Robert Kiyosaki Blog

Financial Education Portal inspired by Robert Kiyosaki

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Debt becomes us

Garry Marr, Financial Post It was a stinging rebuke. I took it on the chin last weekend as I waited in line for a ride with my child at an amusement park in Toronto.  ”My dad has a BlackBerry,” the little monster gloated in front of my own boy as he looked at my bottom-of-the-line cellphone.  I hate having a cellphone but my spouse says it is a must in case of emergencies. (I’m not sure how my mother ever got a hold of my father in emergencies back in the 1970s. He didn’t even have a walkie-talkie). I tried to explain to the young lad that I spend as little money as possible on my cellphone, opting for a $50 piece of junk that lets me pay per call — something I don’t do much of usually. “Don’t you know you can get a BlackBerry for free,” he said, looking at me as if I am the dumbest adult on the planet. Of course, I don’t expect a child to understand that signing up for a “free” cellphone means a commitment to three years of payments that could easily add up to more than five times the cost of the phone that you got for “free.” Adults understand the deal. They just don’t care. Everybody wants a free BlackBerry or next-to-nothing iPhone today if they can pay for it tomorrow. The enormous debt levels in Canada, now 140% of personal disposable income, do not even include all the financial commitments and contracts we have from cellphones to car leases, says Doug Porter, deputy chief economist with Bank of Montreal. “Most of the traditional measures are the classic borrowing on credit cards, consumer loans and mortgages,” says Mr. Porter. “In the early 1990s, debt was underestimated because it did not take into account the leasing of cars.” Terry Leon, chief executive of Leon’s Furniture Ltd., proudly claims his company pioneered the whole “do not pay until” programs, which allow consumers to walk out of stores without putting up one cent. “We are going on as long as 100 weeks in honour of our 100th anniversary,” says Mr. Leon, referring to the fact consumers can now buy something in his store and not pay for almost two years. There is a difference from most debt with his store because Leon’s does not charge interest. That $1,500 couch is the same price whether you pay for it in full the day you buy it or wait the full 100 weeks before making your full payment. On its anniversary, more than half of Leon’s customers decided not to pay that day. That’s...

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Investor Types and Risks

The first step in developing an investment plan is to identify what type of an investor you are. Investor types are often determined by their stages in life. Here is a guide: – Single person under 40 years old. Focus: Long-term investments, medium to high risk. Emphasis: capital gain, compound growth. – Two-income married couple, no children, aged 20 to 40 years. Focus: Long-term investments, medium to high risk. Emphasis: capital gain, compound growth. – One-income family, young children, aged 20 to 40 years. Focus: Long-term investments, low to medium risk. Emphasis: compound growth. – Single person, aged 40 to 60 years. Focus: Medium-term investments, medium risk. Emphasis: capital gain, compound growth. – Married couple with adolescent or independent children, aged 40 to 60 years. Focus: Medium-term investments, medium risk. Emphasis: capital gain, compound growth. – All investors, aged 60 and over. Focus: Short to medium-term investments, low risk. Emphasis: Income. The following are examples of investment portfolio mixes for the various types of investors. Low Risk Investments: Low risk investments are predominately cash, fixed interest and superannuation. This has the lowest risk of all investments but has also the lowest return – in today’s market, approximately 3% to 6% per annum. Fixed interest includes cash, cash management trusts and bonds. They return approximately 5% to 10% per annum, sometimes as high as 15% if you invest in global bonds in good markets. Superannuation returns and risk profiles vary from institution to institution, however the best and safest usually return on average 10% per annum. Medium Risk Investments: Medium risk investments include property and non-speculative shares. Diversified funds, which invest in a range of asset groups, are also considered to have medium risk profiles. Average returns from these types of investments will range from 8% to 15% per annum. I also like to include the broad spectrum of mutual funds, to be discussed later, in the range of medium risk investments. Some can return up to 25% and more depending on the fund type and managers. High Risk Investments: High risk investments include all speculative shares, futures and any other type of investment that is purely speculative by nature. Because with these types of investments we are betting on whether the price will go up, or sometimes down, I often classify this as a form of gambling. Accordingly, the returns are unlimited but so is the ability to lose the total money invested. Read more: Investor Types and...

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Kim Kiyosaki’s “Rich Woman” Empowers Women to Financial Freedom

 Kim Kiyosaki is the wife of Robert Kiyosaki – who wrote the best seller "Rich Dad, Poor Dad". Kim Kiyosaki is all about empowering women and helping them take their financial future into their own hands. Pick up her book Rich Woman and start your journey toward real...

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Robert Kiyosaki: The biggest skill I have is making mistakes.

~ Stephen Key ~ Robert Kiyosaki’s best-selling book, Rich Dad, Poor Dad: What the Rich Teach Their Kids About Money – That the Poor and Middle Class Do Not!, has sat on my nightstand for a number of years. Within it, Kiyosaki advocates bold entrepreneurship and personal conviction as a means to achieving financial success and freedom; simply working as an employee will never generate significant wealth. Rich Dad, Poor Dad has been enormously successful. What advice does Kiyosaki have to give now? “There’s an assumption that once one has achieved a certain level of success, everything is easier. Not true! I face the same dilemmas and struggles today I did 30 years ago. It’s only the paradigm that has shifted. The way I perceive these problems is different; there’s a different sophistication level. But the lessons I learned as an entrepreneur working on a Velcro and nylon product decades ago are still relevant,” Kiyosaki explains. Before becoming a best-selling author, Kiyosaki was a product developer. He counts his inexperience and naivete at that time as a blessing. “If, at the time, I knew how much I did not know, I would have never started. I would have stayed in the Marine Corps, done my 20 years, and collected a paycheck. It’s a great thing I didn’t know,” he says with laughter. It’s the fearless acceptance of the mistakes he made (and, according to him, continues to make) as a result of that naivete that has allowed him to be so successful. “I blundered along then and I often feel like I’m blundering along now. What’s changed? I have smarter advisors,” he reveals. But as intelligent as they may be, Kiyosaki’s advisors aren’t responsible for his willingness to try and try again. “The biggest skill I have is making mistakes. I’m pretty much an expert now. In the corporate world, if you make mistakes, you’re fired. But in the entrepreneurial world, if you’re not making mistakes, you’re not learning. I enjoy making mistakes. As far as I can tell, every mistake is accompanied by a priceless lesson. I’ve built my life around these lessons.” While most people avoid fear rather than seek it, Kiyosaki adheres to a different principle. “If I don’t have butterflies in my stomach, there’s no sense working,” he says. Kiyosaki can explain his perspective on failure and fear in numerical terms. Simply put, the number of failures you experience is a reflection of the degree to which you’re putting yourself out there. And having the courage to put yourself in a position to fail will ultimately lead you to success. If you never try, you’re...

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Employee Or Entrepreneur

Being an employee or an entrepreneur isn’t so much a measure of what you do for a living as it is a statement about your mindset. There’s a huge difference not only between how they make money, but in how they think about themselves. Many self-employed entrepreneurs say that when they wake up every morning, they are unemployed. They know that unless they go out and make something happen, they won’t have any income that day. Employees on the other hand have no such fears—provided of course that they still have a job. Running a little late? No problem, you’ll still get paid. Feeling a little under the weather? No problem, stay at home and collect a personal day. Sometimes it gets to the point where employees are more concerned about their benefits—which they begin to consider as entitlements—than about actually providing value to their employer. And this is fine, as long as the employer tolerates it. But make no mistake about it—an employee who forsakes value in favor of the entitlement mentality is ultimately at risk of losing that precious job. So back to that statement about entrepreneurs waking up unemployed. Yes, they realize that unless they accomplish something meaningful during the upcoming day—by somehow adding value to society—they won’t have any money coming in. But they also know—and here is their motivation—that if they create massive value during the day, they will reap massive rewards. Every day that Bill Gates woke up “unemployed” while he was starting Microsoft carried him one day closer to becoming the richest man in the world. That’s how the entrepreneur’s mentality works. If you are in any way concerned about building long term wealth, but think about your income through the lens of an employee, you have a problem. You need to recast your approach and adopt an entrepreneurial spirit. And this doesn’t mean quitting your job and starting a little craft boutique at the local flea market. That’s a hobby and maybe a small business, but it isn’t an entrepreneurial approach. What you need to do is to find a way that you can start an enterprise which will allow you to generate a huge cash flow. Then you need to invest your profits wisely—in other words, by doing it yourself instead of relying on a purported “financial advisor.” If financial freedom and tremendous wealth are goals you’re serious about, lose the employee mindset and start thinking like an entrepreneur. In his ground breaking book Rich Dad’s Cash Flow Quadrant, wealth creation guru Robert Kiyosaki teaches that there are four quadrants for creating cash flow—Employee, Self-Employed, Business Owner, and Investor. Long-term...

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Rich Woman Kim’s First Investment

Kim describes her thoughts, decisions and fears of her first investment purchase. Listen in as she talks about the time it took to find the property and her fears of making a bad investment....

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10 Retire Young, Retire RICH Lessons

I have learned many lessons as a result of reading Robert Kiyosakis books. These are just a few I would like to share with you.  But bare in mind, these principles may throw everything you may  have learned out the door. Lesson #1: Your house is a liability, not an asset. Lesson #2: Leverage is the reason some people are rich and others do not become rich. And most people do not become rich because they fear the power of leverage. And the most powerful leverage in the world is your MIND. The poor and middle class have a hard time getting rich because they try to use their own money to get rich. If you want to get rich you have to learn to use others money…not your own. Lesson #3: Good debt makes you rich, bad debt makes you poor. Lesson #4: The choice of words you use will make you rich or poor. Words are powerful tools…tools for the brain. It does not take money to make money. “Getting rich begins with your words and words are free.†Poor people say ‘I can’t afford it’ more often than rich people. Your words become flesh.â€Poor people use poor words create poor peopleâ€. Lesson #5: The problem with having a job is that it gets in the way of getting rich. Lesson #6: The biggest challenge you have is to challenge your own self-doubt and your laziness. If you want to change what you are you must take on your self doubt and your laziness. It is your self doubt and laziness that deny you the life you want,â€.  If you will take on your self-doubt and your laziness, you will find the door to your freedom.†Lesson #7: It is your “Why†that gives you the power to do the how to. Instead of looking inside of themselves to find a ‘why’ they want to become rich, most people look for the easy road to wealth, and the problem with the easy road is that the easy road usually ends in a dead end. Lesson #8: Unless someone has a passion for something, it is difficult to accomplish anything. Rich Dad used to say. “If you want something, be passionate. Passion gives energy to your life. Passion gives energy to your life. Lesson #9: Take at least 1 hour each month to reflect on your life. Taking the time to reflect on Robert Kiyosaki life raised the following ideas. 1. What he thought was important was not that important. 2. What was important was where he was at, not where he was going. 3. There is no...

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Thirtysomething and Strapped: What to Do?

A new survey of young workers published by the AFL-CIO suggests many Americans under 35 can’t manage the basic financial building blocks of an adult life. The union calls the last ten years a “lost decade” for these young people during which many fell short on critical responsibilities like getting their own place, finding a stable job with benefits and saving money for emergencies. About 31% of survey respondents said they made enough money to pay their bills and set some money aside, and seven out of 10 respondents said they did not have enough money saved to cover two months’ worth of living expenses. Parents of these young workers know how far they are from making it on their own; one in three is living at home. “Along almost every metric, people under 35 are doing much worse than they were 10 years ago,” says Jennifer Jannon, 29, a regional director for Working America, the ALF-CIO’s community organization for non-union workers. “People are literally putting off starting their adult lives because of the conditions they’re facing economically,” Jannon says. She says the results should not be interpreted as laziness. “Young people are really yearning to move out on their own [and] to start their adult lives,” she says. “[But], they can’t find the type of work that supports an adult life.” Some take issue with the suggestion that the current job market is more difficult for young workers than for their counterparts over 35. “It’s easier for younger people because they have less experience, and they don’t cost as much,” says Robin Ryan, a career counselor and the author of “60 Seconds And You’re Hired.” “If you’re over 40, a lot of employers see you as expensive,” Ryan says. Employers may also assume younger workers are more tech-savvy and can more quickly adapt to a changing workplace, she says. Regardless of who’s to blame, the result for young workers will be a substantial loss of potential wealth over their lifetimes. A person who’s able to save $2,000 a year between ages 22 and 30 will retire with more money than a person who saves the same amount over a longer period from ages 30 to 60, says Thomas Holland, a partner at the wealth advisory firm Global Vision Advisors. It’s crucial that those seven out of 10 young workers who don’t have enough savings to last two months start saving right away. “Though the economy may be poor, what I find is that if you don’t establish savings habits early in your career, it’s not likely that at some golden age you’ll learn to save,” Holland says. Here...

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5 Strategies to Lower Your Rent Now

When it comes to lowering their monthly housing payments in the down economy, renters have homeowners beat. Refinancing a mortgage requires plenty of paperwork, a stellar credit score and weeks of effort. But property owners faced with profit-sucking vacancies and cash-strapped tenants are increasingly willing to negotiate. According to a recent survey from rental property marketplace Rent.com, 68% of landlords reported lowering rents or giving one or more months free to retain tenants. Try these five strategies to cut your bill: Research the market Learning what other people in your building and neighborhood are paying for comparable properties can help you figure out whether you’re overpaying, and how much room you have to negotiate, says Steven Cohen, the president of consulting firm The Negotiation Skills Company, which helps clients negotiate for better deals. Ask other renters what they pay, check similar property listings on Craigslist, and get a local comparison on RentoMeter.com. Cohen’s daughter Abigail tried that tip and found that others in her neighborhood on New York’s Upper West Side were paying an average 20% less than she was for a studio apartment. She brought those figures to her landlord and ended up with a new lease this summer for $1,550 instead of $1,850 — an 18% discount. Play up qualifications “If you aren’t a good tenant, you won’t have a strong case,” says Peggy Abkemeier, the president of Rent.com. “The landlord may not want to make concessions to get you or keep you in the unit.” Point out that you’ve always paid on time, have kept the property in great shape and haven’t had any complaints from neighbors. Renters hunting for a new place have less leverage here, but they can benefit from a reference from a previous landlord. Take on a roommate Obviously, the more people sharing your space the less rent you’ll pay. But landlords may also offer a break to fill under-housed units. When Eric Woodbury and two friends were apartment hunting in Medford, Mass., in July, one property manager offered them a three-bedroom unit for $2,000, or roughly $667 apiece. Or they could move into a $2,200 four-bedroom where one tenant was already in place, cutting the per-person rent to $550. “That was a big selling point for us,” he says. Look beyond rent If your landlord stands firm on the monthly rent, ask about other possibilities to cut costs. For example, you might negotiate for more utilities to be included or a discount on extras like storage space or parking. Rent.com found 38% of landlords were willing to reduce security deposits, and 8% relaxed pet policies (which typically include an extra security...

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Check out Rich Dad World and Powerpack!

Powerful tool for Rich Dad followers. Check it out!Share With a Friend | Rich Dad PowerPack Shared via AddThis See the original post here: Check out Rich Dad World and...

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