Robert Kiyosaki Blog

Financial Education Portal inspired by Robert Kiyosaki

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Tips from Ramit Sethi of I Will Teach You To Be Rich

Ramit Sethi, Author of I Will Teach You to Be Rich was interviewed by certified financial planner, Cathy Curtis at the Commonwealth Club of California event. Ramit talked about his book and some of his philosophies on personal finance management.  I recorded the interview and wanted to share a few snippets from the discussion about his “Bulletproof Personal-Finance System”. Watch the video and share in the comments your thoughts about his system. Have you tried it? Do you think it works? If not, why?  ...

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6 Rules for Investing

Investing may seem daunting for a lot of people. Maybe you have tried it once and failed, or maybe you are simply frightened of losing your money. To avoid losing any capital, you simply need to be aware of the main pitfalls and always avoid them. The simple, reliable rules for investing are: 1. Have a plan. Always ensure that you or your financial advisor draws up an appropriate investment strategy for you that incorporates your risk profile, timeframes and financial goals. As foolish as it seems, many people plunge headfirst into investing without thoroughly working through these fundamental issues. 2. Don’t put all your eggs in one basket. Obvious advice, but many people fail to follow it. Many people think that they are on the right financial track by paying off the mortgage on their family home and then buying another property for investment purposes. Think about it! You have put all of your financial eggs in one asset basket – property. What happens if the property market collapses? Despite common thinking that this is a safe way to invest, the outcome is very risky. You have invested all of your well-earned money into only one area. 3. Build in appropriate timeframes. There is an old saying, “When the tea lady starts to invest in the stock market, it’s time to get out.” What this means is, when the share market is so high that everyone starts to clamber on board, it has probably reached its peak. There are two ways of successful investment timing. The first is to always pick the low-end of the market to buy and the high-end of the market to sell. This is extremely hard to do. Even the best-informed experts have trouble. The second way is to choose good investments and stay with them over the long-term (say 10 years or more) and ride the waves of the market. For safe, easy investing, choose the second method. Do not buy into the top-end of the market and sell once it starts to fall. You will definitely lose money this way. 4. Avoid high-risk investments. These include risky business ventures, highly speculative stock, tax avoidance schemes or too-good-to-be-true propositions that promise unusually high returns. 5. Avoid borrowing for your investments. Although some financial advisors advocate ‘gearing your investments’, this can be fraught with danger. Gearing means to borrow. If borrowing for investments takes you over your 40% fixed costs margin, you will be cutting it too fine, particularly if you lose your current income level. 6. Stay with the traditional and known. The best and surest investments are fixed interest, property and shares....

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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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Can you read yourself rich?

~ Mark Bridge ~ The economic crisis has prompted many people to seek help from personal finance books, with Amazon reporting a significant uplift in sales. Classics of the genre promise a quick route to riches, while recent examples, written since the start of the downturn, tend to be more cautious and realistic in their claims. Times Money has looked at the five bestselling financial self-help books at Waterstone’s and asked financial planners for their views on the key ideas, rating the books from one to five stars. All have a snappy style and are accessible to the novice, but some are considerably more helpful than others. Note that the recommended retail prices shown can be beaten easily. All the books are selling at a discount at Amazon, and the fifth, by Richard Templar, is half price at Waterstone’s. Rich Dad, Poor Dad by Robert T. Kiyosaki Sphere, £8.99 This 1997 book, the centrepiece of the author’s self-help empire, tells the perhaps allegorical story of two fathers: Kiyosaki’s own and his best friend’s. The former, poor dad believed in working hard for a company and keeping “secure”. He died penniless. Rich dad chose to own businesses and boosted his income “passively” by investment, becoming one of the richest Hawaiians and leaving tens of millions of dollars. Kiyosaki admires the “positive-thinking” guru Napoleon Hill (see below) and touts mantras such as “I choose to be rich and I make that choice every day”. The focus is on getting rich, rather than being comfortable. He explains that his “personal basis” is property. Expert’s verdict Zac Ghadially, of Yellowtail Financial Planning, says: “Building an investment income stream can work, but not for everyone. Also, we are advising people to scale down on property at the moment — to use it to meet their life goals, but not as an investment.” Times Money rating (out of five): 1 star How to be Smart With Your Money by Duncan Bannatyne Orion, £12.99 This new book has the advantage that it was written for a British market with the credit crunch in mind. It offers a comprehensive guide to earning, spending, borrowing, investing, saving and budgeting — with sections on choosing a savings account and buying a car, for example. It also has a list of questions to ask when shopping for a loan. There is no get-rich-quick carrot or big “secret” to success. Bannatyne takes a more cautious line than Kiyosaki, writing, for example, that “the golden rule of investment is to spread your risk” — a strategy dismissed by the American as for people who “go nowhere”. He emphasises that readers should stop...

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Lessons off Bernie Madoff

Recently as I sat at a local coffee shop in downtown Charlotte recently I couldn’t help but overhear several patrons passionately discussing the Bernard Madoff case. “He’s such a crook” one gentleman exclaimed. “They should give him the electric chair” another woman protested. It got hot and heavy for awhile and really had me thinking about something my Dad told me years ago. He intimated that in a crisis situation before I start pointing the finger and blaming someone else for my problems I need to first check-in with the man-in-the-mirror (my dad said it way before MJ, but we love you for that song anyway Mike – RIP). In the many years since my dad’s death I’ve had the opportunity to reflect and contemplate his statement on many an occasion. My years in the finance business working with client after client revealed a dire lack of accountability on the part of clients who flatly refused to take personal responsibility for their own financial minefields. Often I’d develop compelling arguments as to why a couple needed to be involved in their financial makeover so as to learn the basics of what to do and not to do. “Can’t we just pay you to do it for us without being involved?” was the answer I would hear more often than not. I became exhausted with “fixing” a client’s situation only to have them present me with a new bag of goodies (debt, late payments, etc.) 6 months later. When I consider this Madoff case I ponder how all these supposedly-intelligent and savvy individuals could look at that man or woman in the mirror every day and not hold him/her at fault. They blindly trusted this man who really couldn’t be trusted. How could this happen you say?  Where was the S.E.C….(that’s another story). As far as this situation goes it all starts with poor stewardship. Individuals who, like many of my former clients, refused to take personal responsibily for their own money management. “I don’t have the time”, “I’m not good with numbers” or “My wife handles that” are some of the poor excuses I’ve heard. Now we are faced with the most horrific financial scam of our nations’ history. And while the victims are applauding the conviction as well as the 150 year sentence they still fail to see the forest for the trees. What Americans still don’t realize is that unless and until we turn off noise of the flat screens, two-ways and I-pods it’s only a matter of time before history repeats itself. Robert Kiyosaki has preached fiscal responsibility in his numerous best-sellers. However, it’s the same basics grandmom and grandad taught our...

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Balance Transfers

Transferring your credit card balance, or balances, to a lower interest rate card can save you money. The process is a tricky one — there are a lot of possible fees, penalties and ‘catches’ to beware of lest this move actually end up costing you money. It is also getting harder to do. Credit card companies are try to stop losing customers, and they are also trying not to gain customers who are only there to take advantage of introductory rates before they move on again. This is one credit card move that absolutely demands you read — and understand — all of the fine print. Different card companies handle it in different ways and have a wide range of fine print containing a myriad of rules. But just because hopping from one card company to another is harder than it used to be rates for balance transfers, but there are low fixed rates offered for balance transfers (that’s the card company’s way of getting you to bring your balance and stay). Key numbers If you do not transfer to a fixed rate (or even if you do because fixed — the rate you are getting, how long it lasts and what it jumps to when that rate is over. With a fixed rate you may not know when it will change, but there will at least be a guaranteed period before it can change. After you have those numbers, check out all of the related costs: • Does either company charge a fee for moving the balance? • Is that fee a flat sum or a percentage? • Does your old card company charge you another fee for terminating your account? • What fees and rates does the new company charge for new customers? • Will both card companies notify you when the transfer is done? • Under what circumstances can the new company change the introductory rate it gives you for your balance transfer? Beware of ‘tiered’ arrangements. These will let you transfer a balance and give you some sort of interest amnesty or super low rate for a period, and then there may be another rate or arrangement for some more time, then a third (or even a fourth) rate. The trap here is that you may start with a great arrangement and slowly find your deal getting worse and worse. Different rates There may also be different rates for purchases you make with your new card. For example you may transfer with no interest for three months on your transferred balance and any new purchases. Then for three months you may have different, but not...

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4 Last-Ditch Strategies If You Just Can’t Find a Job

With a record-high number of Americans collecting unemployment benefits, job seekers are being forced into heated competition for openings. Indeed, the number of people who have been unemployed for 27 weeks or longer has leapt to 3.2 million from 1.3 million at the start of the recession. The pressure is proving too much for some: Last month there were nearly 700,000 Americans that the Labor Department counted as discouraged workers–folks who have given up on looking for work because they don’t believe they’ll find it. If you are unemployed and you think you’ve tried everything–sent hundreds of resumes and gone to numerous networking events, talked to every person you know and lots of people you didn’t know. If you’ve worked on improving your resume, and cleaning up your cover letter — and you still haven’t been able to find work, then don’t count yourself out. You still may have some options. Here are some alternatives for the beleaguered job hunter: Start your own business. Economic downturns and lousy job markets can prompt some workers toward entrepreneurship. Tight credit is a hallmark of this downturn, however, so capital-intensive businesses will be more difficult to launch. Good news for the jobless: Some states offer help for the unemployed to become entrepreneurs. Residents of states including Maine, New Jersey, and Pennsylvania, may be able to enroll in their state’s self-employment assistance program. To qualify, you’ll need to be eligible for unemployment benefits, and you’ll likely need to meet a couple of additional criteria, such as being likely to exhaust your benefits. You’ll also need a viable business plan. These programs pay out the same amount of money as you would have received through traditional unemployment, but generally also provide help in developing a business plan and financial assistance for training courses. One note: A program may require that enrollees be collecting unemployment for a limited period of time. Pennsylvania limits it to those who have been receiving benefits for no more than 10 weeks. Do an unpaid internship. Most adults shake their heads at this option because they can’t afford to work for free. But if you’re already unemployed and your days are taken up with job searching, an internship can take up some of those hours without derailing your job applications. Katy Piotrowski, author of The Career Coward’s Guide to Career Advancement, recommends doing an internship at a smaller business that may be glad for your help. Approach the company with an offer to work a specific number of hours each week and arrange to split your time doing work that uses skills you already have–to their benefit–and work that trains...

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Big Lessons from the Big Three

~Robert Kiyosaki The other day, my wife and I were shopping for a new car. We stopped by the Cadillac dealership because we wanted to see the new Escalade Hybrid. The lot was filled with new cars. There were at least 10 salespeople ready to help us, but there were only two customers: us. I felt bad for those salespeople and the staff. I wish I could say we purchased a new car, but we didn’t. Many people blame the automakers for the problems that they are facing–and they are to blame, but not completely. As entrepreneurs, we can all learn at least three big lessons from the auto industry mess: Leaders should be on the same compensation plan as the sales staff. If Detroit’s leaders were paid only for the number of cars sold, they might be better businesspeople. Instead, the leaders have megasalaries, private jets, midweek golf outings and benefits suited for royalty–all unrelated to sales or company health. These corporate leaders have been stealing from the company, workers and investors who gave them so much. To be a great entrepreneur, be a leader who works for those who work for you. As the head of my company, I work for my customers and my workers. If my company is not profitable, I should not get paid.  Leaders listen to the customer. Never forget: It was the customer that wanted the big SUVs and trucks. An entrepreneur needs to have a crystal ball and prepare for changes in the customer before the customer changes. As my company’s leader, I have been preparing for this economic downturn for years. As some of you know, I have spoken out against the financial planning industry, mutual funds and the financial gurus who recommend them. Instead, I have been an advocate of personal financial education and have built my company around it. Today, my company’s sales have increased as more and more people realize that a well-diversified portfolio of mutual funds is not a safe investment and investing in a financial education might offer a better return. Politicians reward incompetence. Many of the politicians the Big Three automakers were begging for money are the very politicians who protected the inefficient industry. It was the politicians who protected the unions and high wages. Most entrepreneurs do not have the benefits of high-paid lobbyists and friends in high places. I realize President Obama promises change. But never forget: He is a politician, not an entrepreneur. Getting elected takes more than just money. That is why entrepreneurs need to watch what politicians do–more than what they say. Big Lessons from the Big...

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