Rich Dad, Poor Dad Critique - Essay Example

While highlighting the importance of financial literacy, Robert argues that the education system is flawed. It focuses more on creating job seekers rather than job creators. The author suggests that students should not go to high school. He claims that higher education does not prepare one for life on the streets. A huge part of the problem is that financial literacy is not discussed in schools. Years are spent preparing students for work. However, educators do not put effort into preparing students to manage their finances. This is one of the greatest lessons learned. Several students become jobless and have to repay expensive student loans due to high tuition fees. It is a common assumption that being a business owner is riskier than working for someone else. Kiyosaki mentions that being an entrepreneur is not as risky. The current generation grew up thinking that owning a home is an asset. Robert refutes this common assumption explaining that owning a house does not generate cash flow. The housing bubble and subprime mortgage crisis proved this assertion. In the book, Robert defines an asset as something that puts money in your pocket. A liability usually takes money out of pocket. Many people correctly point out that this does not follow general accounting standards. Robert acknowledges this claim, reminding readers that focusing on cash flow gets one wealthy. His definition of wealth is best summed with a supposition. How long can one survive without working for an income?

Another key element is minding your own business. Financially healthy individuals should spend most of their time investing in assets as opposed to spending their paychecks. Under taxes and corporations, he gives advice some would find morally unacceptable. His tax dodges can be accurately described as tax delays. However, there are benefits to minimizing taxation on expenses related to money earned by moonlighting. In the fourth element, he says that the rich invent money. His examples may not be so convincing but he does have a point. During the internet age, one can make own money by creating intellectual property. The author also addresses the need to learn and not to work for money. Robert downplays the role of risk when making investment decisions though he counters this idea. He advises a reader to fully understand investments before investing money.

While I may have reservations with some of Robert’sadvice, such as finding and exploiting tax loopholes, I agree with the philosophy of accumulating wealth. I agree with his argument that the first step to wealth is watching cash flow. This is because to grow financially you need to be bringing in more than the expenses. Wealth is a good thing because it frees one from worrying about paying bills to discover purpose and the things one enjoys. It is crucial to note that creating wealth is the greatest aspect of wealth in my book. It also enables one to help other less fortunate people in society and empowers one to fight for causes he or she believes in. Sir Richard Branson can inspire entrepreneurs worldwide and mobilize business and political forces to fight the world’s challenges. Bill Gates and Warren Buffet fund development and antipoverty eradication projects in the developing world because they have the resources and the networks to marshal financial resources for such noble causes. Another reason indicating that the accumulation of wealth is right and desirable is striving to better ourselves. This means being able to give your children a better start in life than your parents gave you.

My Path to Financial Freedom:
1. Start generating extra income by doing freelance work designing websites, flipping goods on eBay, and working on weekends running errands.
2. Save half of all the money I make, channeling it into the stock of undervalued companies.
3. Find a business opportunity and start a small business while in school.
4. After school, it is important to scale the business while also doing side jobs during the weekend and free time.
5. Try finding a big idea, one that can change the world, and patent it. In addition, it is important to write books and acquire rental properties for residual income.