- I average 3 shares at $180
- or $60/stock for total 3 shares
- vs $100/stock for total 1 share
- Question: Can you purchase a % of 1 share?
Financial Freedom
1) Earned Income
2) Passive Income
3) Portfolio Income
Start at 1) but get to 2) and 3) ASAP!
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