Rich dad, Poor dad

Author: Robert T. Kiyosaki

My Rating: 4.6 / 5

rich

 

“Working hard for money is an old formula born in the day of cave man”

Go to school, get good grades, find a secured job, work hard, save money and retire – this has been the mantra of our life. But by following this mantra the middle class will remain as middle class only passing on the same cycle to the next generation. The reason for this (as the author puts it) is that we haven’t been thought financial intelligence in our schools i.e we haven’t been thought the art and science of making money. The author illustrates a few examples of how cash flow works and explains the differences between cash flows of poor, middle-class and rich people and thereby emphasizing why they are the way they are. It all comes down to how well we manage our asset columns. I would like to mention the highlights of this book.

Middle class/Poor vs Rich:

This difference comprises the core of the book. The author stresses on the fact how to make money work for you instead of working for money. He uses two terms viz. “Rat race” and “Fast track” predominantly throughout the book. The former refers to the mundane middle class habit of working hard at the job, paying bills and liabilities, saving in a conventional way not bothering to build on the asset column. In simplistic terms he defines asset as something which puts money in your pocket and liability as something which takes money out of your pocket. The latter refers to a smart habit which according to the author pushes people from middle class to the so called rich. It incorporates the idea of building our assets until our asset column alone is sufficient to meet our expenses with or without our day job. According to the author, assets are stocks, bonds, mutual funds, income generating real estate or anything that produces income, appreciates and has a ready market.

Playing safe vs Playing smart:

The author puts spotlight on the fact that many people never become rich because they show reluctance in taking risks and hence they make “safe investments“. But the problem with these investments is that they give very low returns. And of course the author acknowledges the fact that there is a higher risk involved when you make investments which have the potential to milk higher returns. But that is exactly where financial intelligence comes into picture. He further asserts that there is not a single rich person in this world who hasn’t lost money while experimenting. You lose, you learn from your mistakes, you learn new formulas and you invest again – this time more sophisticated. This is how smart people invest.

Controversial views:

The author contradicts the popular saying “Our home is our greatest asset“. Instead he views it as a liability unless you have generated an asset column which pays for the bank loan. A bigger house usually means higher expenses as we have to refurnish everything matching the requirements of it. What many people fail to consider is the property tax which will be incurred upon them. Also, we miss out on the opportunity to make other investments which would have grown faster in value simply because we have no money left to invest. Another controversial view is “Pay yourself first and others later“. Even at times when you realize that you will not have enough money left to pay bills, the author still asks you to pay yourself first. Our asset column should be far more important to us than anything else. He claims that it is a good money habit because when we pay ourselves first we get financially stronger and when we pay ourselves last, we let people like bosses, tax collectors, bill collectors and managers push us around all our lives. Though I wasn’t fully convinced with the author’s views personally, these insights gave me a different approach to look at the same topic.

Who can buy this book ?

Anyone who has a fire in their belly to become rich. But, doesn’t that mean everyone ?? No, it doesn’t. There is a fine line between people who have the desire to become rich and people who take steps towards it. The author illustrates by using an example that it is strange to see people who give 10 percent of bill as a tip but are hesitant to give 5 percent of fee to a broker. This book definitely serves as a great inspiration to take action but it alone isn’t sufficient. Personally, I would say it is a very good start for anyone who plans to invest.

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WHAT YOUNG INDIA WANTS

  

Author      —  Chetan Bhagat

My Rating –  4.2 / 5

A non-fiction written by an author who is well-known for his fiction writings, itself gave the readers a keen interest. His readers must have expected him to write something fun, romantic and dramatic writings as he always does in his alternative style. Maintaining the same style he just changed the content and the content is about suicides, corruption, poor health facilities and education which doesn’t brings up innovating masters in our country. Bhagat mentions that: Corruption is a way of life in India which is a by-product of a system that is power driven. He refers the system to the constitution and power to the wealthy political leaders. But corruption is not just confined to the system but also the society. A remarkable statement: ‘The system changes with better policies and society changes with better values’ gives you a gist of the writings in the book. If it had been any other author it might be a bit boring but this one is a beauty. The book is primarily based on the youth of India as most of the country is young .

HIGHLIGHTS :

                                                      The book gives detailed information of the politics in India and how we are bound to it. He boldly tells how the UPA and NDA governments actually behave according to their policies. But there are some highlights in the book which I want to mention :

1-SPARKS :

This section is confined to students which I liked the most because I am one of those. Spark is the excitement which makes us feel truly alive. When we are kids we used to have a million sparks. A spider-man toy was enough to excite us to jump on the beds. A gift presented on our birthday made us to somersault all over the house. A movie show or a dine at the restaurant or a country side trip used to fill up us with interest, curiosity and anxiety. This excitement is called as spark.

When we reach the graduation age we still have these sparks with us but comparatively less. As you move on to the older age, it is difficult to find these sparks in us. Chetan takes an example of Kareena in the movie Jab we met. When we compare her to the first half versus the second half, we find that she loses her spark in the second half. This is what that happens to us if we lose the spark. Chetan says that these sparks can be invoked by three factors and should be protected from four storms. They are:

  • Reasonable goals
  • Balance of health and relationships
  • Not taking things too seriously

And the four storms are:

  • Disappointment
  • Frustration
  • Unfairness
  • Loneliness of purpose

The author says that to keep these sparks alive we must always have goals as by human nature we always strive, improve and achieve our full potential. He tells us not to do things for money, he tells us to do those things which our heart tells us to do, the things which make us happy and the things which make us feel alive.

Secondly, these goals should be balanced. It’s not just about our career goals, it’s about our health, our relationships and of course our peace of mind. What is the use of coming first in a race without lemon in the spoon? Our striving is only worth if there is harmony in life otherwise the spark begins to die.

Thirdly, don’t take life too seriously. The author says that Life is a prepaid card with limited validity. If you live for 60 years you will just have 3000 weekends. It’s okay, bunk a few classes, fall in love. We are people, not programmed devices. Now isn’t that something we always wanted to hear from our parents and teachers!!! I am not kidding, seriously!!!

Chetan also adds that we have 4 obstacles which try to kill our spark. The first being disappointment which comes to us when we do not get the expected results for our efforts. If we can overcome every challenge, then the word challenge will never exist. If we are failing at something, it implies that we have a different stage. Secondly frustration turns our internal energy into something negative, if we are frustrated it implies that we haven’t followed the third principle and took something very serious in our life. Thirdly, never think that life is unfair comparing to others connections, rich dads and beautiful faces. Finally, the most beautiful thing described by the author is isolation. As we grow older we realise that we are unique and what we believe in and what we feel is different from others. It happens because we compromise many things for our families and loved ones which mean so much to us. Chetan says Love yourself first and then others.

Wow!!! Now isn’t this something cool which made us realise that we are missing something. I just felt as if I founded the path of my life.

2. CRITICS:

The next highlight is how Bhagat boldly aims at the leaders of our country. As I mentioned earlier, the critic is not just confined to the system but also the society. Yes, because many of us vote a party by seeing its religion or caste of the leaders but not by their efficiency. We choose leaders from the craze which their dads own. The author precisely describes what Indians do to themselves.

It may be the madam of BJP (indirectly aiming at Sushma Swaraj) who tells us to burn down the Walmart stores or the woman who puts a money garland around her neck (indirectly Mayawati) or the person who thinks that silence is a golden tool or a form of Gandhigiri (indirectly Manmohan Singh) or the woman who keeps quiet even after seeing the corruption in her party (indirectly Sonia Gandhi). Whoever it may be, Chetan has a point in detail why these political leaders have to change their so called attitude.

 3. THE LETTERS AND THE TALENT:

Chetan has written two letters in this book, one to Gandhi and the other to Sonia. In the letter to Gandhi, he describes that India is free from the white people but not from the problems. Many people do not even get the basic amenities while the people who get them do not get a platform to do really something innovative. Also, in the letter to Sonia he addresses how the unaccounted money comes during electorate campaign and reminds her that she has a major role in ending corruption in INC.

And yes, talent is a precious natural resource and we must nurture it. Why does majority of students opt for either engineering or medicine after their plus two? It is because they are passionate towards these streams. Now, can there be anything more senseless than this answer? More or less, this is what even Chetan wants to say us. He says that Talent is a special ability and aptitude that gives people an edge in a particular field. Of course, even if we don’t bring out our talent we can do things but with talent we can change things.

WHO CAN BUY THIS BOOK ?

Well, it really doesn’t matter but since the book is largely focused on the youth, they are more preferred. It really is a book that is worth reading for all the others too. Also, the book is not just the highlights which I had mentioned, it has got a lot more general facts which the author describes in his own style. Of course, even our political leaders (at least those who can understand English), second or third generation business giants should also take a look at this book. I am not a fan of Bhagat personally but the thing is that good literature must always be encouraged!!!.