Robert Kiyosaki Blog

Financial Education Portal inspired by Robert Kiyosaki

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Organizing yourself to financial success

“How do you know where you are going, if you don’t know where you have been?” I am a big fan of measuring performance through numbers. Numbers have no political agenda or emotions. They simply measure a result. In business, if I spend $10,000 on a trade-show, how much business have I got back from that? If its less than $10,000 then perhaps we shouldn’t sign up again next year. But most of us do not take this type of analysis in our personal lives because we don’t have a proper record keeping system. Watch any television show where they do a financial make-over and what’s the first thing the host does? Makes the person organize their financial lives so they know where they are at. You can’t plan the future without figuring out the results of your past and adjusting accordingly. When I was a little kid, my parents always argued about our “great” dining room filing system (he says with sarcasm). Everyone just threw the mail into piles onto our dining room table (we ate in the kitchen). My Mom always tried to clean it up and my Dad was always saying “don’t touch my stuff!” (I suspect a lot of you are nodding your heads remembering similar discussions at home). Of course, come tax-time, there would always be a mad scramble to find this tax stub or that statement, buried somewhere in piles. I am known at work as the pile guy- I file in piles at my desk (gee, wonder where that came from?) but I believe I am pretty good at getting myself organized on my personal finance side. I am not a personal organizer but this is what I do: I had my desk built-in with a shelf over it when I first moved into my condo. This is where I put all my current filing. My last year’s records are in the condo for easy access and everything else is in storage. I have two magazine files on my shelf over the desk. I bought them at Ikea for a couple of bucks each. One is labeled “bills” and the other “filing.” As soon as I get the mail, I file into one of the two files- immediately; no mail piles. Everything that doesn’t fall into those two categories, I recycle. Every Sunday I empty out both by either paying the bills or filing. I have separate binders for the following: (i) financial statement (bank statements, transaction records from stock trades, portfolio statements etc.); (ii) mortgage and condo related material (this is where I keep the legal documents from the purchase of...

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Money Lessons for Kids

An early action to teach your kid about money and savings are a good idea to give better money management ideas when they grow. Using simple methods depends on there age, you can easily bring them getting good understanding on money and can grow a habit of savings. Below are some practical methods a parent can use to teach there kid about money and savings. Have a look: Age group 1 to 7 – Give her a piggy bank and let her collect and deposit coins to that box. Regularly give coins to your kid for her piggy bank. This approach build a habit of small savings in the early ages. When the piggy bank is full, open a savings bank account in parents name and deposit the amount to that account. Small drops can form a sea in the future. Someone in my place starts this habit at the age of 2 and still he following at his present age of 43. The account his father opens for him still alive with enormous amount from his small deposits for long term and now he planned to teach this habit to his daughter and present this account to her. Age group 7 to 10 – Give her awareness about savings bank account, how adding and removing money from savings accounts, how the money growing in it with interests etc… teaching her about interest calculations will do magic at this stage. Take her to bank with you and let her learn how dealings are happening there. Give ideas to know more about bank transactions. Age group 10 to 15 – Start a recurring deposit. Instruct to add a small fixed amount in each month. She can easily collect this amount from her pocket money and gifts. You can also give small amounts as gifts on there good work like well study, helping mother and father, cleaning house, gardening etc. Let her build very good awareness about systematic savings well as the hardworking nature to get awarded promptly. Teach her on compound interest and the magic of compounding. It is very good in this age to know how compound interest works and how the amount increasing by its power. Give practical knowledge on banking services like using ATM, cheque book, internet banking facilities etc. Age group 15 to 18 – Give directions to get knowledge on various investment instruments available in the market. Teach her about mutual funds and how it is working, fixed deposits etc. Let her get awareness about various investment products and the difference of returns from these products and different risk levels related to each products.  ...

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How the Financial Crisis Was Built Into the System

~ Robert Kiyosaki How did we get into the current financial mess? Great question. Turmoil in the Making In 1910, seven men held a secret meeting on Jekyll Island off the coast of Georgia. It’s estimated that those seven men represented one-sixth of the world’s wealth. Six were Americans representing J.P. Morgan, John D. Rockefeller, and the U.S. government. One was a European representing the Rothschilds and Warburgs. In 1913, the U.S. Federal Reserve Bank was created as a direct result of that secret meeting. Interestingly, the U.S. Federal Reserve Bank isn’t federal, there are no reserves, and it’s not a bank. Those seven men, some American and some European, created this new entity, commonly referred to as the Fed, to take control of the banking system and the money supply of the United States. In 1944, a meeting in Bretton Woods, N.H., led to the creation of the International Monetary Fund and the World Bank. While the stated purposes for the two new organizations initially sounded admirable, the IMF and the World Bank were created to do to the world what the Federal Reserve Bank does to the United States. In 1971, President Richard Nixon signed an executive order declaring that the United States no longer had to redeem its paper dollars for gold. With that, the first phase of the takeover of the world banking system and money supply was complete. In 2008, the world is in economic turmoil. The rich are getting richer, but most people are becoming poorer. Much of this turmoil is directly related to those meetings that took place decades ago. In other words, much of this turmoil is by design. Power and Domination Some people say these events are part of a grand conspiracy, and that might well be. Some people say they represent the struggle between capitalists, communists and socialists, and that might be, too. I personally don’t participate in the debate over a possible global conspiracy; it’s a waste of time. To me, the wider struggle is for power and domination. And while this struggle has done a lot of good — and a lot of bad — I just want to know how to avoid becoming its victim. I see no reason to be a mouse trying to stop a herd of elephants from fighting. Currently, many people are suffering due to high oil price, the slowdown in the economy, loss of jobs, declines in home values, increased bankruptcies and businesses closings, savings being wiped out, the plummeting stock market, and rising inflation. These realities are all direct results of this financial power struggle, and millions of people are...

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Is $1,000,000 Enough to Retire On?

In my free time I regularly read Yahoo finance or the CNN Money articles related to personal finance and retirement. People are told that they need to save as much as possible for retirement, because they will be spending somewhat close to 75% of their pre-retirement incomes per year. In addition to that most so called financial guru’s claim that Social Security and Medicare will be either bankrupt or providing only enough coverage for the elderly that would allow them to enjoy cat food and insufficient health care in retirement.’ In order for people to be able to retire comfortably in those gloomy future years, they have to save as much as possible and invest it all in the stock market, in order to generate one or two million at the time of their retirement, which would then allow them to withdraw fund during their non-working years. I generally disagree with these articles, since they are way too general. They are written with the intend to target as many people as possible. But they are far away from the truth. In my opinion, it is important to have paid in full your primary residence at the time of your retirement. Once this is done, the income requirements are much lower than during your working years. Most financial experts recommend that the annual mortgage payment for a primary residence should not exceed 35%-40% of the family’s income. If you are currently spending 30% on your income in order to be able to pay off your house by the time you retire, then you will be able to live on 30% less income during retirement. In addition to that, if dividend and capital gains income continues to get a preferential tax treatment, you will need less investment income for each dollar of job income that the investment income is replacing. The best thing of investment income is that you don’t have to pay Social Security and Medicare on it. Finally, in order to determine your income needs in retirement, you should subtract the amount of money which you normally contribute to your salary every pay period. I wouldn’t expect that you will need to save for retirement, in retirement. If you contribute 10% of your salary to a 401K plan for example, then you need to subtract that percentage from your income needs. A potential wild card that could possibly derail one’s retirement is the rising costs of healthcare. We are constantly reminded how healthcare costs are rising exponentially and how they would become even more expensive in the future. I do think however that in the future health costs increases...

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“Rich Dad, Poor Dad” Author gives Investing Advice

Millions of people have sought Robert Kiyosaki’s advice on investing in real estate. The author of Rich Dad, Poor Dad believes America’s financial dilemma is directly related to the rest of the globe. ” I think the world economy is contracting which is why oil is coming down, gold is coming down, property is coming down all over the world,” said Kiyosaki. When it comes to investing, Kiyosaki said too many people get their advice from someone trying to sell them something. “So you’ve really got to be careful who you take financial advice from because ultimately that six inches between your ears is your greatest asset so be careful what you put in there.” Kiyosaki has made his money in real estate – primarily commercial real estate like apartment buildings. And his decision about what to buy might surprise you. “Real estate is based upon jobs. If the jobs are good, real estate’s good. If jobs are bad, real estate’s bad – it is that simple.” Good jobs, he says, indicate economic stability. “It really has to make basic business sense. So I’m buying real estate, apartment houses in Oklahoma. Why Oklahoma? Oil. That’s the number one reason – it’s a pretty stable economy, oil is always there.” If you are thinking of investing in real estate, Kiyosaki says there are three important considerations. “Number one, you have to have good partners, that’s smart partners. Number two you have to have good financing and the sub-prime was bad financing. And three with real estate you have to have good management.” He also stresses the importance of financial...

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The Business School

– Robert Britt I was reading Robert Kiyosaki’s book “The Business School for People Who Like Helping People” in which he talks about the tremendous learning opportunity in having your own business. Specifically he writes about having a network marketing business and how that can teach you to be a successful sales person. In order to be a success at life you have to be good at sales. Now, I know there are going to be people who will be totally turned off by that statement, and I think the only reason that would be true is because of misunderstanding. There is a misconception about sales in general. “Oh, no, here comes the sales pitch” might be something that comes to mind. BUT everyone loves to buy things, so the logical step is that something sold them on whatever you are buying. So do you really hate sales, or do you hate being sold to? The answer is pretty obvious or people wouldn’t be buying. How do you decide what you are going to eat? There is the taste factor, but there is also information on nutrition that enters into the picture and also commercials on TV, radio, billboards and what else? Opinions of people in your life. The opinions you share are actually a sales pitch. If people listen to you and go to a restaurant, or try a recipe that you recommended; you have sold them on that idea. So you are doing sales, but not getting any commission on it. The reason that you are comfortable doing this type of sale is exactly because you don’t feel like you are selling and the person who is ‘buying’ your opinion doesn’t think you have ulterior motives. Wouldn’t it be great if you could earn a commission every time someone followed your suggestion for a book, movie or restaurant? On the web, this can often happen. If you have links to products you recommend, and they are affiliate links, this brings you a small commission. In life, the only way you earn money this way is if you have a sales job, or a network marketing affiliation. The difference between the two is that in a traditional sales job, you only earn money on your efforts. In a network marketing company you earn on the efforts of those you bring into the business, as well as on your own efforts. This is the power of leverage. There is apprehension in people about network marketing, or multi-level marketing as it is sometimes known, but in truth the concept has come a long way since the concept was first introduced....

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How You Can Invest In Real Estate

Author: Alex Anderson Robert Kiyosaki, author of the Rich Dad book series, has said more than once that you don’t have to have money to make money. In “Cash Flow Quadrant” however, he reveals how much money he paid for his first investment condo. What if you want to buy a condo but you don’t have a few thousand spare dollars lying around to make it happen? You can still make your purchase. The trick is, you just have to think about things a little bit differently. If you have not seen the movie “Schindler’s List,” you probably should. Not only is it a great bit of social consciousness, its writers did a good enough job on Schindler’s character to give you a glimpse into his business know-how. The man wanted to build a factory because he knew it could make him a lot of money during the war. Thing was, he didn’t have the capital to build that factory. But the Jewish community did. He went to them and presented his idea about how, in return for their investment capital, they could take some of the goods produced and sell them on the black market. He talked to a lot of investors. He raised a lot of money. You can do the same thing, and indeed a lot of people do. If you see a good deal on a building and you haven’t the spare millions lying around to purchase it, put together a cooperative to buy the property. Even if you receive only 10 percent of the property’s earnings, that will be a nice, tidy sum if it’s the right property. That is why you shouldn’t content yourself with starting too small. According to Ken McElroy, who authored Rich Dad’s “The ABC’s of Real Estate Investing,” there is nothing wrong with small bits of real estate. He simply says that there is no reason to relegate yourself to them out of fear that you don’t have the skills to go larger, because it doesn’t really require more skills. You wind up outsourcing a lot anyway. What a larger chunk of real estate will do, however, is allow you to interest more investors, as they stand to make more money off the deal. A larger piece of real estate will also be very unlikely to slump into zero occupancy. As McElroy says, if you rent out a single-family unit and that family moves out, you have an occupancy rate of zero, and the property becomes a liability until you can rent it again. If you own interest in a 50-family building and 10 families move out, you still...

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What The Heck Is A Bureau Credit Repair Report?

To get a bureau credit report, you can do so from one of three federally recognized credit bureaus: Equifax, Experian, or TransUnion. Each of these bureaus will allow you to get one free report- which means if you access all of them, you can get up to three free bureau credit reports per year. Be sure to take advantage of this fact, and keep an eye not only on your finances, but on your security. If you are working towards repairing your credit, these reports will become especially important.   Oh No- What’s This, A Mistake? Correcting mistakes or questionable activity on your credit report right away is of vital importance. The more time goes by, the harder it can be to correct any inaccuracies. As well, your credit rating suffers. Not to mention being harassed by bill collectors for bills marked unpaid. When you see a mistake, you have to make a hand-written request to challenge the information and send it to the credit bureau that sent you the bureau credit repair report. The credit bureau has 30 days to get back to you. In the meantime, they will be contacting all of your creditors to verify if what you said was true. If they cant find anything to disprove your written request, theyll change the information in your favor. As a borrower, you also have the right to have written statements included with your credit bureau repair report. These can be included as a permanent record in your report- for future lenders to read your side of the story. For instance, if you were involved in some type of natural disaster or other significant event which affected you substantially, but had never missed a loan payment previously, they may take this into serious consideration when considering lending to you. What a Credit Bureau Report is Not A bureau credit repair report does NOT magically remove all information about your substantiated bad credit days, such as information about bankruptcies, loans and repossessions. Changing that information is highly illegal. A bureau credit repair report also is not a new or secondary identity file about your credit history. That also is incredibly illegal ” right up there with fake I.D.s and forged passports. If you have to have changes made to your bureau credit repair report, be sure those changes are actually put into your report. The best way to do that is to order another report. Life is fun, isnt it? Here is the original: What The Heck Is A Bureau Credit Repair...

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Don’t Let Tough Times Get the Best of You!

Robert talks about how to make the best of this economy and come out on top in this interview on one of the most highly viewed stations in New York, Fox 5. Read more here: Don’t Let Tough Times Get the Best of...

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7 Keys to Creating Wealth

What the financially challenged don’t know… 1.  They don’t know how to get into the money flow. The crucial distinction between sportsmen and spectators is not that the sportsmen play and the spectators watch; it’s that sportsmen get paid, while spectators pay! To get paid you need to be inside the lines, on the field of play. As long as you’re the one settling debts, you’re a spectator. You’re investing in someone else’s game. 2. They don’t know how to create value. To get into the money flow means creating value, and value is created automatically when you’re in your own flow, when you’re doing what comes naturally to you. Donald Trump is in his flow buying and selling property. He has an eye for spotting opportunities in buildings, which he buys and sells. He has become one of the biggest property tycoons in America. 3. They don’t know the difference between good debt and bad. When you buy a car or a boat, you’re buying a liability. Any purchase that does not put cash in your pocket is a liability. Good debt buys assets that bring in cash. If you take a loan to buy an apartment building that will produce revenue, that’s good debt. You can also borrow against your mortgage to acquire more assets. 4. They don’t know how $100 saved can be turned into $1000 invested. When you’re spending everything you earn just to survive and pay off debt, you normally think you don’t have much left to save. But the truth is you don’t need loads of cash to start saving, a few hundreds saved can be used to raise finance to buy an asset that will generate thousands. You can start with as little as $100. 5. They don’t know how to use other people’s resources. Take a look at any wealthy or successful person. Are they operating alone, or do they have a team of supporters? The gung-ho, lone-ranger approach simply does not work. The first step to getting on to the field is putting the right team together. You don’t have to know how to do everything, you only have to know who can do it for you. 6. They don’t know how to control their emotions. Starting your own business is risky. So is any investment. The single most important factor is not knowledge, but being able to manage your own emotions. Most people don’t invest or don’t start their own business, not because they don’t know how, but because they’re afraid. which leads to errors of judgment. Emotional maturity is absolutely crucial. 7. They don’t know why they want...

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