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- Review: Rich Dad's Retire Young, Retire Rich: How to Get Rich Quickly and Stay Rich Forever!
Rich Dad's Retire Young, Retire Rich: How to Get Rich Quickly and Stay Rich Forever! by Robert T. Kiyosaki
My rating: 4 of 5 stars
This book is good for changing your mindset, and while I don't really agree with everything the author says, he did drive a few good points in the book.
Things like there are three types of income:
Earned is what you get when you work for your money.This type of income is taxed the most (at 30% and higher, because you also get taxed when you buy groceries, and when you live in a house like property taxes-- at least in the US context)
Passive is the least taxed - this is income that you get when you have real estate investments or other intellectual property income like books, or music, or anything else you may have invented and own the trademark/patent for.
Portfolio is taxed as well, but not as much as earned and not as little as passive. These are your stocks, bonds, and even interest that you get from your bank accounts. You get these by investing, which most people do.
What he wants to drive a point is: you can't get rich nor retire young if you are solely surviving on earned income. Too often people go to work because that's what the norm dictates us to do: go to school, go to college, graduate, find a job, get married, stay at home with the kids and then it repeats itself again. Occasionally, you switch jobs to get a higher salary or even a higher position in the company and vie to get a bit more out of your 'career' in the future.
But the above doesn't really work: instead you're enslaving yourself more and more and becoming more dependent on your employer.
What the book does is it tries to switch off your mindset from the earned income perspective and gradually move to the passive and portfolio income perspective in able to retire young and retire rich.
To be honest, I have no intention to retire rich where I will have a problem on what I'll spend my money on (like the author claimed), but I want to retire early and have enough income generated by my assets enough for me and my husband to live on. It could be less than 2 Million dollars, to be honest.
That part of the book says that is a middle-class mindset. The ultra rich apparently earn at least a million a month in income generating assets, and the middle class earn less than a million a year or something of that sort.
I don't agree with that. Not all people want to become rich, some people, like me, just want enough. Enough to be able to do what we want - to be free from the cubicle dwelling life and to pursue other pursuits and passions: be it staying at home with the family, or traveling the world, with just enough extra coming in that you can afford to shop or spend on your guilty pleasures.
That's the main reason why I gave the book 4/5 stars. Too much money can lead to greed, and for some people, enough is well, enough. While I do like some of the tips that he presented in the book, I'm not sure that some of them are still available or are still useful in this current year (2016/2017), as the book was initially published in the early 2000s, I think before the real estate market crashed.
Overall, I would say the subject of the book is to move your mindset from an earned income one to a passive/portfolio income one. This means you should invest in stocks/bonds, and other paper assets, as well as maybe real estate or create something that other people may buy from you.
Solve a person's problem for life and maybe you will get money for life. Not sure what it is exactly in our context right now but maybe we'll get there.
Good book to change your mindset and your context/content. It is also great reading for those who want to retire early
It's the last day of the year 2016 as I type this so hopefully everybody had a great 2016 and here's to 2017 and the other years ahead of us. May it be as prosperous for everyone.
Oh, and now is a great time to actually think about what you do want in life, and focus on achieving it in the years to come.
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