Teach to be Rich
Teach to be rich is a book written by Robert Kiyosaki, often mixed with Rami Sethi’s book “I will teach you to be rich“. Teaching what you want to learn is the best way to learn, and helping others become rich is how you can become rich yourself
By Robert Kiyosaki and Sharon Lechter, 317 pages
Teach to be Rich summary:
Introduction
We’re in a new era now, not the industrial age. The old path of going to school, getting good grades, finding a secure job, and retiring with a government pension is no longer guaranteed. We’re in the information age, where things are changing fast. You might switch jobs multiple times in the future.
Teaching is more important than ever, and that’s where Robert Kiyosaki’s book comes in. It’s for parents who want to take control of their children’s education. To give them the best chance, parents need to teach their kids what the school system doesn’t cover. ‘Teach to be Rich’ helps parents educate their children about essential money concepts. It’s all about finding out what you should teach your kids about money.
Chapter 1: All children are born rich and smart
In every chapter, the author uses examples from his previous book, “Rich Dad, Poor Dad,” featuring two fathers. These two dads believe that all children are born both rich and intelligent. Each dad teaches this idea in their own unique way. “Poor Dad” excelled in education, while “Rich Dad” excelled in financial independence and entrepreneurship. The interaction between these two fathers helps the child understand through a teaching approach, and it also serves to convey information to the readers.
When faced with a problem, there’s no one-size-fits-all solution. There’s neither a right nor a wrong way. We need to be clever enough to recognize the strengths and weaknesses of each situation. In the information age, we should learn from our elders but also be capable of learning in a smarter way.
“Teach to be Rich” is a book for parents who want to educate their children more intelligently. It’s for YOU.
Chapter 2: Is your child a genius?
As we see our children grow, we often have big dreams for them. We imagine them becoming champions, achievers, and shining stars. Maybe we hope they’ll succeed in ways we didn’t.
What is your financial IQ?
Your financial intelligence isn’t determined by how much you earn or the value of your possessions, like your car or your house. Surprisingly, the author links this financial understanding to the idea of “freedom.” I really like this sentence from Robert Kiyosaki: “If you aren’t happy while striving to become rich, it’s likely that you won’t be happy when you become rich. So, whether you’re rich or not, make sure to be happy.”
In the end, measuring your financial intelligence isn’t about traditional things, but about your capacity to grow your knowledge about money to gain something even more valuable – time and the ability to use it as you wish.
What is intelligence?
In a common example, the author compares a child who does well in school to a child who excels in sports. Does this mean one is smarter than the other? No, it means they’re each nurturing their unique types of intelligence. Every parent who wants to learn how to teach should understand this essential concept.
How many different kinds of intelligence are there?
There are various types of intelligence, not just the one focused on in the school system. Let’s break it down:
- Verbal and Linguistic: This is the intelligence related to language. People like journalists, lawyers, teachers, and writers often excel in this area.
- Numerical: It involves working with numbers and data. Mathematicians and engineers are examples.
- Spatial: This is about creativity and understanding visual information. Artists and designers typically have this type of intelligence.
- Physical: This relates to hands-on skills and physical abilities. Athletes, dancers, and skilled builders fall into this category.
- Intrapersonal: It’s about emotional intelligence, that inner voice guiding you. It’s vital but can be hard to define.
- Interpersonal: This relates to communication and relationships. Famous singers, actors, politicians, salespeople, and speakers often excel here.
- Environmental: This intelligence is about a connection with nature and working with natural elements. Think of animal trainers and oceanographers.
In essence, everyone has a mix of these intelligences. This chapter helps parents understand their child’s natural strengths. Making your children both successful and intelligent means letting them develop their unique talents, not holding them back.
Chapter 3. Give your children power before giving them money.
People often ask Robert Kiyosaki two questions: “How can I invest when I don’t have any money?” and “Does it take money to make money?” His answer is no. He believes that the power lies in ideas, and that means anyone can have as much money as they want.
In “Rich Dad, Poor Dad,” the first lesson from the rich dad is that “The rich don’t work for money.” Instead, you should learn how to make money work for you, not the other way around.
Education is crucial. Rich Dad emphasizes that many people learn about money and life from their parents, and schools don’t teach these things. The book aims to help us understand this and pass on this knowledge to our children, no matter our social status.
For instance, when it comes to giving your child pocket money, the author advises not teaching them to work for money but to work hard and learn not to depend on money. The author says, “When you give a child pocket money, you teach him to work for money instead of learning how to create money.” This doesn’t mean you shouldn’t give your child money. It means you should also give them a good financial education and share ideas about money to set them up for success in life.
At what age should you teach what your child needs to know about money?
The answer to when to start teaching your child about money is simple: “When your child starts showing an interest in money.” It depends on your child’s curiosity and age.
For instance, my child is 6 years old, and she’s starting to ask questions about money. So, I’m introducing some basic concepts while we play with her piggy bank or when she receives money from the tooth fairy.
According to an unnamed expert mentioned by the author, children typically develop their “winning formula” between the ages of 9 and 15. This means they start forming ideas about their best chances for success and how to handle money in life. It’s not just about money itself but about finding a way to lead a successful and happy life. People tend to be content when they’re satisfied with their own strategies for success.
Winning formulas
Each of us needs to discover our own path to success, and fortunately, there are many paths to choose from.
The most well-known path is to work hard in school, get a good education, and secure a well-paying job. This is the most common because it’s what our education system emphasizes. But there are countless other paths to success. For example, some become superstar footballers or successful entrepreneurs who didn’t rely on traditional education. Think of people like Steve Jobs, Jack Ma, or Olivier Roland.
One of the most important things parents can do is help their children explore and find the paths that work best for them. Encouraging them to build a strong self-image and self-confidence will help them become both financially successful and intelligent. According to R. Kiyosaki, this is a fundamental aspect of your child’s education.
Chapter 4. If you want to be rich, you have to do your homework
In teach to be rich, the author uses the idea of homework to explain how to become rich, and it applies to both kids and adults.
When you have a job, you earn money, but it’s what you do with that money at home that matters. “The biggest difference between the rich, the poor, and the middle class is how they spend their free time.” It’s about what you do with the money you earn that determines if you’ll be “rich or poor.”
So, the author suggests doing your “homework” to gain financial freedom and not rely on money alone.
Chapter 5: How many winning formulas will your child need?
Your child should have three key strategies for success:
- Learning
- Professional
- Financial
Finding your learning formula
We all have different ways of learning in school. Some kids learn best by listening to their teachers, some by writing down their lessons, and others by practicing. This means there are countless ways to learn, and each child has their own special way.
It’s the parents’ job to figure out what works best for their child. Parents should watch their kids and help them discover how they learn best. If a child doesn’t enjoy school, the author suggests encouraging them to find their own unique way of learning.
Finding this special way of learning is just as important as the grades your child gets in school. As the author says, “Your real education starts when you finish school and step into the real world.”
Chapter 6: Will your child be left behind by the age of thirty?
In today’s world, it’s unrealistic to expect a job for life. That idea comes from the past, the industrial age, and it’s an old-fashioned way of thinking about careers.
The author believes and highlights in “teach to be rich” that by the time your child reaches around 30, their current skills may become outdated. So, it’s crucial for them to develop a strong professional strategy to adapt and find new opportunities when that happens.
Learning should be a lifelong journey, even in the adult and professional world.
A powerful example the author gives is about a worker who doesn’t acquire new skills in the information field. How long before they fall behind?
The author mentions an article from Australia that talked about when people are considered “too old” for certain professions, like graphic design, gymnastics, law, or modeling. The article and the author’s message highlight the importance of finding new professional strategies.
“It’s important to let your children know that the ability to change and learn is even more critical than what they’re learning in school today.”
Parents should help their children envision their future, but it doesn’t mean letting them do whatever they want without guidance. It’s about understanding your child’s perspective and guiding them toward a successful path that suits them.
Chapter 7: Could your child retire before the age of 30?
School is important, and the author doesn’t say you shouldn’t go. In fact, a good education is vital because it teaches professional skills and helps you become a better learner.
However, school often doesn’t teach you how to find your financial success strategy. It doesn’t cover even the basics of managing money. As a result, many students end up well-educated but unprepared for the modern world of spending, credit cards, and loans.
In today’s fast-changing information age, the author suggests that your children might struggle with technology by around age 30 if they don’t adapt and acquire new financial skills. While retiring before 30 may sound extreme, the key is to start searching for a new financial path.
Discovering your financial success formula usually requires self-reflection and changes in your thinking, emotions, actions, and values. Only then can you begin your financial education.
Ultimately, the goal isn’t to push your child to retire at 30 but to empower them to explore their own financial path. Parents should teach their children how to thrive financially.
Chapter 8: My banker never asked for my school grades
Grades matter a lot in school, but when you deal with your banker, they won’t ask about your grades or your university degrees, whether you spent years in higher education or left school without a diploma.
What your banker does want is a financial report card. This report card reflects your real-life financial situation.
It’s essential to grasp and help your children understand the difference between assets and liabilities. The author uses simple diagrams to show that cash-flow reveals what’s an asset and what’s a liability.
Think about it this way: If you were to stop earning a salary tomorrow, your assets would be on the positive side of your financial statement, and your liabilities on the negative side.
Contrary to common belief, a house or a car are not assets. They represent ongoing expenses.
In the end, Robert Kiyosaki emphasizes that your banker doesn’t care if you were the smartest student in your class at school. What your banker cares about is how financially savvy you are.
Chapter 9: Children learn through play
Teaching your children should be enjoyable, and you can find ways to make learning fun for them.
The school system often doesn’t allow teachers to use these creative teaching methods. Children are typically taught in a traditional way, and those who excel are usually good at traditional subjects like language and words. But if your child doesn’t thrive in this system, it’s up to you as parents to find an alternative approach.
When it comes to financial education, the author suggests three stages of learning:
- Understanding through simple diagrams.
- Learning through play.
- Real-life application.
Robert Kiyosaki recommends starting with play, as it’s the most effective way to teach kids about money concepts. You can begin by playing games like Monopoly, which can make learning about money management enjoyable for children. The key is to make learning enjoyable so that children stay interested in it.
Chapter 10: Why people with savings are losing out
In this chapter, the author explains that the old method of saving money is no longer a winning strategy. This old approach involved doing well in school, getting a job, earning money, buying a house, and then saving. It made sense in the past but not in today’s information age. You should introduce your children to more modern financial concepts.
For instance, putting €10,000 in a bank account and waiting for the interest (let’s say €200 at a generous 2%) won’t make you rich. It takes a long time for that money to grow significantly.
The author uses an example to show how money can circulate more effectively. He suggests investing that same €10,000 as a down payment on a €100,000 rental property. After a year, the income from the property, minus expenses and taxes, generates a net profit of €10,000. You can use this profit to buy another property, which becomes an asset for you.
As parents, it’s crucial to teach your children that their money should work for them, not the other way around. The art of parenting is about teaching these concepts to your children in a fun and engaging way.
Chapter 11: The difference between good and bad debts
In this chapter, the author explains how to nurture your child’s financial intelligence. One essential lesson is helping them distinguish between good and bad debts.
For example, the same bank loan, like a mortgage, can either be a debt that costs you money (buying a house for yourself) or an asset that saves you money (buying a house to rent out).
Parents should teach their children that not all debts are bad. If children grasp how money functions, they can step into the working world with confidence, knowing they won’t easily fall into debt in today’s modern consumer society.
Chapter 12: Learn by using real money
Imagine a 14-year-old boy who wants to buy golf clubs. The author explains how this young boy can transform into a young entrepreneur capable of financing his desired purchase.
Parents should encourage their children to take some real-life financial risks using actual money. This helps kids develop their natural creativity and learn the basics of financial education.
While these are just the fundamentals and don’t provide all the answers to life’s challenges, they set the foundation. As your children grow up, they’ll have the freedom to shape their lives as they see fit.
Robert Kiyosaki puts it this way: “The biggest risk of all is not taking a risk, and you should learn from your mistakes when you’re young.”
Chapter 13: Other ways to increase your child’s financial IQ
Nothing is complicated when you use simple words
Using straightforward language can make anything easier to understand.
To improve your children’s financial education, teach them simple words and how to use the right words for the right situations.
Having a high salary, by itself, won’t make you rich. You need to turn that salary into income that doesn’t require active work. That’s what wealthy people teach their kids to do.
The power of communication
Effective communication is key. If your children can blend financial words with strong numerical skills, they’ll have a great financial foundation for life.
Chapter 14: What is the point of pocket money?
Money is a teaching tool.
Some children may mistakenly believe they’re entitled to money, but this is not a healthy perspective. It’s also not advisable for children to think of work solely as a way to earn money, as it means they’re trading their time for cash.
Instead, children should learn the concept of giving and receiving. The idea is that the more you help others, the more you can gain, as the author says: “The more you serve people, the richer you become.”
This is vital because if your income depends solely on a salary, you’re limited to the hours you work each day. However, if you adopt a system not tied to time, you can potentially assist countless people and have an unlimited income. Robert Kiyosaki, for instance, transitioned from teaching a few people in person to writing a book that conveyed the same lessons to many more.
“The more you serve people, the richer you become.”
Many readers ask the author questions like how much pocket money to give their child, whether to pay them for chores, or whether to encourage them to get a job. There’s no one-size-fits-all answer because every child and family is unique. Parents need to adapt to their specific circumstances.
Money is a valuable teaching tool, but children shouldn’t study or do chores just for money, as this approach might not prepare them for the future when they have to manage their finances independently.
Chapter 15: How to discover your child’s natural abilities.
The final section of the book guides parents in uncovering their child’s innate talents.
To begin, you need to identify the learning method your children prefer and what inspires them. Afterward, you can determine the type of intelligence and natural abilities they possess.
This discovery is crucial for setting them on the path to a successful life. Some individuals never uncover their own talents, and when they complete their education, they lack the tools for ongoing personal growth.
Parents should encourage their children to explore their unique learning styles and nurture the genius within them.
Chapter 16: Success is the freedom to be who you are
In today’s information age, we have numerous options, sometimes even too many, with plenty of distractions.
So, parents should provide their children with sufficient opportunities to help them eventually discover their own path to success.
A strong financial education equips children with the understanding of the choices they make and their impact on their financial well-being and life. With this knowledge, they gain the ability to shape their own future and steer their careers in any direction they desire.
“Money does not necessarily make you rich”
Conclusion
Parenting involves many important aspects, and one of the most crucial is your child’s education. Every parent desires a good education for their child, but what exactly does that entail? “Teach to be Rich” provides insights to help answer this question.
I believe that “Teach to be Rich” is essential reading for parents who aim to provide their children with a solid financial foundation in life. Beyond offering the fundamentals of financial education to your kids, Robert Kiyosaki also conveys a message to parents. In today’s information age, professions and society are evolving, and understanding these concepts is essential for achieving financial independence.
In my own life, I’ve focused on the Stock Market as my financial pursuit, engaging in a daily swing trading routine that has become a cornerstone of my future financial independence.
In terms of educating my daughters, “Teach to be Rich” has been immensely helpful. I’ve come to realize that nurturing my children’s unique talents and aligning them with their natural abilities is a long-term endeavor. As a parent, you play a vital role as your child’s first and most important teacher. Don’t miss the opportunity to read “Teach to be Rich” and provide your children with the best possible chance for success.
“Teach to be Rich” is an educational guide that empowers parents to impart a strong foundation in financial independence to their children.
The book is also valuable for adults seeking to enhance their own skills and achieve financial independence.
Provides keys and insights for parents who may be uncertain about how to teach their children effectively.
Some readers may however find it challenging to connect the examples from “Rich Dad, Poor Dad” with a broader educational context, potentially affecting the clarity of certain chapters.
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