Robert Kiyosaki Blog

Financial Education Portal inspired by Robert Kiyosaki


Game of Money – Four Quarters of Life

Life is like a game of chances. You can win or you can lose. Everyday, we are faced with challenges, which can either lead us to become a winner or a loser. Learning financial literacy is essential to increase your chances of winning the game of life. Consequently, it is best to play the cash flow game to gauge how well did you grasp the concepts in winning the game of money. Recently, I watched another video again of Robert Kiyosaki as now he talks about the so-called Game of Money where he described the four quarters of financial life dividing it into 10-year horizons and asked, “at which age will you win the game of money?” Let’s view the four quarters of life with some inputs so that we know how will we win the game of money and retire as young as we can be. 1st Quarter (25-35 years old) – By this age, you’re probably done with your college education. Most of us start our careers when we land on our first quarter of life. We want a high-paying job, buy a car, have our credit cards and enjoy life. While many of us just want to enjoy life after graduation, it is advisable for us to: Savings should be our top priority. When you receive your paycheck, take out a certain amount and deposit it in a savings account. Once you accumulated enough savings, transfer the bulk of it into a higher yielding deposit account. Compound interest will help it to earn more interest. Get Insurance. Get insurance especially if you now have family and kids to support with at this age. The higher and the healthier you are, the cheaper insurance costs will be. Learn Investment Options. Think of investment options where you can invest your extra cash. You can invest it in stocks, mutual funds, real estate, bonds, etc. Start to educate yourself financially. 2nd Quarter (35-45 years old) – By this age, you are probably at the top of your career and definitely earning much more. But this quarter may also be the time when you’re starting to have your own family so that also means higher expenses. It is advisable to: Plan for children’s future. You are now working not just for yourself but also for your children. Plan for your children’s future by getting an educational plan or open a time deposit that’s under your children’s name and deposit an amount into it regularly. Make sure you have enough for your emergency fund. Emergency fund is amount totally dedicated to emergency expenses such as health problems, etc. A good amount...

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Brief tips from Robert Kiyosaki

What tips do you have for building long-term relationships with the people who can help a business and investments grow? You have to be a great leader. It’s something I’m learning. I never stop learning to be a leader. I can’t say I am a great leader. I desire. I strive. I improve my leadership skills. There’s a great book called “The Starfish and the Spider,” and it’s a great book on leadership. It’s a very simple read. They’re two different leadership styles. In other words, you cut the spider’s head off, the whole animal dies. You can cut a starfish up in a thousand pieces and get a thousand starfish. That’s the difference. I am a starship style. I am not a spider style. It’s a great book on leadership, and I’m consistent in my leadership. Looking back over the years, is there anything you would have done differently to be more successful today? I don’t regret anything I’ve done because everything I’ve done has been a learning experience. I never stop learning. I make mistakes constantly. Today, with the economy as hard as it is, I would just say a tough economy means I have to get smarter. That’s all it means. I don’t judge it as good or bad. Other than being on “Oprah,” what marketing and promotional activities have been successful for you? Every product I design has a viral component to it. In other words, I don’t have formal sales people working for me or my company. So if a product is viral, and that means if someone recommends your book to someone else, it was designed into the book and my board game. In other words, I have people teaching people or people selling for me. And in today’s over-cluttered, over-communicated world, the person you’re going to listen to the most is a friend who says, “Hey, I read a great book, or here’s a great product I recommend.” It is the most powerful form of marketing there is. It’s also the oldest form of marketing there is. Who are some other people that you look up to and have guided your career along the years? Well, I have partners who I respect tremendously. I only do business with people I respect. You look at all of our company, and my advisors are real advisors. They are not financial planners. They are not celebrities. They are people hitting the trenches every single day. Another thing too, I don’t have to know anything. I just have to know who knows. The reason I say that is I’m coming out with a new book called...

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Financial Lessons from Poker

Common advice about controlling spending is to track all your purchases and add them up each week or month. I believe that this is effective, but have been fuzzy on why it seems to work so well. Why can’t people just spend less without the constant reminder of how well they are doing? I got some insight on this question from, of all places, poker. For poker players there is a certain thrill to dragging in a pot of chips. The thrill is there whether it is a $1 pot or a $10 pot. The $10 pot gives a bigger thrill, but not 10 times bigger. Similarly, losing a $10 pot feels worse than losing a $1 pot, but not 10 times worse. This leads to some players playing in such a way that they maximize happiness by taking in many small pots, but losing some big ones. As long as they don’t count their dwindling chips, they can actually be happy playing this way. Counting your chips is a lot like adding up your spending at the end of the month to see what happened. You may feel good about having saved small amounts of money several times, but if you wasted a big amount just once, you’ve had a bad month. If you don’t add up your spending you might actually feel good about all the times you saved money even though you’ve had a bad month overall. Ignorance can be bliss for a while, but when the debts finally start catching up to you, there won’t be much happiness. The worse your financial trouble, the more often you should be adding up your purchases to take stock of your financial situation. Some people can get along by assessing their finances monthly, and others have to do it weekly to keep a lid on spending. Then we have the families who appear on Gail Vaz-Oxlade’s television show Til Debt do Us Part who have to assess their financial position with every purchase by abandoning debit and credit cards entirely and using cash. Go here to read the rest: Financial Lessons from...

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Experian stops selling FICO scores to consumers

On February 9, 2009, Experian stopped selling consumers their own score. They will of course continue selling them to creditors. Apparently, we as consumers no longer have access to FICO scores at all from them. The sell Vantage and Plus scores, which aren’t the same as FICO scores. FICO score are the ones that matter; they are what lenders use. It’s not clear what, other than score, you’ll have access to when you apply for a loan. There is a serious drawback for consumers here: you have to have a pull on your credit now to get a real score and you still may not have access to the information in your file. That makes it very difficult if not impossible to correct errors. It also makes it nearly impossible to enforce your rights under the fair credit laws and I suspect that that is the reason why Experian went this route. We have the right to see the reports on which the scores are based but currently not the scores. I think we should. One of the things I find to be sleazy about this industry is that they don’t have to show you what they share with lenders. Read the rest here: Experian stops selling FICO scores to...

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How will you get the money for a down payment in this real estate market?

Think about this question for a moment. Really think about it. Many people are interested in investing in real estate now because prices are the lowest they’ve been in years. But did you know that you need more cash/equity now to do the deal than you did at the height of the boom? It’s true! For example 3 years ago, I bought two properties one month apart for a combined purchase price of $1.09M. After closing, I actually had about $30K IN MY POCKET! I was only required to have 30 days reserves and the cash out counted towards it and exceeded the amount required. Talk about easy access to money! And you only needed about a 650 credit score, sometimes less. Today, those same properties would still be about the same price because of location but today, I’d need at least $273K cash for just the down payment plus nearly $80K in reserves. That’s not what I’d call ideal especially when you’ll need at least a 740 score. And we ain’t talking about no stinkin’ Plus score! You need a real FICO score. You can get all 3 real bureau scores at that link. A Plus score, which is what most sites give you is a sham. It’s not what the bureaus and it’s designed to blow sunshine you know where! There’s a reason they cost so little. You should alway know what your score is BEFORE applying with a mortgage broker. Aside from looking like a novice, you a decidedly unprepared because you don’t know what to expect. Buying real estate is a business and if you aren’t prepared to spend a little under $50 to be better prepared, you are in the wrong business! Besides, how much did you spend on mentoring or a boot camp and you still weren’t prepared? 3 years ago, you also could sometimes refinance a newly purchased property THE SAME DAY or within 6 months! Ask me how I know! Let’s take a representative bank-owned 3-family property in Fitchburg or Worcester today that only needs minimal work. Okay, so you are probably looking at $120K to buy and $20K for repairs or perhaps $60K to buy and $100K for repairs. If it’s a typical property with 2 or 3 bedrooms, active sales comps put this at about $200K after repaired value (ARV). Your best case scenario for purchase is likely to be on a $120K purchase, about $30K down plus another $20K in repairs? Where will you get $50K? Where will you get the additional $20K reserves? 3 years ago, you could have bought that property when it was in a...

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Great post on marketing by a Worcester County business owner

Laura Briere is someone I’ve come across because of posts we both belong to the Rich Dad Followers group on LinkedIn. If you aren’t a member, you should be (it’s free) and if you do join, connect with me! Anyway, anyone who follows anything to do with Robert Kiyosaki want to own a business, real estate and or other investments. That means you should be marketing (hear that real estate investors?!?). Check out Laura’s post below. I’m going to invite her to join us for a game. Robert Kiyosaki Knows His Marketing | Vision Advertising Robert Kiyosaki, Laura Briere, LinkedIn, social networking, real estate, investing, business, marketing Powered by ScribeFire. Here is the original: Great post on marketing by a Worcester County business...

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18.2% drop in home prices and it’s not getting improving!

No brake on home-price free fall in Case-Shiller index – Jan. 27, 2009 For the 12 month period ending November 30, 2008, the Case-Shiller Home Price Index shows a drop nationwide of 18.2%. Since mid-2006, it’s fallen 25.1%. Don’t expect this to change anytime soon. Flood of foreclosures: It’s worse than you think – Jan. 23, 2009 Banks are slow to foreclose and list right now. The supply of homes is roughly double what is currently listed. Make sure you have enough margin in you calculations or will cash flow! Additionally, more people are out of work. Bloody Monday: Over 71,400 jobs lost – Jan. 26, 2009 Plan B (or C, D, E or F) is even more now than ever. Real estate is a good plan B; I obviously think so or I would be involved. You still should be looking at other ways of making money. Curious? Email Lee or give him a call! Home prices, foreclosure, REO, bank owned, unemployment, Plan B Powered by ScribeFire. View original here: 18.2% drop in home prices and it’s not getting...

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Our Nightmare Before Christmas

Forwarded by Danielle Rocheford Our Nightmare Before Christmas (or Unitil Utilities Suck) Twas two weeks before Christmas and all through the town it rained and it froze and the trees all fell down. The wires that were strung on utility poles snapped like a twig and the houses all froze. We got our selves nestled all snug in our bed while visions of warmer days danced in our head, and me in my thermals and Pa in his cap stayed huddled together for a bone chilling nap. The moon on the ice made a crystalline glow and we thought to ourselves, just how long can this go? When what to our wondering eyes did appear but our son with some coffee and donuts and cheer. We could see our white breath in the darkness above and deep under the covers I searched for my love. His feet, they were frozen and so was his head — made me think to myself that he just might be dead. The days passed so slowly, we must be insane as we waited and wondered and called out by name “On Thursday, on Friday, on Saturday (shit!) on Sunday, on Monday, on Tuesday (please quit!) on Wednesday, and Thursday and Friday (oh dread!) the kerosene fumes must have gone to our head. To add to the pleasure of winter’s delight two snowstorms came by – 18 inches of white. The snowing and blowing made things bad to worse and we prayed to the heavens our pipes wouldn’t burst. Pa’s eyes now were sunken, his expression — not merry, his cheeks had a pallor, his nose like a cherry. The odd little smile on his face wasn’t fun and he often was mumbling “go get my gun”. Then a rap on the door, and the fireman said, “Are you sick, are you sane, and is anyone dead? There’s a shelter, there’s warmth, you can come if you’re able, we have showers and kindness and food on the table” — and we looked at each other and thought — “what the heck?” yeah … eleven days later you FINALLY check! On night number twelve we heard the faint roar of a convoy of trucks and we ran to the door. To the top of the poles, to the stretch of the cable — please bring us your power just as fast as you’ re able! They spoke not a word, but went straight to their work and the power came on with a hum and a jerk. They heard us exclaim, as they drove out of sight — MERRY CHRISTMAS TO ALL! WE HAVE HEAT!...

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Fanny Mae and Freddie Mac Halt Foreclosures!

Wow! Fannie Mae and Freddie Mac have ordered their services to halt foreclosures and evictions between November 26th and January 9th. There are qualifications to meet and it’s designed to allow a rescue plan time to work. Get more details Powered by ScribeFire. Here is the original: Fanny Mae and Freddie Mac Halt...

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Be a patriot. Vote.

Tomorrow, November 4, 2008, is the day where you get show that you are a patriot. It’s all well and good when people show flags on their car, despite being an improper display of flag etiquette. I’m not talking about any silly criticisms of wearing (or not wearing) a flag lapel pin. I’m talking about the single most important duty of a citizen in a democracy. I’m talking about going to your polling place to vote. Naturally, I’d prefer that you vote for the party and candidates that I support. More importantly, I want you to vote. I’ve heard all sorts of responses leading up to election day this year, just like in years past. Some are diehard supporters of one candidate or the other, some hold their nose and some refuse to vote claiming that it doesn’t matter. If you think it doesn’t matter, then don’t whine about how bad things are while you endanger the foundation of democracy. You claim to care so much yet show me that you care so little. Pay attention, really learn about the issues, make your choice and engage others in discussion. Show yourself and others that you value living in a free country. Participate and take your duty seriously. We are all responsible for what happens in this land. Vote. If you are local and don’t have a way to get there, call me. I’ll drive you there, even if you vote differently than I do. Read more: Be a patriot....

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