Manage Your Personal Finances Rich Dad Poor Dad – Jammu and Kashmir Latest News | Travel

Arjun Singh Rasol
Many young people don’t know what their ideal financial goals should be. Most of them got into the habit of exchanging time for money. This type of contract in which a person trades their time, money and effort for income is called employment and is often favored by the world. It is considered good to be hired. However, many young people mistakenly believe that they will be employed for life. The truth is that the average life expectancy is now over 75 years, and the average person may be employed for about 30 years in their lifetime. So they have to make 100% of their money 40% of the time.
Everyone born into this world is financially dependent on their parents. Most people don’t make major financial decisions until they turn 18. Today, however, many middle-class students take out college loans in order to continue their studies and prepare for the job market.
The field of personal finance is very broad. There are many experts with different opinions in the field of personal finance, and they exist side by side. In the early 2000s, however, a relatively unknown writer named Robert Kiyosaki started making waves in the field. Some of the ideas he presents are radically different from the beliefs commonly held by personal finance experts. That’s why his book “Rich Dad Poor Dad” has become such a controversial book. However, it also needs to be mentioned that those who read the book found some of the advice very valuable. That’s why this book ended up being a bestseller for years in a row! Robert Kiyosaki eventually acquired the Rich Dad Poor Dad brand and created a line of books, board games and other merchandise that are still popular today.
The name of the book Rich Dad Poor Dad is based on the conflicting education about money that Robert Kiyosaki received from his two dads. His biological father was a government employee, the poor father. Robert Kiyosaki believes that his poor father never made enough money in his life because he had some limiting beliefs about money. He used to think that having too much money was a bad thing and that people had to do unethical things to make a lot of money. Furthermore, he believes that money can only be made through labor. That’s why he often tries to negotiate better terms for his salary.
Meanwhile, Robert has the privilege of spending a lot of time with his friend’s father, whom he calls his rich dad in the book. Because Robert spent time with two people from two different social classes, he was able to compare and contrast their ideas. According to Robert Kiyosaki, being rich or poor is a matter of mindset, so a person must change their personal beliefs to become rich.
The book was popular because it gave ordinary middle-class people around the world a glimpse into the world of wealth and how they viewed it.
Most of the lessons taught in the “Rich Dad Poor Dad” series are somewhat unique. That’s because the book offers a new perspective on finances. In the book, Robert Kiyosaki explains that most people spend their lives trying to increase their income. He called it a “rat race,” where all the 9-to-5 crew worked hard and ended up getting nowhere. The answer, he argues, lies in spending patterns, not income. People with a rich dad mentality invest a lot of the money they make. So, in essence, they turn cash flow into an asset, which creates more cash flow. On the other hand, people with a poor dad mentality use the increased cash flow to buy more debt. More debt can be seen in the form of bigger cars, bigger houses, etc. As a result, their cash flow is currently depleted. Robert Kiyosaki explained that if a person spends all their money on liabilities and expenses, they will not get rich by making more money. Instead, a person becomes rich by investing money in income-generating assets. This concept has been explained in other books in the form of a concept called “saving rate”. However, Robert Kiyosaki presents it in an easy-to-understand format.
Robert Kiyosaki also explained how different classes of people make money. The poor dad mindset equates money with labor. That’s why the earning potential has become limited, he believes. After all, the hours a person can work is limited, so their earning potential becomes limited. On the other hand, the earning potential of business owners is not limited by the hours they work. They can make as much money as the product they sell. At the same time, investors can also earn unlimited funds according to the funds they invest. That’s why Rich Dad Poor Dad’s Robert Kiyosaki recommends that people try to transition from employee to business owner in their lives. This will help people maximize their earning potential.
Robert Kiyosaki believes in the first principle of paying yourself. In his book, he devotes an entire chapter to how the rich regularly save a portion of their income before they start spending it. He shares the personal finance gurus’ belief that if saving isn’t a priority, it’s never going to happen. That’s why he also recommends deducting a portion of paychecks before the balance is used to pay monthly bills.
Robert Kiyosaki wants people to actively invest all the money they save. He wants them to create a portfolio or passive income to supplement their regular income. He dedicates pages to his book explaining how people who don’t invest actually lose money. He explained that the savings rates offered by banks are actually well below inflation. So if money isn’t used, it just loses its value. He also explained how Richard Nixon took the world off the gold standard, meaning governments can now devalue currencies faster than people can earn them. His investment advice is considered extremely risky. That’s why Robert Kiyosaki is criticized by personal finance gurus.
Ideally, each worker should have an understanding of how different types of income can be used to create overall wealth. Surprisingly, however, many are not focused on generating secondary and tertiary income, and therefore cannot make the best use of their earning potential.
The importance of financial planning at the individual and family level cannot be overemphasized. For years, people and even governments have tried to instill this habit into the masses. However, they found it difficult to do so. This is because there are several common misconceptions people have about personal finance.
At the end of the day, financial planning is a complex discipline that includes retirement planning, tax planning, asset acquisition, and several others. Some of the courses offered by Robert Kiyosaki are both unique and valuable. That’s why many people follow his advice, even though mainstream personal finance gurus often discredit him.
(The author is Principal Manager, IAPM JK Bank, Zonal Office Mumbai)

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