Why A Students Work for C Students - Robert Kiyosaki

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1:18In other words, A students work for these guys here, okay? And B students, well, they work for the government. You know what I mean? These guys here are really, really smart, and these guys are not smart, so they become executives and bureaucrats. That's what it stands for, okay? And then the real capitalists are the entrepreneurs out here. So it's a slap in the face for many A students, you know? well, my kid doesn't get a good college degree, so what? You know, in today's world, you can still be rich. You know, so today we have the Rich Dad advisors, or I call them my team of capitalists, because they're all A students.

2:03And so you'll be hearing from A students, but they're repenting for their sins, and they're learning to be C students, or capitalists, right now. and so before so going on I'm not saying that's going to school is not important but what happens for people is there's academic education and most a students are a students here so this is k through 12 in college and then what happens depending upon how well you did here you become a professional so the a students could become doctors and lawyers and accountants so what you'll be hearing from or my team of advisors who are doctors, lawyers, and accountants, the A students.

2:45And then there is financial education. But our schools don't have any of this who don't believe in financial education. So it's academic, professional, financial. This is the biggest lesson of all. Just because you're not an A student and because you're not a doctor or a lawyer doesn't mean you can't be rich if you have a good financial intelligence. So as you're playing the cash flow game and looking at all this, You notice in there, well, this is the cash flow game. Okay, this is it. As you're playing the game, you notice there's a thing called profession. And that's this here. What you find out, it doesn't make any difference.

3:28In fact, it's harder for the doctors and lawyers to get out of the rat race than a janitor. So all of you guys out there who say, well, I didn't go to college, you know, and I'm a janitor, I'm a dishwasher, I'm a waiter. It doesn't make any difference if you have financial education, and that's why we created the cash flow board game that you can actually get out of the rat race and get on with your life. But one of the biggest problems I had with academics is I was a C minus student, a D plus, a C minus. But the good, I was fortunate that I went to a great school for professional education. I went to the US Merchant Marine Academy at King's Point, New York.

4:09When I graduated from King's Point in 1969, we were the highest paid graduates in the world because we had great professional education. I had great professional education as a ship's officer. And if you sail to Vietnam in 1969, you made about 120 ,000 a year tax-free, but you had to stay outside the boundary for 18 months. So we were the highest paid graduates in the world, except that, not being the brightest guy, I being a C student, I joined the Marine Corps and made$200 a month. So instead of 10 ,000 a month, I made$200 a month. I didn't have to worry because I had this education from my rich dad.

4:49So today we're gonna be talking to my A students. These are my real A students. We all work together as a team, come from different disciplines, different professions. So I'll start with Tom Wheelwright. Tom, would you give us a little your background? Tom is the author of the book, Tax-Free Wealth. And if there's really a book on how capitalism works, it's in Tom's book, Tax-Free Wealth, because these guys here often pay the highest taxes and these guys pay zero taxes. Am I correct, Tom? No, that's exactly right. So I have an undergraduate degree in accounting from the University of Utah. I was an A student there.

5:29And then I went to the University of Texas to get my master's in professional accounting. The reason I'm laughing, the Rich Dad organization is the only organization where people choke when they say, I'm an A student. Because we have so many guys here or here, and they don't give a shit. Like Kenny McElroy is the worst. His license plate says C student on it, on his Ferraris. So that's why Tom kind of chokes, I was an A student. So this is the only organization, right Tom? It's almost embarrassing to say you're an A student. Yeah, you have to basically say you're recovering a student in this organization.

6:06But I do have a master's of professional accounting and from the University of Texas, I specialize in taxes. I spent seven years with one of the big accounting firms, Ernst & Young, including three years in their national tax office. I spent four years as the in-house tax advisor for a Fortune 1000 company. And the last 25 years buying, building and selling CPA firms. and teaching financial education from a tax side. So I did love the academic side. I love the professional side. And the most of all, I love the financial side. And it's the hardest one. And what I'm an honor is that when I met Tom, I mean, 20 ,000 years ago, when dinosaurs roamed the earth, what I was thrilled about, you know, Tom's an eight student, he's way up there in the world of accounting.

6:53You know, to work for a big eight accounting firm, it's incredible to be an instructor at a university in accounting. He's definitely an A student, but you use this cash flow game to teach to other accountants, right? Is that correct? I do. I use that. Every time that I teach a group of accounting professionals, CPAs, I use the cash flow game to teach the different financial statements. And I use it to teach entrepreneurs as well, because when it comes down to it, financial education starts with the financial statements. And that's That's what I love about Rich Dad Poor Dad. That's what I love about the cash flow game.

7:32Thank you. So as you guys are playing this cash flow game, I want you to keep this in mind here, especially if you're the janitor. You know, what that should rattle in your brain is that, why, you know, what don't I know? I mean, just because you're not making any money doesn't mean you can't be rich. So that's the whole purpose of the game here. So Mr. Sutton, my account, my attorney, I'm not a kind of, So generally in businesses, attorneys and accountants speak different languages. They don't necessarily get along. Is that correct, Garrett? That's true, Robert. You have legalese and you have accountingese, I guess, and never the twain shall meet.

8:12A lot of accountants just don't understand the legal side of things and vice versa. So it's important to have on your team people who can communicate properly with each other. And Tom and I have mutual clients, and we're able to communicate on the financial side of things and make sure everybody is working together. You have a team of an accountant, an attorney, and the client who is engaging in building their net worth. And that's our job is to help them do that. And to do that, we need to communicate properly. Correct. And Tom, would you agree with that? A lot of times it's adversarial between accountants and attorneys, even for the same client.

8:54Oh, for sure. It's the blame game, right? The accountant blames the attorney. The attorney blames the accountant. They don't talk to each other. It's actually one of the best things about working with Garrett is that we talk to each other all the time. And we just learn that, boy, you get a lot more done when you talk together and with the client and they're all on the same team. Right. And so be aware, Garrett says, they speak the different language. That's not a mistake. You know, you'll find that education was - Yeah, and so many times - What was that? So many times, Robert, you'll have the attorney say, well, that's an accountant question.

9:31Call the accountant. And the accountant says, no, that's a legal question. Talk to the lawyer. And you're playing, the client's playing ping pong. Right. Instead, you want to get everybody at the same table on the same phone call and get all the questions answered so the client can move ahead. So Garrett, what's your background? I mean, you went to the most prestigious law school on the West Coast, in my opinion, you know, what's your back education? How did you do here and here? Well, I went to the University of California at Berkeley and graduated and then went across the bay to Hastings Law School, which is the University of California's law school in San Francisco.

10:09And the thing I found is when I became associated with the Rich Dad Group is I never learned financial education. They didn't teach it at Berkeley. They didn't teach it at Hastings. And like so many other professionals that want to advance their own net worth, you have to learn the financial game outside of college and law school. And so it's been great going around with you. My kids have learned from you, Robert, because they're going to professional schools now, too. But they know that with the professional education, they need the financial education. That's just as important. Thank you. And what are your children?

10:51What profession are they studying? Well, Ted is at the University of Wyoming Law School. So he's in law school. Sarah is at the University of Nevada Med School. so she's going into medicine, and Emily is getting her master's in finance from Santa Clara. So all three of them are going the professional route, but they also, thanks to you, Robert, know they need the financial education and know that they have to invest in real estate as they get older. Or they don't have to, not real estate, but they have to understand investing, the tax loss and all that. So that's Tom's rule. Okay, so that's the whole thing here.

11:30Schools divide us. And by the way, we have a video, it's about this, it's a cartoon about how the king maintains power. So go to the Rich Dad website, it's a beautiful cartoon. It's about how the king maintains powers by dividing. So again, they divide people here, but the king maintains power here. And it's a very important video to understand the differences. So we have Dr. Nicole and Dr. Radha. Nicole, you can see all those degrees at the back of your... So give us your background, Dr. Nicole. Sure. So my graduate studies, my master's, my doctorate, I went to Georgetown University. So I went to one of the top schools.

12:25I worked for Mayo Clinic Hospital as an employee. And, you know, I had great education, worked for a great establishment. But something that I realized early on was that I learned how to treat disease. I wasn't really doing anything to promote actual health for my patients. And so that's what started to drive me into, you know, getting out of being an employee where I called myself a robot doctor. You know, it was just this criteria of things that you had to meet. It was nothing about personalized medicine. And so that's what drove me to want to move from the E quadrant to the S quadrant. And, you know, just as as Garrett mentioned, I was so fortunate to be surrounded with a group of you, you and the other advisors to give me a financial education so that I could make that transition and really allow my spirit to drive what I wanted to do for individuals.

13:23And that's when I started my practice, Ultra Healthy Human, where we focus on high performance health for high performance people. So we're using cutting-edge technology, anti-aging techniques, and personalized care to slow the aging process. So my goal was to truly promote health for patients, not just treat disease, as I was doing as an employee. And I am, you know, myself and Kenny and Blair, we're all clients of Dr. Nicole. And people say, how come you've lost so much weight and how come you're looking younger and why are you healthier? it's because I stopped worrying about diet and exercise, and I started focusing on health, but as Nicole says, cutting edge health, cutting edge technology that's coming in today, but unfortunately, this technology is not covered by insurance.

14:17Is that correct, Dr. Nicole? Right. So it helps to be rich, because you can look healthier, younger, live longer, and look better. So that's the big thing. And here is Dr. Nicole's fiance, Dr. Rader Gopalan. Dr. Rader Gopalan I met because he's my cardiologist. I was born with a preexisting condition called heart disease. And about 20 years ago, I met Dr. Gopalan and he was the attending or he was the advocate. He watched the surgeons cut on me because he is a cardiologist to make sure that he didn't put a pig's heart inside my chest or something like that. But then we've become really best friends.

15:00He's the author of the book, A Second Opinion. And the beauty of Dr. Gopalin, he is both East and West medicine. He's a doctor of cardiology and heart transplant specialist, but he's also a doctor of acupuncture. So that's where we get along so well is because I'm not just in one area. I can talk to Dr. Gopalin about Eastern medicine as well as Western medicine. So Radha, what is your background and then you're an A student here and all this, but you have many, you're a doctor of cardiology, but also a doctor of acupuncture. Is that correct, Nussin? Yes, yes. My background, Robert, is I was born in Sri Lanka, born and bred in Sri Lanka, then went to Medsport, and then completed all the way here in the United States, and then finished my training here and became a cardiologist, which is specializing in heart disease.

15:52So as you can see that, you not only become a professional in medicine and then you sub-sub-specialize into a one focus of one organ among all the organs of the disease so you are kind of fine-tuning your skills but fortunately I was gifted with an opportunity to to be exposed to eastern philosophies through acupuncture when medical schools closed in Sri Lanka that kind of opened my eyes to what I actually come to love and believe in is health and not disease so at the time i was exposed to it i was at medical school learning everything about disease um and then when i went to the acupuncture school they were not talking anything about disease at all nothing that's interesting even though patients came with disease complaints they did not talk about it so that's that opened my eye to the health side of it in fact actually i grew up in ayurvedic tradition it's it's all about health oriented, but I never realized it was all about health because it was a lifestyle.

16:55So you just don't associate the lifestyle with health at that time. But it became clear when I started focusing on disease and came back to health that what it meant and why health is important. And then I have just been at a few major institutions in the United States, building cardiology programs and practicing cardiologists and try to combine both the Eastern and Western philosophies of medicine. Yeah, and so your book is a second opinion. It is a blend of East and West medicine and how that's health. But you also said that Western medicine is also not healthcare, but wealth care. And that's why I make the statement that many of the procedures that Nicole performs are not covered by health insurance.

17:44Have you noticed the same thing, Dr. Capellan? So, I mean, I think if everything runs on money, and as Garrett said, in med school, I was never taught about finances. You are only taught about one, disease, and then two, how to recognize it, three, how to treat it. That's it. It was never about making anybody healthy. It's about making, it's about treating people. But it runs, I work as an A student. And as you pointed out, I work for the C guys and the corporations and health system and get paid a salary. And I take a paycheck and go home after doing what I'm expected to do. But the interesting part is you are never taught about finances or personal finances or how to be successful.

18:26So I was trying to make a paycheck. My paycheck may be different than somebody else's, but it is still a paycheck. I have to continue to work in order to get the paycheck every month. So until I am well into my middle ages, I never realized anything about the C students and the financial system that you have been teaching. And I was fortunate enough to come into that circle and learn, begin to learn. So in other words, as Tom said, I am kind of undoing my academic side and becoming more and more C-side as a C-student. It's hard. It's very hard. Once you are fully trained, as you correctly pointed out through school system, to believe in one thing, to undo that, to become another is harder.

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21:11you say well i can't be rich i can't be successful because i wasn't an a student here so a lot of times in elementary school these people become the a students in you know you know they're the ones who become doctors and lawyers and things like this whereas guys like myself and kenny and andy tanner we we didn't do well here you know we're all c students and i was a d minus student most of the time but because i had capitalist education my rich dad taught me here that said well i don't really i don't really care about the money because i can make it here and that's how this when you're playing the cash flow game and discussing things like this keep that in mind because a lot of people i hear a lot of people say well i can't be successful because i didn't go to college and when you look at the on the cash flow game here it's what you're profession.

22:08And that's the correlation here. You'll find out you can be a janitor and still kick the butt of a doctor if you have financial education. So Tom, any comments on that? Because you see the financial statements of many, many entrepreneurs, right? I do. And the really successful ones are always those who really focus on the financial. You know, they may earn money as a professional, but where they put their money is on the financial side. They recognize that it's the assets that are going to create the income and the cash flow. It's not their job because they don't want to work till they die. They don't want to do that.

22:51They don't want to be dependent. Like Rada says, you know, a big paycheck is still a paycheck and you're still dependent on it. Those who are really successful have made a transition. Even if they retain their professional job or their professional career, they've made that transition into the financial side. And if those who don't, I was talking to a very well-known dentist the other day. He said less than 3 % of dentists retire financially secure. And that is just shocking when you think of how much money the dentists make and how much time they have. I've seen dentists, though, for example, who make that transition to the financial side, and they're wildly successful.

23:33So it really is all about the financial combined with the professional to get you where you want to go. Right. So what Tom is talking about comes from this here, and it's my rich dad's cash flow quadrant. So what happens is you either come out as an employee, but a lot of times what people will say, Oh, he's a doctor. He makes a lot of money. And that's why my mom, my poor dad, just wanted to be an employee, get a secure job. When he found out I graduated from Kings Point in 1969, the highest paid graduate in the world, he was happy as Larry. He says, oh, my stupid son finally did something. And like I said to Dr.

24:16Nicole, I got my diploma and I lost it within 10 minutes. I've never seen my diploma since. the day I graduated. I don't know what happened to it. I think somebody stepped on it. You know, because at military school, I don't even say that you throw your hats in the air when you graduate. Well, I think I threw my diploma in the air instead. I never found my diploma again. It was just kind of my attitude problem towards the whole thing. But my mom wanted to become a doctor. And as Tom explains in his book, Tax-Free Wealth, Tom, how much in tax approximately, this is worldwide, does an employee pay?

24:50About 40%. And this is worldwide, right? Right. How about doctors and specialists? About 60%. Big business? 20%. And I's? Zero. Zero. So this is all financial education. So although I wasn't gonna make it here because I was not very smart, I knew this is where I was gonna migrate to. So the Rich Dad Company was based upon, if you stay here, fine, you're happy here, fine. But it was for people who want to migrate over here. So when I met Nicole, and I pointed this out to you, here, here, I mean, the thing I love about Nicole, I mean, being an A student, and she's very smart and very bright. Nicole, you're migrating over here right now, right?

25:47Yes. And so your business is called Ultra Healthy Human, high performance health for high performance people. I am a patient of Dr. Nicole and her stuff works, Kenny is, Blair is, Kim is, because we don't want to look fat, old and ugly, right, Dr. Nicole? Yes. So what are your thoughts as, you know, you came out, you come out as an A student from Georgetown. What have some of your peers done, your classmates, What's happened to them? So they, I think everyone that I went to school with became employees and I hear them constantly complain about their job and how much they're restricted as practitioners.

26:30And, you know, some of their, you know, a lot of people in healthcare go into it because they're like, I want to make a change. I want to help people. But then when they become employees, they're, they aren't able to, all they're doing is, treating symptoms and not doing anything to help people stay young or carry out what their spirit drove them to go into that profession for. So I went against the grain and I said, even though I didn't at the time have that solid financial education, it was my spirit that drove me to, I want to do what's right for people that want to slow their aging process, who want to be healthy, who want to be fit.

27:11And so that's why I moved it to the S quadrants. But then now I'm at the level where I'm trying to move to the right side of the quadrant. And so one of the best lessons that I learned was buy the real estate that my practice is in. So once I did that, my business paid for my real estate. So now I'm accumulating assets, which it's great to have assets, but then also the tax benefits from it it's it's amazing because now i can take those tax benefits and reinvest it into my business to continue to grow and keep that cutting edge technology coming coming into the practice so that i can pay it over to my patients and have them continue to um benefit from these services so what's what nicole what happened to nicole she didn't want to become an e right so So she started her business, but now, and then she acts as an investor, she's buying her property.

28:12So the business is buying her property, it means her taxes go down. So she's making more money, paying less taxes, and she's building a brand, B stands for brand. And what's your brand, Nicole? Ultra healthy human. And who is your brand for? High performance health for high performance people. Right. And what that does is defines her customer. So what happens then, that's where Garrett kicks in, Because, Garrett, now why does she need you? Well, she's accumulating assets and she needs to protect them. And how does she do that? Through setting up LLCs and corporations and in some cases trusts. But Nicole's to the point where she needs legal assistance to protect her assets.

28:57Correct. Because if she didn't cover her real estate and she didn't cover her business and she didn't cover her brand, what would happen? Well, she's in the medical practice. You can get sued for malpractice. They have a personal claim against you. If your assets are held in your personal name, you lose them. Yeah, it's a high-risk profession. They make a lot of money, but it's high risk from the legal side and from the tax side. Is that correct, Tom? No, absolutely. I mean, really high taxes. What Nicole's done great is she's listened to her teammates and learned that, okay, if she moves to the I quadrant, she's going to get a lot more tax benefits from the S quadrant.

29:37But this is the funny part. Nicole is the A student and she's listening to C students over here. Like Kenny and Andy and myself, you know, I mean, that's, that's the synergy there. What do you think, Radha? Are you proud of Nicole? I mean, she's really smoking along. I mean, I mean, the boys love working with her because she's so smart and pretty, but she's moving fast over to here. What do you think of that as a professional, as a medical doctor? Absolutely. I'm very proud of Nicole's progress in a very short time. Quick grasp of the finances. And I think one of the reasons I should say, and I think Garrett and Tom might agree with me, is that the longer you stay as an A student, the harder and longer it takes for you to undo yourself and get back into the seaside.