Sunday, February 26, 2006

A Review of Rich Dad, Poor Dad by Robert Kiyosaki

Financial freedom is something that most people dream about at least once in a while. We would all love to make sound investments in our spare time that will continue to generate a significant stream of passive income for us for years and years to come. That way, we can quit our day jobs and spend our lives doing things that bring us the greatest joy. This is the new version of the American Dream, and judging by the number of books in the financial advice section of my local bookstore, it seems that millions of people want to chase this dream.

Whenever I buy nonfiction how-to books, I try to stick with authors that are well-known in their field. Rich Dad, Poor Dad by Robert Kiyosaki was the very first financial advice book that I ever purchased, and I did so only because the book has been a best-seller for such a long time. I figured that since so many people are still buying it, it must be filled with some pretty valuable advice.

The book starts off interestingly enough. Kiyosaki begins by describing the characteristics of the two dads he mentions in the title. His rich dad was actually his best friend's father. This man didn't even attend high school, yet he was able to work hard, open and operate several different businesses, and ended up being one of the wealthiest men in Hawaii. Kiyosaki's poor dad was his biological father. This man possessed advanced degrees from such prestigious institutions as Stanford University, the University of Chicago, and Northwestern University. Yet because he lacked what Kiyosaki calls "financial literacy," he had money problems throughout his life and died in debt.

Kiyosaki then goes on to talk about the way that he and his friend Mike decided from a very early age that they wanted to be rich. So they gave up their Little League baseball games and instead spent weekends with Mike's dad, learning lessons about such things as accounting and management. By the way, these boys were nine at the time.

After about an hour of reading Rich Dad, Poor Dad I started to get a bit impatient. The book is not very thick, and I was at least one-third of the way through it already and I hadn't learned anything that would help me make my financial future any more secure. I wished the childhood anecdotes would stop so the real advice could start.

Unfortunately, that never really happened. Instead, Kiyosaki seems content to give the reader very vague and ultimately useless statements. For example, he says that in order to gain financial independence, you shouldn't work for money but rather make your money work for you. He also says you should have more assets than liabilities and that you should "pay yourself" before you pay your creditors. While I admit that I am no financial guru, do generalizations such as these actually qualify as advice?

As I said before, I had never purchased a financial advice book before, so I didn't know what to expect. While I know that no book would be able to talk about the subject in-depth or present a step-by-step guide to getting rich. However, I would expect to find something more specific to take away from the book than the statements that Kiyosaki makes.

I also have to say that I was fairly unimpressed with the overall writing style. I know that how-to books are supposed to be pretty straightforward, so I wasn't expecting the author to use fancy words or clever transitions between each paragraph. Even so, Kiyosaki's work failed to meet my basic expectations. For one thing, he repeats himself so many times that I have to believe he and his writing partner, Sharon Lechter, didn't hire an editor to go over the finished product. I know that many self-help or motivational books repeat key ideas in a mantra-like fashion in order to drill the ideas into readers' heads, but Kiyosaki's repetitions weren't like that at all. His seemed to be born out of carelessness and didn't appear to serve a particular purpose.

Since reading Rich Dad, Poor Dad, I have read a number of different reports that dispute several claims that Kiyosaki makes. First of all, it appears that the "rich dad" of the title wasn't actually a real person, but rather an amalgam of different people that Kiyosaki has met in his lifetime. Ordinarily, I wouldn't have any problem with that. However, since this book is marketed as nonfiction and since the role of the rich dad is such a critical one, I felt rather disappointed to learn that he didn't even exist.

Second, it seems that a few of the real estate deals Kiyosaki writes about didn't exactly play out the way he said. Other people have reviewed the public real estate transaction records in the states where Kiyosaki purportedly closed these deals, but the numbers in the reports are significantly lower than the numbers Kiyosaki writes about in his book. If this is true, then it will serve as another reason for me to be disappointed in the book.

Third, there seem to be a couple of discrepancies in the timeline of events that Kiyosaki chronicles in the books when compared to things he has said during television, radio, and magazine interviews. Again, I haven't gone back to verify these things myself; I'm just point out that these kinds of allegations have been made.

Another reason I was disappointed with Kiyosaki's book is that it didn't even motivate me to change my financial habits. If a nonfiction book such as Rich Dad, Poor Dad doesn't deliver the goods as far as giving readers investment advice or anything like that, then the least it could do is motivate me to learn more about these kinds of things on my own. Unfortunately, the book left me feeling even more discouraged about my finances than before since I had spent all that time reading and wasn't any wiser for it.

Since Rich Dad, Poor Dad has been a best-seller for years, I'm assuming that other people have enjoyed it and have learned something from it. So if I were you, I wouldn't totally discount the book based solely on someone else's experience with it. What works for one person may not work for another. I would advise you to skim through it before purchasing it to see if it addresses points that you would like to see covered.

Overall, I find that I simply can't recommend this book because it is so lacking in substance. Then again, I have a feeling that I might be missing something with this one. After all, millions of people can't be wrong, can they?

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