How to Build Wealth With Assets, Not a Paycheck

0:00This is the Rich Dad Radio Show, the good news and bad news about money. Here's Robert Kiyosaki. Hello, this is Robert Kiyosaki. I'm very happy to be talking to you. And why I'm especially excited is because this is the most important thing you can do. There's nothing more important today than investing in your entrepreneurial education, your financial education, because as you know, the world has changed so dramatically. And I'm just glad I had a rich dad who warned me that this time was coming. You see, the world, because of America, is going into a serious decline. You know that, I know that.

0:45And it cannot be stopped. So the people that get wiped out are the people that are clinging to old ideas. The people that will do better are people that actually seek information, seek new teachers, seek new skills, and you will do well as independent business people rather than employees. Also, I think MC Ken Sapp and mentioned Richard and Veronica Tan of Success Resources. They've been my dear friends since 1996. So it's Richard and Veronica who first allowed me to tell the story of my rich dad and my poor dad. So I'll be talking to you today about what my rich dad taught me about business, about being an entrepreneur, and being an investor.

1:35And so this is another friend of mine. You probably know him as President Trump, and I know a lot of people hate him. We've written two books together because we're very concerned about education. You know, our schools have no financial education in schools. So whether you love him or hate him, he's very much pro-education. I know him, I know his family, I know the people he works with, his business. They're fantastic people. So please don't listen to everything you hear in the news or in the print and all this. You know, Trump does say some things that upset people. But my experience of him, he's a very, very good man.

2:13My wife loves him. He's a lot of fun. He's very smart, and he's straightforward. So anyway, this was the second book, first book, second book I wrote with Donald Trump. It's the Midas Touch, and it's for people who want to be entrepreneurs. So getting back to my rich dad here, I'll give you a few lessons. You may have, if you've read Rich Dad, Poor Dad, you've probably heard them before. But these are the basic lessons for those of you who want to be rich tycoons. And it goes to this. This is from rich dad, poor dad.

2:50This is the thing of a financial statement. What you'd learn in school is income, expense, assets, liabilities. Now, this is the difference here. My poor dad, PhD, good man, went to Stanford Northwestern University of Chicago. This was poor dad.

3:19All he wanted was a job. And that's, you got to get a good job. And they also wanted to keep his expenses low. This is live.

3:42So my poor dad's go to school, get a job, and then live below your means. That was his life. And that's not the life I wanted. This was my rich dad here.

3:55And this is what the rich do, is they acquire assets or they invest in assets. And the trick with Rich Dad was he used liabilities here so he could use debt to buy his assets. And what happened to my poor dad, he would use debt to buy liabilities. Very, very big difference. That small little distinction is the big difference. And so the reason I've made millions and millions of dollars, I use debt to buy real estate. So today I have about 7 ,000 rental units. And every month, 7 ,000 rental units put cash flow in my pocket. So I don't need a job. So I want to explain that again to you. So this was poor debt.

4:55And for those of you who want to be rich, you may want to get out of your mind the idea of go to school, get a job, and live below your means, because you don't get rich thinking that way. Now, if you're going to be a rich tycoon, you want to be here. You want to be able to be a person who acquires businesses. So I own a number of businesses. I own a lot of real estate.

5:22I have no paper assets. I don't want any stocks, bonds, mutual funds, or ETFs. Not that I'm against them, I just don't need to invest them. And the next one are commodities. And commodities are gold, silver, oil, Bitcoin. So the reason the rich are getting richer is very, very simple.

5:47And why what you're learning at New Tycoon, is to be here. If you're in school, you'd be like my poor dad, looking for job security, a steady paycheck. And what you're learning at New Tycoon is here. This is very important today because, as you know, the stock market is at all-time high. And the reason it's all-time high is because the U.S. government, the Fed and Wall Street, Federal Reserve Bank and Wall Street, are printing trillions of dollars. So that's why I've been buying gold since 1972. I bought my first gold coin in Hong Kong. It was a Krugerrand, South African Krugerrand. And I paid$50 for it.

6:41At the time I was flying off Vietnam, flying off of a place called Da Nang. And I was looking for gold in Da Nang and stuff like this, but I didn't get any. So I had to go to Hong Kong, get my first gold coin in 1972, and I bought my first silver in 1964. So the reason I'm a relatively rich man is because I never saved dollars. I don't save U.S. dollars. I save gold and silver and today Bitcoin. So if you're going to be a rich person, the secret to long-term wealth is found in the commodity section. So gold and silver and Bitcoin hold their value. So like I said, back in 1972, when I was in Vietnam, then I went to Hong Kong to buy my first Krugerrand.

7:32That Krugerrand was about$50 US in 1972. Today, it's about$2 ,000. And I have thousands of them. I just don't save dollars. I save gold, silver, and Bitcoin. This is where the rich get richer. and this is where the poor middle class get poor because they make a lot of money here and their largest single expense are taxes. So you have a job and you might go straight to the government. If I'm acquiring assets, I bypass taxes legally. So those are some of the simple reasons why the rich are getting richer. with this in my rich dad and my poor dad. And you look at this here. Debt made my rich dad richer, and debt made my poor dad poor because my poor dad bought a house.

8:34So very simply, that's it. I mean, you don't have to know much more than that. So if a picture's worth a thousand words, let me show you this picture here. So this is the picture here. This was rich dad. he really valued his financial statement. And this here is a financial statement. And this is what Poor Dad valued. He valued his college degree, his PhD. And the reason Poor Dad was poor was very simple because this is what he thought was important, this. And this is what Rich Dad thought was important here. So the second book in the Rich Dad series was this book here, The Cashflow Quadrant. So Rich Dad, Poor Dad was number one.

9:15And the Ted Perdeaux is about this.

9:21And this is the cashflow quadrant. Many of you have read it. It's a very important book. But these are the four different people that make up the world of business.

9:36This is the quadrant. E stands for employee. That was my core dad. S stands for specialist or small business owner. You know, somebody who's like your plumber or electrician or a doctor or a lawyer. But this is where a rich dad hung out at. So again, poor dad thought this was important. My mom thought this was important. My mom wanted me to be a doctor, a specialist, but you have to be smart. And I'm not very smart. So she said, I can't be a doctor. So I came over here, and this here is Rich Dad. These guys always use the same words. You know, they'll always say, I need a college degree. I'm looking for a high-paying, safe, secure job.

10:33These are the people that are being wiped out today. Jobs are lost and lost and lost. So are these guys here. The ripple effects, it's like one guy loses his job, it affects his family, it affects businesses, it affects everybody. You're gonna learn to be over here. You're gonna learn to be an entrepreneur and an investor because that's the secret to success today. Not job security and not being a doctor or a lawyer. There's another reason. This word here, Francis. These are E's and S's. they pay the highest taxes

11:14so this guy over here the poor person in America and it's true most of the world they'll pay about 40 % in taxes in America these people pay 60 % in taxes and in America and the rest of the world these guys pay 0 % I mean excuse me 20 % and the investors can pay 0 % taxes legally. So this is all part of your financial education because education is what makes you rich, not money. You're not making a lot of money because there's a lot of people make a lot of money here, but it just goes out this way. That's silly. That's really, really silly. So the object is to make a lot of money here and keep the money coming back here.

12:07That's how you get richer. But if you make a lot of money here, again, just pay higher taxes because that's what traps the people in the E and the S. But that's a big part of your financial education is you've got to know that this here is more important than a job. And the thing I like about this, you know, I'm an old man now, but I've been collecting gold and silver and Bitcoin for years. It doesn't take any intelligence. It just takes discipline. So sometimes I buy one coin. Sometimes I wait a while buying more. But that's what made me rich. On top of that, I have businesses. And the way I really made the most money was in real estate.

12:51The reason I take real estate is I can use debt to buy real estate. I don't have to have money. That's the difference. And the more this real estate puts money in my pocket, the less tax I pay. That's the game. So my real estate, the 7 ,000 rental units, make money here. But because of tax law and accounting rules, I don't have to pay the taxes legally. And you can do the same thing. Just have to have a good accountant and a good tax attorney. You'll do very, very well.

13:30Welcome back. robert kiyosaki but one so one more very important lesson is this is every human being every for every human being has four intelligences one is mental

13:48i was never very good there another is emotional

13:55you know the reasons people are not successful is because of fear Our schools teach you don't make mistakes. It's the fear of failing. To be a new tycoon, you've got to overcome that fear of failing and do that smartly. So, emotions are important. So is joy. Happiness is also an emotion. And sometimes people make stupid mistakes when they're really, really happy. The other type of education or intelligence is physical. You know, if you're learning to play golf, golf is mental, emotional, and physical. Like, you can't learn to play golf if you're not good physically. So, you've got to improve that intelligence.

14:42And the last intelligence, which is the most important, is spiritual intelligence. And that's what keeps you going to overcome any doubts you have about yourself and all this. There's a thing called self-esteem. And if you're going to be successful as an entrepreneur, your self-esteem has got to get stronger. It's your self-perception, that's what's going on inside of you, gets stronger, then your success goes up. But money alone, just making more money, doesn't necessarily make you more successful. So the more you focus on getting these intelligences stronger, you become more successful. And that's a long way of saying, and that's why my wife and I, Kim, created this board game here, the Cashflow Board Game, because the board game is not just mental.

15:42The board game involves mental, emotional, physical, and spiritual. And the great thing about the board game is you can play with playing money. And the reason many people are not successful, their fear of losing money is so high, they can't think. Like this does all of their thinking. And what happens is when you get really emotional, you freeze up. So the purpose of the cash flow board game is to give your spiritual strength time to get stronger. So you get stronger physically, mentally, emotionally, and mentally. But that's what you're learning about right now. One of the reasons my poor dad was not successful is he couldn't control this here.

16:27He was so afraid of failing. He was so afraid of not having a paycheck. He was so afraid of it. And so that's why he stayed an employee. So the reason my poor dad got stuck, and he got stuck here, and he got stuck here, was because he was really smart mentally, he was good in school, but his emotional intelligence was very low, which froze him here, and he didn't have the courage to leave this place and come here. Your job is to get emotionally more intelligent. We all have fears. We all have doubts. We all get depressed. But your intelligence will overcome that. You have to know the language of money, know what finances, business, and all this.

17:29You have to learn how to sell, how to talk to other people. is if you can't sell, there's no income. But most important is your spiritual intelligence. It's how do you fall down and stand back up? When you fail and you fall down, if you don't stand up, this, you don't get smarter here. But if you have the strength to stand back up, you get smarter here. So that's the reason my wife and I started the Cashflow board game was very simply so you could engage all four intelligences. Well, let me show you where that works out to.

18:12So this is kind of the game board here, instead of the game. But this here is your financial state. And what the game is teaching you to do, and what you tycoon is teaching you to do, is to focus here, in essence. Because this is the most important thing. This here is your statement of cash flow. So this ink statement, this is your balance sheet. So this is all financial literacy. And most school teachers are not financially literate. They don't have one of these. So if you're going to be an entrepreneur, you have to have one of these. If you're an employee, you don't need these things. So that's why I know some of you don't like the guy, but President Trump and I, why we join forces is, to be successful in life, you need all four intelligences.

19:04You know, he takes so many people hate the guy. They really hate him. And I know him as a good man. He gets accused of everything. But if he's not really strong here, he could never be president. So I'm not saying you should be president of the United States and all that, but if you're going to be successful in life, you know, every day as you get older and work and learn and all this, You want to get more successful and more intelligent physically, mentally, emotionally, and spiritually. Like a lot of people my age today, all they had was a job and they played it too safe. Now they have no money.

19:42They have to retire, but there's no money to retire on. It's because emotionally they played it too safe. They're afraid of failing. And they're afraid of losing money. that's not good mental intelligence here. So please remember this, it's all four intelligence is required to be successful today. And the spiritual intelligence is the most important because when you fail, spiritual intelligence gets you to stand back up again. And so part of your four intelligences, a lot of times I like to use pictures because pictures involve your right brain. You know, a picture's worth a thousand words. So take a look at this picture over here.

20:26One of the reasons my school teachers are not rich is they only teach you to see one side of a coin. They say, either you're right, I'm right, you're wrong, and I'm right, you're wrong. If you're going to be intelligent, you have to see both sides of a coin because all coins have three sides. One side is heads, other side is tails, but intelligence is standing on the edge of the coin and looking at both sides. So there's a lot of people that really hate Trump, but they don't see the good things he's done. I'm not pitching Trump. I'm just telling you, they're so blinded because they hate him so much.

21:05Or a lot of people are so afraid that they can't see there's millions and millions and millions of dollars and opportunities in front of you. All they see, oh, the economy's bad. Oh, the economy's bad. But on the other side of the coin, the economy could be great. So the real test of the four intelligences is not whether you're right or you're wrong. The real test is can you stand on the edge of the coin and then see both sides. So, you know, right now, the economy looks really bad for millions of people. But on the other side of the coin, the economy is really good. which also you can stand on the edge and see where the economy is bad, but sometimes where it's bad, it's the opportunity.

21:57Like right now, I'm making more money than ever before because people want financial education. Now, if the economy is bad for you, then all you have to do is engage your intelligences and see the other side. That's one of the most important things. The reason my poor dad was poor was because he had his PhD. And, you know, in school, you have to be right, and everybody else is wrong. That's what PhDs do. If you're going to be an entrepreneur, it's best you see both sides of the coin. The opportunity is found in darkness. And if everybody's doing it, I don't know if you want to do it. Like, you know, Apple is one of the biggest stocks.

22:43I should have bought Apple years ago or Amazon, but I didn't. But there's still more opportunities than ever before because I can create my own opportunity. I can create my own assets. So those are some of the things I'd like to have you understand here is don't get stuck in the right, wrong, and all this. You have four intelligences, but the most important intelligence is to stand on the edge and see both sides. So the next time somebody tells you you're wrong, just know they're saying they're right. And your challenge is to know why what they think is wrong is your right. You've really got to see all three sides.

23:24And all three sides require all four intelligences. One more thing about intelligences.

23:35These are markets here. You know, there's an old saying as an investor in the I quadrant is that the bull goes up the stairs and the bear goes out the window. So what happened is, up until 2020, the world economy was doing really well. Then in 2020, the bear and the market crashed. Again, going back to these four intelligences, what you want to see is in the crash is to crash good or bad. while the facts are crashes are good and bad. There's actually more opportunities in the crash. This is what's happening to the world economy. What in my reality is, I'm going to make more money on this side.

24:28I see more opportunity, although these people here see nothing. So those are very, very important points about being an entrepreneur. Remember, bulls go up the stairs and bears go out the window. We're going out the window. If the U.S. is in depression, some of these people will be really big losers and these people will be big winners. But it's the same depression. And you, as part of the U. Entrepreneur, you have this choice. Do you want to see the depression as the worst thing that happens to you or the best thing that happens to you? So that's why I always just say it, and I'll say it again, because I'm into education.

25:11Not the garbage, not the kind of education these guys study. These guys only know this. They're very smart people. My poor dad was very, very smart, but he was terrified. He was so afraid of losing that he was frozen here. He was paralyzed here because he didn't have this. so the problem with most people who go to school they're very successful here this is all they got but what my rich dad had he had his financial statements and he knew he was doing good or bad right or wrong so once again let me say this here the bull goes up the stairs we've been going up the stairs since 1971 we're going into the biggest crash in world history and you are the best place you can be.

26:06Because when this comes down, there's more opportunity here than here. Let me say it again. There's more opportunity here than up here. But you have got to prepare your mind, your emotions, your physical, your spiritual intelligences to take advantage of the whole thing.