Is "Rich Dad Poor Dad" a Fraud?

https://economistwritingeveryday.com/2024/02/13/is-rich-dad-poor-dad-a-fraud/

by spking • 2 years ago

104 233 2 years ago

katzinsky• 2 years ago

I haven't read his book but I've watched my parents try to follow his ideas and I'm worried they're going to bankrupt themselves. They're not dumb, my dad has a much more successful career as an SWE than I've had (at least so far) but he's never been great with investing his money.

There are so many bad ideas out there. You really have to be discerning. I don't really know what else to say but I'm glad I never expected an inheritance.

EDIT: I'm out of comments for today but they encourage leverage (specifically with mortgages) without really talking about how VAR works. I'm not sure if it came from the author or somewhere else but they have this really bizarre idea about how real estate markets work. The models he comes up with flat out don't sound like viable economies to me.

sumtechguy• 2 years ago

The advice out there is all over the place. I use the Warren Buffet advice. 'if I cant understand it I dont do it'. The problem is many people fall into the trap of 'i am smart at XYZ so therefore I am smart'. For me excel has save me many times from doing some really dumb things. Just put the numbers in. Do a 'everything is good' role and 'everything is bad' many times you will be surprised on how those numbers pop out. After the beating the market has taken for the past few weeks I bet there are many people who are now at 'margin call' having borrowed against assets that no longer exist.

01HNNWZ0MV43FF3• 2 years ago

I've been happy with my "get rich slow" scheme on stock indexes the last 7-ish years.

the beating the market has taken for the past few weeks

Yeah I saw someone on Fediverse say the stock market was crashing too. I held through 2020 so... No this is really not a crash, I wouldn't even call it a beating. I have drastically slowed down my investments the last 4 years both because of COVID and because I'm saving cash for something special I want, but I'm planning to get back into regular contributions soon.

epolanski2• 2 years ago

What bad ideas are in the book that could bankrupt your parents?

Don't buy stuff you don't really need and invest your money is really not a way to bankrupt.

CommieBobDole• 2 years ago

'Invest your money' is a great way to go bankrupt, if you choose bad investments.

arresin2• 2 years ago

It’s so insulting low effort BS that it’s almost sneering. I really don’t understand the phenomenon. I’ve had people earnestly recommend it to me as an “amazing book”. Is it the catchy name? (This is my strongest theory).

abirch2• 2 years ago

I like the book's message much like I enjoyed The Four Agreements; however, they both could have been a magazine articles instead of books.

My takeaway from Rich Dad Poor Dad is think about ownership and value creation instead of working for wages. I religiously follow having my assets buy my luxuries.

arresin2• 2 years ago

Hey hey, no way does it deserve to be put in the same class as the four agreements. That’s legit.

passion__desire• 2 years ago

Here's a food for thought. Many people aren't that well read or critical thinkers, they just lap up anything served to them in a book. If many people are recommending something, consider it passing through your well-hardened filters/firewall.

PaulHoule2• 2 years ago

It scratches the same itch as Amway. It legitimizes the economic system for some people who want to believe there is a special path to riches for them.

The bit about getting a mortgage on a rental property and charging enough rent to make the payments, pay the property taxes, pay some property manager to fix leaking pipes at 2am, and make a positive cash flow is a hoot. Just try that.

immibis11• 2 years ago

It may have worked when the book was written. The evidence for this would be all the profitable landleeches around us who successfully get rich for doing very little. The people who followed this advice are the reason why housing prices are so high and the advice no longer works because they are so high.

However, the economic environment tends to change to cancel out things like this, in the long run. Look at the recent adjustment in the yen carry trade - the one that was blamed for the stock market crash last week. Lots of rich trading firms were borrowing billions of dollars in yen, at low rates, lending the dollars at high rates, making a profit in yen. However, after many years of this, the price of yen adjusted 12% overnight and wiped out all the profits and then some, from the firms that were still doing it. They had to spend all their dollar profits to get enough yen to pay the loans back. (They could have continued the trade, but the movement spooked them as the yen's value wasn't as stable as they thought and further movements could cause even bigger losses)

In the mortgage/rental scenario, this correction happens when the housing market declines, due to governments no longer preventing the necessary new construction of dense housing complexes. A tipping point will eventually be reached where landleeches are exiting their positions to cut their losses, causing prices to decline further causing more losses to remaining landleeches, who exit their positions to cut them.

forgetfreeman10• 2 years ago

Yeah I never totally got how anyone ever thought that shit was possible. I will say though that having rental property that you own outright is fantastic. Depreciation by itself is unbelievable. I'll make more than the initial purchase price of the property just in tax refunds.

immibis11• 2 years ago

The human mind cannot tell between acquiring new mind-expanding knowledge and acquiring mind-expanding-knowledge-shaped nonsense. We use heuristics to evaluate the quality of input and heuristics can be fooled by adversarial agents. Because the mind can't tell the difference it gives the same pleasure response to both, but the nonsense is much easier to create and wins the race to the bottom.

It reminds me of the way people use LLMs where people can't tell the difference between a good answer and good-answer-shaped nonsense. See this guy's attempt to replicate neetcode.io with an LLM and the neetcode creator's response. The LLM user seems to have fooled themselves into thinking their LLM output is a useful step on the way to recreating neetcode, when it is not: https://www.youtube.com/watch?v=U_cSLPv34xk

paulryanrogers2• 2 years ago

TLDR: yes

"If Books Could Kill" also did a critique for those who prefer to listen to a podcast.

I found the book appealing as naive young person. Yet so little of its advice was within reach to me. And the house I bought was a modest net loss compared to rent I would've paid. It boils down to buy cheap real estate and antiques that will be desirable in the future. I.e. be born in the right place, right time, to not too poor people, and make lucky choices. Also financial fraud wherever you can get away with it.

bsuvc• 2 years ago

I haven't read the book, but does it really say this?

He also tells of how he can back out of contracts by inserting a clause “subject to the approval of my partner”, where said partner was actually his cat. That is called “fraud”.

How can you take anyone seriously who does a thing like this?

bitexploder• 2 years ago

It is the sort of advice people who will never be in those positions hear and think it must be part of how rich business people operate. It is basic knowledge porn, like Malcolm Gladwell books, but with less sophistry.

silverquiet• 2 years ago

From what I've learned about how rich business people operate, they don't even tend to bother with contractual shenanigans like this; if they perceive that they have the upper hand in a situation, they'll just effectively say, "fuck you, I do whatever I want".

red-iron-pine4• 2 years ago

Malcolm Gladwell at least references actual studies -- there is a lot of hype and "science news reporting" BS in there, but there are at least kernels of ideas.

Kiyosaki is basically just making stuff up.

immibis11• 2 years ago

Every currently rich person has done a million fraud-like-but-maybe-not-actually-fraudulent things like this and that's how they're rich, so it's not completely insane. You definitely don't get rich by staying within the white painted lines. This particular one is more on the insane side of the spectrum... but do you remember that Elon Musk had a large golden parachute contract at PayPal, meaning they had to pay him a lot of money if they let him go, and then he made really stupid decisions so they had to let him go, and give him a lot of money?

taneq• 2 years ago

This seems unwarranted. Even if many rich people grifted their way into that position (for whatever definition of 'rich' you prefer) some proportion will have ended up that way through a combination of skills and luck without actually acting immorally.

chacha102• 2 years ago

Every currently rich person has done...

That's a pretty broad statement to make, especially with the implication that the only way you can become rich is by basically committing borderline fraud.

If you want to get rich, spend less, save and invest more. Nothing about that is fraudulent, and many would argue you'd have a more fulfilling life in the process.

space_oddity5• 2 years ago

While some wealthy individuals might employ unconventional tactics, it's crucial to distinguish between bold strategies and unethical behavior

mewpmewp211• 2 years ago

What about a case where someone makes a SaaS app and sells it B2B, becomes millionaire through it?

UncleMeat• 2 years ago

Yes. He really does say this.

He also encourages people to attend finance seminars and get involved in network marketing.

The audience for most personal finance books are people with absolutely no experience with personal finance. People with no experience read a book, conclude that it is filled with expert advice, and then recommend it to others. You kick this off with things like an Oprah episode and the momentum carries itself.

wickedsight2• 2 years ago

His podcast was recommended to me by a colleague. I listened to a single episode and realized it's just the ramblings of a guy who made money with zero concrete advise on how to do it yourself. And of course tons of complaints about taxes and regulation.

citizen_friend6• 2 years ago

Seminars were important knowledge distribution networks in the 80s and 90s.

Scams and low quality content are usually a strong indicator something used to be good, and attracted copy cats.

hggh2• 2 years ago

Yes. He really does say this.

Yes, but keep reading...

hggh2• 2 years ago

This is taken out of context, and the author of the blog post should keep reading:

(taken from the same paragraph about the cat)

"I make this absurd statement to illustrate how absurdly easy and simple the game is. So many people make things too difficult and take them too seriously."

ASalazarMX• 2 years ago

The book had actual garbage advice, live repeatedly suggesting to invest in real state. In contrast to the sensible advice on savings and living below your means, this one was simply "become a real state speculator". When the real state bubble burst, probably a handful of its followers were in a position to make bank from it.

In fact, any author who claims to tell how to become rich, but is still not filthy rich, is a scammer. Most of the content in these kind of books could be resumed in one or two pages, but that wouldn't sell.

AmericanChopper5• 2 years ago

I also haven’t read the book, but I’ve seen some of his speaking. He tends to make a lot of incredibly oversimplified observations about basic debt instruments, and then acts as if they’re utterly profound insights. If an interviewer ever pushes him a little, he seems to just get defensive and kinda looks as though he doesn’t really know what he’s talking about. He’s certainly given me the impression that he’s just a conman that doesn’t have any more than a one-inch-deep understanding of any of the topics he loves to yap about.

But he is right about Dave Ramsey. Ramsey has a completely irrational perspective on debt, and often gives some very stupid advice on topics relating to it.

bombcar15• 2 years ago

The key with Ramsey is if you follow his debt rules, you'll .... be ok? Maybe not mathematically as great as you could be, but ok?

But if you follow Kiyosaki's rules, you could be in prison.

matwood6• 2 years ago

I think Ramsey takes it too far, but then I think about his audience. I can gamble and drink alcohol without getting addicted. But for people who are addicted they usually need to completely stop. I see the same thing with those who are not able to manage their spending or debt. They need shock and extreme measures to get back to a good spot.

jarsin• 2 years ago

IMO contracts are no different than a handshake anymore. They have so much fine print nobody, not even the judges you will spend a fortune arguing in front of, knows what anything means anymore.

kevindamm2• 2 years ago

It's somewhere in between those extremes. It's true that some things that go into a contract aren't actually valid because they infringe on rights or aren't within the authority of its parties. It's also true that some things are only valid if they're mentioned in the contract, because they might not be a typical part of doing business (e.g. things like fees or handling disagreements in arbitration hearings). It's also true that some things are implicitly in the agreement without being mentioned in the contract.

It's worthwhile to be aware of what's called the Reasonable Person standard. If you own a business it is worthwhile to be somewhat familiar with the corporation law in the jurisdiction the company is incorporated in. And it's always useful to have a lawyer you can ask some questions, if for no other reason than to have some chance of avoiding those expensive (in $$ and time) arguments before a judge. But I'm not a lawyer so don't ask me.

jakey_bakey• 2 years ago

Kiyosaki is absolutely a charlatan, I thought we all learned that in 2010?

epolanski2• 2 years ago

While a charlatan, something I agree on, his points are solid.

Don't get in debt, direct your cash flow as soon as possible to things that make you money, rather than buying Teslas and other stuff you don't need.

His whole point is that two people with same incomes and jobs, can be extremely different in wealth after a decade based on their habits and how they spend or invest money and the obvious fact thst it compounds.

llm_trw• 2 years ago

To quote someone actually successful:

Rise early, work hard, strike oil.

mewpmewp211• 2 years ago

Wouldn't interest rate matter for debt?

And for most it would be impossible to afford a home without going to debt.

gizajob2• 2 years ago

Even a quick glance at Kyosaki’s twitter will show you he’s gone full loony nowadays.

agumonkey• 2 years ago

Some shorts report he is broke now.

gsky• 2 years ago

Yes and also 4 hour work week

lawn2• 2 years ago

I found it very amusing that Tim got burnt out because people got into the habit of tricking him into a lunch by claiming that he would be joined by someone important, who of course didn't show up. A tactic that Tim himself popularized.

Not so great when you're the one being taken advantage of now is it?

bananapub2• 2 years ago

the advice is all shit but the meta-game isn’t - writing pop advice books actually is lucrative, especially back then. It’s just that you have to pretend you’re doing something else, which in his case was some nonsense about residential property.

citizen_friend6• 2 years ago

You don’t think he made a lot of money in real estate?

bananapub2• 2 years ago

Dunno. I don’t think his real estate advice in the book was good.

dahart• 2 years ago

That’s what the article suggests: “there’s no evidence that Kiyosaki actually made significant money by real estate dealings, prior to making millions of dollars with his book sales (and presumably putting some of that into real estate.)”

noelwelsh• 2 years ago

The "If Books Could Kill" podcast discusses this book and others in the same genre. The two hosts are reasonably thorough in their research, and quite amusing as well.

wickedsight2• 2 years ago

Thanks for the recommendation. I often get books recommended that I think could've been an article or where I doubt the science behind it. This sounds incredibly interesting!

space_oddity5• 2 years ago

Love the podcast. It’s worth a listen.

janice1999• 2 years ago

Excellent recommendation. I'm always impressed by how thorough and fair the hosts are. In their recent episode on "The Anxious Generation" it honestly feels like they did more research than Jonathan Haidt did when he was writing it.

citizen_friend6• 2 years ago

He already has stated publicly that the “rich dad” is a characterization. And the book is about the 4th product in his attempt to teach finance courses. So I’m already suspect of the article.

Yes it’s a terribly written book, but that’s typically the case from non-professional writers who just have something to say.

My biggest takeaway is that “stay in school so you can get a good job” is not a great wealth creation strategy. You just compete with other highly qualified candidates for jobs that pay 20-30% more (See 20+ years at Boeing). Jobs like this also attract other risk averse people.

Oarch• 2 years ago

"Get Rich" books have frequently worked throughout history.

For the author.

swimorsinka• 2 years ago

+100 to this. There's no better successful enterprise than becoming a guru - assuming you have the personality to pull it off.

lnsru2• 2 years ago

Reading your comment I immediately think about this personality: https://en.m.wikipedia.org/wiki/Bodo_Sch%C3%A4fer

Getting rich by selling books how to get rich.

space_oddity5• 2 years ago

It’s stupid and funny and sad, all at once

spamizbad• 2 years ago

You can distill all the advice this book has to offer into one sentence: Rather than succumb to lifestyle creep, direct your cashflow from your 9-to-5 towards other endeavors that can make you money. That's it. That's the book. There is no step-by-step guide on how to do this, just a narrative, anecdotes and a few examples mostly around real estate.

micromacrofoot4• 2 years ago

Is it even possible to have a step-by-step guide for something like this? outside of "invest in index funds" or other historically secure and boring investments everything else looks like a crap shoot.

toomuchtodo• 2 years ago

https://en.wikipedia.org/wiki/The_Index_Card

https://web.archive.org/web/20231213153144/https://i.imgur.c...

https://www.bogleheads.org/wiki/Three-fund_portfolio

As 01HNNWZ0MV43FF mentions [1], you can just dump everything you can into VTI or VTSAX, and you'll be ahead of most people. If you're looking for something more, that will cost you time and money to research and manage exposure to (real estate, private equity, other asset classes beyond public securities, etc). Make as much as you can, invest as much as you can as efficiently as possible. That is what buys your time back.

(not investing advice, educational purposes only)

[1] https://news.ycombinator.com/item?id=41245973

forgetfreeman10• 2 years ago

Eh. Everyone needs somewhere to live and the one thing in the world nobody's gotten good at making more of is land.

seanthemon• 2 years ago

personally the advice I follow is to buy actual metals like gold and silver (not invest in those, but physical authenticated metals). I can't guarantee it will gain or maintain value in the future, but i'd rather have a constant than an unknown loss. Anything else I put into S&P500 and forget it existed in the first place

01HNNWZ0MV43FF3• 2 years ago

I'll add some unnecessary fluff:

Don't invest in real estate. If it was a free lunch, someone else would eat it first. VTSAX is way less work.

All that matters is the savings ratio. Everything else cancels out. I promise. https://www.mrmoneymustache.com/2012/01/13/the-shockingly-si...

So a penny saved is actually worth more than a penny earned, because it means you need less invested to retire.

monero-xmr3• 2 years ago

Owning rental property is a small business. You can earn far more, reliably, without the whims of a number going up and down, than you can by passively investing it.

In general I have always found the passive investment "standard smart advice" to be wrong, but I'm a contrarian by nature. I actively manage everything because I like to know what's going on.

FredPret2• 2 years ago

If VTSAX was a free lunch, someone would’ve / is currently eating that too

quonn• 2 years ago

This is incorrect, if the real estate is your primary home.

If it is not your primary home, it may be correct, but not necessarily.

And only saving is not enough, because inflation can eat it all.

bequanna• 2 years ago

If you're comparing passively investing in VTSAX vs some REIT, I might agree with you. But generally, the fewer people between you and your capital being deployed, the higher the return.

Real Estate is the one investment that most people can own, manage, improve as individuals without a ton of special skills/knowledge. Additionally, you can choose the amount of leverage you want to apply and there are considerable tax benefits.

If you have the time, a little knowledge, and enter at a decent time in the market with not TOO much leverage, Real Estate is an excellent long term investment.

bombcar15• 2 years ago

That's the real takeaway from everything.

If you live on 100% of your income, you are doomed, you can't save anything.

If you live on 90% of your income (ignoring market returns for simplicity) you "earn" one year every 9 years or so.

If you live on 50% of your income, you earn a year every year.

And if you somehow got down to 10% of your income, each year you worked would be nine years you wouldn't have to.

This math works with 0% return (or a return matching inflation only).

Nemi2• 2 years ago

I agree with much of this, but I do think that there is a flaw in his logic - he operates on the notion that saving more of your income has a two-fold impact on your ability to retire.

First, and most obvious, it increases how much savings you have. But secondly, he states that you permanently decrease your expenses, making that magical 4% withdrawal rate of your savings easier to attain.

And yes, while that is true on the surface, the underlying message is - if you just don’t have cable tv (streaming in today’s world) and other things like cars and basic vacations, then you are almost there! And yes, if you want to live as a monk then this could be considered by some as a noble thing. But some want to live reasonably comfortably (new-ish car, trips to places like disney world with the kids while staying in a nice hotel vs biking and camping).

I only bring this up because even mister money mustache has admitted that he is unusually monk-ish in his lifestyle choices. Don’t get me wrong, I actually retired 7 years ago partly on reading his blog, so I get it. But we have to be realistic on what his message is and what others are liable to achieve.

I guess what I take most umbrage with is, he says that it is easier and more effective to cut expenses than raise earnings. And just like a business, this strategy quickly runs into diminishing returns. Raising the top line while keeping expenses reasonable is always the best strategy to an early retirement (or a successful business).

tim3334• 2 years ago

I'd say in the UK the majority of rich people are so through owning real estate. It's kind of a time honoured thing. Not sure it's a good thing - probably it's one of the reasons for slow economic growth here that people sit on property rather than making stuff.

QuantumGood• 2 years ago

VTSAX: Vanguard Total Stock Market Index Fund Admiral Shares

alecco• 2 years ago

If most people blindly invest in index funds the whole market ends up overvalued. And they kill competition as companies only aim to just stay in the index.

It should be adjusted by current and expected returns. Else, it becomes an asset bubble with insane multipliers of real returns (like today). You are just counting on someone else to buy the stocks when you sell in the future.

thunky2• 2 years ago

All that matters is the savings ratio. Everything else cancels out. I promise

This is an oversimplification.

It reminds me of those retirement calculators that estimate retirement based on a percentage of current salary, without considering that income and expenses change over time.

We don't aim to live on ramen noodles for our whole lives.

jacknews• 2 years ago

If his advice actually for real, it could be distilled further:

own the means of production (or an indirect proxy, eg land).

lenerdenator• 2 years ago

Aye, the real trick there isn't in the book: getting some guy with more means of production than he - or any other human - could possibly exhaust in a lifetime to let you have any means of production of your own.

jocaal2• 2 years ago

in capitalism, the most important factor of production is capital.

Rhapso• 2 years ago

We can go even shorter:

Be mindful that behaviors that once were useful may cease to be so and you should update them.

7thaccount• 2 years ago

Yep. Basically it just points out that rich people have passive income and this is better than just having a single normal job.

For example: Gordon Ramsey has restaurants and TV shows and probably a product line or two. He makes a lot more money from that than just being a chef. This kind of shift requires a comfortability with risk that many don't have coupled with hard work AND luck.

scrapcode2• 2 years ago

They all say the same stuff essentially: avoid fast money hype & invest in slow, steady, low-risk vehicles.

mewpmewp211• 2 years ago

So then you would have been missing out on the tech? And invest in bonds?

hylaride3• 2 years ago

Pretty much this. In Canada, we have a book called the Wealthy Barber ( https://en.wikipedia.org/wiki/The_Wealthy_Barber ) that came out in the late 1980s that was a fictional story of a "rich barber giving financial advice to young people". It essentially lays the groundwork for compound interest working in your favour and gives sensible advice on life insurance, estate planning, etc.

The TL;DR is the "pay yourself first and make it so that 10% of your income goes into a mutual fund before you even see the money"(1) and reasonably stay out of debt and you'll likely be financially successful. The other point is that money is just a tool and tools can be useful (buying food, shelter, pleasure), but can also hurt you (debt, bankruptcy, etc).

In the book he even advises AGAINST real estate because of the PITA (pain in the ass) factor of having to deal with tenants and upkeep.

1. This is the 1980s and index funds weren't yet in the zeitgeist, but subsequent revisions address this.

Xen9• 2 years ago

Yours is ridiculously bad advice, but typical for those who work to say. Even for person with no other sources of income, the optimal path is investing such that you will within reasonable amount of time be able to with "certainty" move "reinvest income from X" instead of slaving. But mathematically speaking, even very high income seems to not to be possible since to invest 10000€ year you'd need to have about 1M€ in dividens.

Time is truly the most valuable resource of one. But you fail to believe this.

N.B: Elon Musk strategy of using pre-existing assets as collateral for loans is a great strategy for millionaire-businessmen.

83457• 2 years ago

What is a good alternative book along the same lines?

lawn2• 2 years ago

Morgan Housel's books are pretty good I'd say.

tim3334• 2 years ago

The "How I Turned $1,000 into Five Million in Real Estate in My Spare Time" by William Nickerson books are good on US real estate.

At least on the principles - they are old now and laws change but the principles remain.

eg https://www.amazon.com/Turned-into-Million-Estate-Spare/dp/0...

Basic idea but tatty discounted rental property, fix it up, borrow against it, buy more.

DataDive• 2 years ago

And for contrast, here is another book from the early 2000s that, seems to have stood the test of time:

The E-Myth Revisited: Why Most Small Businesses Don't Work and What to Do About It

1: the entrepreneurial myth: the myth that most people who start small businesses are entrepreneurs

2: the fatal assumption that an individual who understands the technical work of a business can successfully run a business that does that technical work

Gerber draws the vital, often overlooked distinction between working on your business and working in your business.

https://www.amazon.com/Myth-Revisited-Small-Businesses-About...

iainctduncan2• 2 years ago

Yes, this one is actually good. It definitely helped me learn how to operate better as a self employed person.

On the other hand, I've only ever heard "Rich Dad, Poor Dad" recommended by other people in the selling-dreams game.

bombcar15• 2 years ago

That was the #1 thing that set me off against it decades before I found Reed's evisceration. The only people talking about it and promoting it were multi-level marketing scammers and adherents. Very cult. Much hype. Wow.

edanm• 2 years ago

Very, very good book IMO. One of the few business books I've read that's absolutely worth reading.

velcrovan• 2 years ago

I've done alright for myself investing and owning a small business. I read this book years ago and I found it gimmicky. It's chapters and chapters of clickbait-y cliffhangers and parables that just never pay off with anything concrete. I recognized a lot of the rhetorical maneuvers from MLMs and "filler sermons" I grew up around. And the most financially illiterate people I know swear by it as an infallible text.

bitwize2• 2 years ago

If Kiyosaki's rhetoric sounds MLM-like, it's because he's made fistfuls of cash as a spokesman/motivator for the MLM movement, Amway specifically. The MLMs love these motivational speakers because they help keep people in the program buying product, even when they otherwise would have wised up and left. And it gives the higher-ups plenty of "training materials" (books, tapes, etc.) they can sell to their downline (which is how the real money gets made).

_uhtu• 2 years ago

One thing not mentioned in the article: People may be wondering how this book became so popular, basically it's because it became intimately tied to the MLM movement, Amway specifically but it did spread beyond that. People at the top of the pyramids would buy thousands of copies to send down their "downline" as part of a motivational tool. The primary goal of someone near the top of an MLM is to convince everyone down the line that you are ripping off that it's their fault for not hustling hard enough, and this book was and is one of the popular ways of doing that.

pratio• 2 years ago

I read the book on someone's recommendation, but I won't be doing the same to anyone else. The only person that book helped get rich is the author.

Recently, his videos have been going around where he encourages everyone to get into debt and calls everyday working people suckers. I can only imagine how many more people he's managed to swindle.

space_oddity5• 2 years ago

If you're looking for motivational insights and a change in mindset about money, it can be valuable I think.

intalentive• 2 years ago

I don’t remember any specific advice from the book. My takeaway was that rich and poor have different mindsets and motivations which account for the difference in outcomes.

bitwize2• 2 years ago

Yeah, I call it "Real Dad, Fake Dad". Kiyosaki is also very much a part of the MLM motivational complex. Not to be trusted.

lnsru2• 2 years ago

I got my hands on the translated book and original computer game. As very first book about wealth management for poor people it’s fine. I wouldn’t use it blindly as an investment manual. Obviously I learned that wealth generating assets are better than consumed money. I inherited some money, bought an apartment. Its value skyrocketed and I had a down payment for a house. I didn’t had this option if I consumed the money buying fancy car back then. So yeah, the book and the philosophy helped me a lot. I don’t own endless wealth as a rich dad did though.

Tade0• 2 years ago

My friends in college bought Cashflow: the board game so I had a chance to play it.

The notion that children were a financial burden, while correct, didn't sit well with me.

Anyway, I've always read the title as "Rich Dad Poor Dad but most importantly Rich Robert Kiyosaki" because truly that to me was always the real goal behind writing this book.

I've made the financially sound decision to not buy any of his work and let others read it to me.

pgraf• 2 years ago

On another note the author of the book, Robert Kiyosaki, has also been a rampant promoter of Bitcoin. Just recently he predicted the price of one Bitcoin to be 10 million USD soon: https://www.nasdaq.com/articles/robert-kiyosaki-predicts-10-...

I don't think you should take someone who says that seriously for your financial planning.

iainctduncan2• 2 years ago

If you want a book that will actually change how you think about money and leverage, I recommend Peter Drucker "The Effective Executive". The first chapter alone is gold.

Apparently when Bill Gates was asked what he read, he started with "well of course, Drucker" or something similar. It's harder to read, but the advice is actually useful!

nunodonato• 2 years ago

You can't imagine how frustrated I get when week after week, month after month, I see his book on the "top sellers" of all the major bookstores in my country.

etendo• 2 years ago

Every how to get rich/successful book is a waste of time to read in my opinion. Go read a book that teaches you something valuable (to assist you in making money).

thevillagechief• 2 years ago

This was one of the most frustrating books I ever read when I was young. A bunch of people around me kept talking about how they quit their jobs and found success after reading the book, how it had changed their lives. I'd ready it and come out with nothing. I couldn't figure out what I was missing and just thought I must be dumb. It wasn't until I learnt the trick: becoming successful by selling advice about how to become successful that I stopped worrying about it. This silliness is obvious now, but I was barely 20 back then.

lencastre2• 2 years ago

Yes. Saved you a clock.

lencastre2• 2 years ago

Also,… avoid this like the plague and read “IF YOU CAN” instead by the great Bill Bernstein. Thank me later.

lackoftactics• 2 years ago

Picture this: Teenage me, eyeing a self-help book my old man brought home. I was skeptical, sure, but still green enough to think, "Hey, it's a bestseller. Gotta be some good stuff in there, right?" Fast forward 20 years, and boy, have things changed.

These days, my BS detector goes haywire the second someone starts singing praises of self-help books. Finance gurus, spiritual know-it-alls (I'm looking at you, Eckhart Tolle), you name it. But the crown jewel of nonsense? "The Silva Mind Control Method." I'm still gobsmacked by how many folks bring it up as their life-changing bible, despite it being chock-full of pure insanity.

The good news? It seems like it's getting tougher for these wordsmiths to pull a fast one on people. Gone are the days when you could slap together a bunch of truisms, sprinkle in some tall tales, and watch the cash roll in.

But hey, it's not all doom and gloom. There are some self-help gems out there that actually deliver the goods. "Atomic Habits," "Thinking, Fast and Slow," and Malcolm Gladwell's "Outliers" spring to mind. These bad boys? They're the real deal.

etempleton• 2 years ago

I think it is pretty well known that "Rich Dad Poor Dad" is a self help /motivational speaker type book, that is to say it is mostly drivel. Is it fraud? As much as any of those books, seminars, products are.

ageitgey• 2 years ago

It's a very terrible book BUT it was also super important, influential book at the time it was published. It can be both!

As a child, I read this book in a bookstore. Nothing else like this was available to me in the suburbs with parents who didn't have any business experience. The idea of doing anything other than just "getting a job" was totally foreign. The book opened my mind to the idea that you don't have to work for someone else your whole life and that you want to build appreciating assets.

Literally everything else in the book is fluff or flat out wrong. It's not a good book. But for a lot of people, it was also life changing because it broke through in a place and a time when little else was available.

In 2024, we don't need this book. There is so much content available online that is so much better. Someone would get more out of reading a random page of the bogleheads wiki than this entire book. But I wouldn't call the book a "fraud" and I wouldn't deny the amount of influence it had decades ago when it first came out.

mintfreshcancun• 2 years ago

Most criticism in this thread can be summarized as:

    He is dumb and unsophisticated 

    He doesn’t give technical advice

The assumption is that success comes from being smart or credentialed (or fraudulent). This is a bad bias because it manifests as an inability to learn from sources outside your demographic. Furthermore, you develop a susceptibility towards marketing which presents itself as sophisticated (journalist podcasts, Ted talks, ML white papers, etc).

It didn’t take a genius to make money in real estate in 1980. You probably have dumb relatives who did it too. The character traits that helped most were optimism and tolerance for risk. Is this true today? I don’t know. Thinking about that question is more fruitful than assuming failure and seeking evidence to support that view.

tacon• 2 years ago

John T. Reed, an actual real estate guru, has been targeting Kiyosaki for decades.[0] Reed graduated from West Point and Harvard Business School, and he was so early into the real estate investing wave that he debated Robert G. Allen (No Money Down) on 60 Minutes in the 1970s. No one can ever find any of Kiyosaki's investment properties. And check out his opinions of dozens of other real estate gurus on his web site.[1] He does respect a few, but they are few and far between.

[0] https://johntreed.com/blogs/john-t-reed-s-real-estate-invest...

[1] https://johntreed.com/blogs/john-t-reed-s-real-estate-invest...

2-3-7-43-1807• 2 years ago

never read the book nor am I interested to do so but I have to say this must be one of the most mentioned books ever next to the bible. it's like reality set out to find reasons to confront me with it in random places consistently about once every two months for at least 10 years by now.

and as for it being a fraud or not ... isn't the answer obvious already from its cover?

ath3nd• 2 years ago

Yes.

It's basically a salesperson/charlatan selling you their book in which they tell you some very obvious things potentially their far more expensive entrepreneurship course.

If you want the book summarized, here it is:

- take control of your finances and understand what taxes, stocks, futures, etc mean

tim3334• 2 years ago

As best anybody can tell, there never was this “rich dad” character as described by Kiyosaki.

This is just false. Rich Dad was guy called Richard Wassman Kimi.

There's an interview with his son here https://youtu.be/CRq6sjpo9iU

Is "Rich Dad Poor Dad" a Fraud?

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