Learn 3 Important Financial Lessons from “Rich Dad Poor Dad”

How Do You Avoid Entering Into the “Rat Race”?

A Book Review – Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!

By Robert T. Kiyosaki

Lessons from Rich Dad Poor Dad
3 Important Financial Lessons from Rich Dad Poor Dad

What is this book about?

“Rich Dad Poor Dad” by Robert Kiyosaki was first published back in 1997 and remained as one of the bestselling personal finance books in town. I only sought to read this popular book recently and I am eager to learn the lessons from “Rich Dad Poor Dad”.

The book consists of 9 chapters and is around 350 pages long. I bought the 20th year anniversary version to read and by the end of each chapter there is a helpful summary to recap the lessons for that chapter.

At the beginning of the book, Robert described his story of having two fathers: a Rich Dad and a Poor Dad.

The Poor Dad is his biological father, the Rich Dad is the father of his best friend, Mike.

Mike and Robert wanted to become rich at a very young age, and by a turn of events, Rich Dad took both of them under his wings to coach them about becoming rich.

The book shares with you the lessons the two fathers (mostly from Rich Dad) taught Robert and how he was inspired to become a rich person.

The links for purchasing the book are paid links via Amazon which we may receive commissions from qualifying purchases.

Get your copy today!

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Who is this book for?

“Rich Dad Poor Dad” is a personal finance book written for readers who wanted to learn more about money and how to become rich.

If you have certain degree of business knowledge, this would be an easy read for you. And you should enjoy the content as it’s closely related to business and money.

Even if you consider yourself as having no business acumen at all, you will still be able to learn a great deal as the book is written in a conversational format that makes you feel easy to digest its content.

Highly recommended for readers who aspire to think and grow wealthy in their lives.

3 Important Financial Lessons from Rich Dad Poor Dad

Personally, due to the styling of older books you may not easily understand Robert’s line of thoughts simply from the book’s table of content.

For your better reference, I summarize and set out my learnings into 3 crucial lessons from the book:

Lesson #1: The Rich acts on Logic. The Poor acts on Emotions

The author began by telling us the story of Mike and him working for Rich Dad. Rich Dad promised that if they worked for him, in return he will teach them how to become rich.

Mike and Robert worked diligently day after day. After working for more than 3 weeks however, Robert found that Rich Dad still has not taught him anything.

Robert was furious.

Photo by Andrea Piacquadio on Pexels.com

With anger filling his mind, Robert went straight to Rich Dad’s office demanding him to honor his promise else he will quit the job.

Little did he know, Rich Dad expected the visit and he deliberately made Robert have a taste of life by working and feeling emotional for not being rewarded.

He made Robert understand that most people are driven by their emotions, especially towards fear and greed.

From Robert’s initial reactions towards Rich Dad, we understand that emotions can easily blind our mind and hence our decision-making abilities.

Rich Dad further explains that:

“We will always have emotions of fear and greed. From here on in, it’s imperative for you to use those emotions to your advantage, and for the long term to not let your emotions control your thinking.”

Putting this learning into money perspective…

It means that blindly chasing money will make you lose sight of what is more important.

Most people are afraid to admit that money is running their lives, and this denial in facing their emotions will in return make money control them.

The Poor usually will end up here in life and get stuck.

The Rich, on the other hand, understands that money is a tool. They can see and avoid the traps of falling as emotional victims to money. They act logically towards money and will try to build businesses which make money work for them.

An important quote from the book sums up Lesson #1:

“The poor and the middle class work for money. The rich have money work for them.”

Lesson #2: It is important to learn to become “financial literate”

Robert pointed out that typical education has taught us to find a job after university and work hard on it.

In fact, Rich Dad pinpointed that “A job is really a short-term solution to a long-term problem”.

Finding a job and working for money opens the trap to fall victim into entering a “Rat Race”.

What is a “Rat Race”?

Following Lesson 1 above, most people act on their emotions and let fear and greed control their lives. The fear of lacking makes us work hard to earn money. But once we earn that money, greed kicks in and make us spend more.

The more we spend, the more we need money.

This endless cycle of fear and greed is what Rich Dad described as the “Rat Race”. And the worst part is that most people will keep on pursuing this Rat Race without even realizing it.

What should we do?

Learning is the key to break the loop and prevent ourselves from entering the “Rat Race”.

To be more precise, we should understand more about how money works. That means we should learn to become more “financial literate” so that you can have better control over life.

Understand and identify what are income-producing assets, and avoid treating debts as assets.

When you grow more financially sound, you will no longer fear losing money as you understand the greatest asset that no one can take away from you, would be your knowledge.

Even if you lose your job today, you will have the confidence to use your skills to earn back the monies.

This is the true importance of financial literacy.

Lesson #3: Mindset separates the Rich from the Poor

Throughout the book, Robert has made clever distinctions between the Rich and the Poor by contrasting the behaviours between his two fathers.

The example Robert gave below has made a deep impression on me.

When Poor Dad needed to buy something, his response will always be “I cannot afford it”.

Whereas for Rich Dad, even if he cannot buy the item yet, he will keep asking “How can I afford it?”.

The slight difference in mindset towards money sets apart largely the Rich and the Poor.

difference in mindest sets apart the Rich and the Poor
Photo by Sora Shimazaki on Pexels.com

The Poor stops acting when their brains tell them that they can no longer proceed.

On the other hand, the Rich keeps on exploring for new ways until they achieve their goals as their brains encourage them to keep going.  

Robert pointed out that human’s fear towards money is the greatest obstacle suppressing our potentials to do more.

Everyone has a fear of losing money. But the primary difference between the rich and the poor is the way they manage fear.

Fear is a normal human emotion and fear of losing is imminently true. In order to face this fear, a practical tip for you is to start as early and as young as you can.

Start early so that you can have more time to learn from your failures. Take time to improve on your financial decisions.

Your mindset is the greatest assets that defines your wealth.

The good news is that you can always learn and train your mindset through reading and practising.


I hope you have now learnt the 3 important financial lessons from “Rich Dad Poor Dad”.

This is such a thought-provoking book and it opened my mind to many new perspectives relating to financial literacy.

I highly recommend you read this book regardless of whether you have any formal business education or not. It is certainly a rewarding read and I am sure you will learn something valuable from it.

Thank you for reading and I will see you in the next post!

Read “Rich Dad Poor Dad”

The links for purchasing these books are paid links via Amazon which we may receive commissions from qualifying purchases.

Get your copy today!

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One response to “Learn 3 Important Financial Lessons from “Rich Dad Poor Dad””

  1. […] is unlike traditional personal finance books such as “Rich Dad Poor Dad” or “The Millionaire Mind”, which teach you how to think or behave like a millionaire. This […]

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