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A financial tale of two dads

If you are confused about where to invest your money, it’s no wonder. Not even the top investors in our country can say with any degree of certainty what’s ahead for stocks and bonds. At the same time, there is no shortage of suggestions.

For years, the book “Rich Dad Poor Dad” has stayed on the business best-seller list. When a book captures public attention as a way to build wealth, financial educators and planners become curious about its appeal. “Rich Dad, Poor Dad” by Robert Kiyosaki has spawned an entire industry of books and products that purport to help people build wealth. Is this book the answer to everyone’s financial dreams, or is it instead a “devil in disguise” that will make Kiyosaki richer but leave the rest of us poorer?

Kiyosaki begins his book by describing his two dads. His own dad was highly educated and intelligent. His other dad, the father of his best friend, never finished the eighth grade. “Both men were successful in their careers, working hard all their lives. Both earned substantial incomes. Yet one struggled financially all his life. The other would become one of the richest men in Hawaii.” As you might guess, the rich dad was not the one who was highly educated.

Here are some of the positive ideas from the book:


  • Start early to build assets – live beneath your means.
  • Avoid liabilities as much as possible and pay them off as soon as possible.
  • Evaluate which assets deplete or generate income.
  • Goal-setting is critical.
  • Working with experts is a good strategy.
  • Learn entrepreneurial skills.
  • Financial literacy and financial education are encouraged.
  • Teaching children about money is important.

Here are my concerns about the book:


  • Business ownership is made to sound easy when, in fact, it can be quite risky.
  • The book implies that getting wealthy is the only worthy goal one should have and gives the impression that Kiyosaki scorns or dismisses those who do not share that goal.
  • The book seemingly portrays two groups: the wealthy, happy people and everyone else who, if they aren’t making lots of money, are probably poor and unhappy.
  • The value of education for any reason other than increasing wealth seems to be discounted.

Kiyosaki has a patronizing attitude toward his own dad and others who choose to devote their lives to worthy but not financially rewarding causes, even if they are highly respected and successful in those life endeavors, as was his own dad. Readers can get the impression that devoting their lives to a worthy cause that does not pay well is not important.

People who are unsophisticated about money may be unprepared to analyze how well Kiyosaki’s approach to building wealth would fit their abilities. The book does not speak to balance nor does it discuss the broader financial context into which investments must fit in a person’s life. Those desperate for a quick fix to their financial problems are apt to finish reading the book believing that, “All I need to do is buy real estate and then all my problems are solved.” They do not realize the time, effort or experience that is necessary to achieve what Kiyosaki has achieved. Following the ideas blindly, they could lose their shirts.

For people who have read Kiyosaki’s book, I would recommend using his ideas in the context of critical thinking. Learn what is involved in business and real estate ownership. Kiyosaki’s encouragement to acquire entrepreneurial skills is probably beneficial in an economy where working on a contract basis rather than being employed by a company is expected to become more prevalent.

Consider real estate and business ventures when constructing your wealth plan, but use a broad basis of assets; don’t expect to get rich quick through just one market segment.

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