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Early in the book Kiyosaki starts by pinpointing the central problem of retirement income--that ERISA, the so-called Employees' Retirement Income and Security Act, had actually undermined the security of workers' retirement incomes by replacing so-called defined benefit plans, underwritten at fixed levels by companies, with defined contribution plans, under which workers were individually responsible for investing their own contributions. Baby Boomers bought this snake oil because of their desire for individual, rather than collective, security. The results, and wreckage, can be seen at places like Enron. But the marketers of the new plans certainly knew what they were doing.
The underlying problem is that the Baby Boomers were the last American generation to be more numerous than their parents. Every succeeding generation has been of comparable, or even smaller, size because the Baby Boomers' fertility only approximated replacement rates. Thus, there is a flat, rather than broadening, pyramid as age groups get younger. This historic demographic shift called for far-sighted savings and investment plans designed years ahead of Baby Boomers' retirements. (Japan has a much higher savings rate than the US and is now staring this issue in the face.) Because Baby Boomers have put off retirement planning too long (as they have earlier in life with other issues), they are facing a massive financial crunch. The result, as Kiyosaki points out, will be a stock market crash that's almost a foregone conclusion: It's more a question of when rather than whether. The fact that this prophecy originated with "Rich Dad" doesn't make Kiyosaki less of a prophet. After all, God gave Moses the ten commandments.
My main quibble, and it's really a difference of opinion, is with the 2016 target date. In my new book, "A Modern Approach to Graham and Dodd Investing," I outline a target date closer to 2006 (along with some proposed solutions). That's when early Baby Boomers turn 60,and can start tapping their IRAs without penalty. (And they've never been ones to postpone gratification.) It's possible that my target date is too early, and that Kiyosaki's is too late, with the truth somewhere in between. But he and I agree on major concepts, while differing in detail.
This means that RK is predicting not only stock market performance over a decade in the future, he's also predicting tax law over a decade in the future.
The chances that the tax code governing 401k's will weather the years unscathed are miniscule. And it's a good thing too. RK's "ark" of choice - real estate - would also plummet in value during a massive depression where paying tenents would be scarce.
Going into a depression saddled with large real estate debt is a surefire way to be living under an overpass in a cardboard box for your retirment.
RK's got a point -- the market will be hurt when Baby Boomers liquidate their assets to live off of in retirement. But its doubtful that the government will force this selloff when the boomers get here. This shouldn't stop a wise investor from making long-term stock purchases or using more creative vehicles to make money.
I like that RK is so enthusiastic and assertive about getting your financial life in order and making a change in the way that you make money. Investments are great and people should build up some investments for their futures. But this book is founded on such shakey soil that it's difficult to stomach. Pick up some of his others (Rich Dad/Poor Dad or the Cashflow Quadrant) if you need a pick-me-up.
The author presumes that when retiring baby boomers begin to withdraw their 401(k) and mutual fund assets there will be more "sellers" of shares than "buyers" - thus the market will fall. This is a two-dimensional vision of the marketplace, yet plausible.
Regarding investment ideas for the reader: other than recommending the purchase of "income producing" real estate the second half of this book is hollow, and used by the author as little more than a platform for promoting his cash-flow board game and additional books he has written.
I don't feel that the day I spent reading this book was wasted, however, I'm not going to recommend it to any of my "thoughtful" friends.
What is really scary is that Rich Dad predicted this years ago!
I highly recommend this book along with Rich Dad's Guide to Investing for anyone who wants to become a successful investor.
If you want to continue to loose money and get broker, then listen to your broker. That is why they are called "brokers" Listen to them and you'll become "broker."
A forecaster who does not want to ever be proven wrong may give you an exact number or an exact date but never both. Robert gives us neither. He says there will be a major or massive stock market crash. He does not say what massive or major means, down by 20%, 50%, or 90%? (as occurred at the time of the Great Depression).
On page 43 he writes "And millions will be out of money and off support after the year 2020, after this massive stock market crash occurs." So the crash will occur anytime after 2020, could be 2030, 2050, 2080? You get the picture. We could try to pin him down and say that he is predicting that there won't be a massive stock market crash before 2020, but we really can't because if the stock market did actually crash before 2020 it will be up to Mr. K. to tell us whether it was massive and if his prediction was right or wrong. Many professional financial advisors will tell you to run like crazy away from anyone who claims to know the future. Mr. K. writes as if he has a special insight into what the future holds in store for us but is clever enough to avoid actually sticking his neck out. Perhaps he remembers the economist who actually did predict a big crash in the 1990s. Being dead wrong like that won't help book sales.
I don't recommend this book because I think it is an attempt to sell his Rich Dad Poor Dad book again using fear and uncertainty as selling tools this time.
The book warns of many financial obstacles, but has little in the way of strategies to avoid them.
Here. . . I'll save you some time:
The stock market is going to crash around 2016 because of a law called ERISA, so prepare yourself accordingly.
You can make money in up and down markets if you know what to do.
Don't trust your money to mutual fund managers.
Buy, hold, and diversify is not the great strategy you think it is.
Educate yourself financially, but if you don't, stick with buy, hold, and diversify.
Real estate is a better investment for many because you can control it more readily.
There. . . now you don't have to read the book. That'll be twelve dollars.
You need control over yourself, control over your emotions, control over your excuses, control over your vision, control over the rules, control over your advisors, control over your time, and control over your destiny. I like his message of hope after his prediction of gloom. It does not take much to change your financial future. And now I am going to quote a saying I heard once, that Robert hasn't used yet (Not in the books I've read). When it comes time to make a decision there are three choices. To decide yes, to decide no, or to decide not to decide. I believe many people have unconsciously decided not to decide, but by reading these books, and following the advice he gives, you are deciding to take responsibility for your financial future.
I like this book, and I like his writing style. I recommend this book, especially if you have read and liked his previous books.
Others on the web, (John T Reed especially) have gone to great lengths to demonstrate that this man is not who he represents himself to be. The case they make is persuasive. A lot of his "advice" is foolish, ambiguous or both.
However, I have to give the man credit. He tells a good story And there are parts to this book that the so-called "investors" need to know: 1) Markets go down as well as up 2) Investment and savings are totally different things. 3) Those who do not understand the risks the stock market entails should not invest in the market--period.
I put "investors" in quotes because the ones who are most dependent on an ever rising market to bail them out are the ones who stubbornly refuse to acknowledge that the "buy and hope" method of "investing" is much more risky than the academics, brokers, or money managers make it out to be. They have no knowledge or plan for buying or selling investments. They have no understanding of the real purpose of financial markets. And, most unfortunate, they don't understand that neither the "pros" nor the government have any incentive in educating them about how to use the market most effectively.
The author's thesis isn't original, but it is clearly one scenario that could throw out all of the calculations based on the buy and hope strategy out the window. He speculates that ERISA--which mandates withdrawls from retirement plans at 70 1/2, could induce massive selling, causing a catastrophic decline in the market.
Anyone who invests in the stock market should have a plan for if and when a severe decline occurs. Saying you are a "buy and hold" investor is tantamount to saying "I have no strategy at all."
This is true even if you are diversified. At the point of a financial crisis, all the markets are positively correlated--meaning diversification benefits disappear just when you need them the most.
Having said that, the author's advice to "invest" in real estate is poorly thought out. He correctly points out the potential problems when boomers massively sell paper investments (stocks, mostly). Yet, why won't these same boomers also sell their real estate investments? Considering the economic scenario he is portraying, boomers will need all the help they can get.
If you haven't read any of his books, this is probably the best one to get. Then again, while he says you need to have a "financial education", the money you spend on this book could be better spent elsewhere.
In Rich Dad's Prophecy we learn why we shouldn't trust mutual fund managers (although this book was written over a year ago, look at what is happening right now with mutual funds), why "buy and hold" and "diversificiation" are not the best strategies to use and also why passively listening to your brokers (really jokers) can cause you to lose masses of money.
More importantly to the subject of this book is what is going to happen in 2016 when baby boomers liquidate their equity holdings.
Oh, and by the way, this is not a "doom and gloom" book as one individual wrote (probably a broker)this is just good, solid advice for anyone who is investing now and plans on having money invested over the next 13 years.
Some people warned about the "internet and tech bubble" a few years ago. Detractors called that "doom and gloom" thinking too but what happened?
I highly recommend Rich Dad's Prophecy. I also recommend Retire Young Retire Rich and Rich Dad's Guide to Investing.
Likewise, 401 (k)s are just glorified saving plans. Most employers offer investments that are either too boring like poor performing mutual funds to too risky like putting too much in your companies stock.
Think about it. You work a lifetime and hope to retire but find that mutual fund managers have been using illegal trading practices or your funds have underperformed the broad market.
Or your company stock goes south right before you are ready to retire or even worse, your company goes south and youh ave no job and no retirement!
When 2016 comes, even if you have made good choices, babyboomers take their mandatory withdrawals and suddenly it looks like March 2000 to October 2002 only in days, not years!
Robert Kiyosaki is sending out the right message. You must take control of your investments and you must think for yourself. Far too many people are playing the "what should I invest in" game with their broker, financial planners and advisors and ending up broke and confused.
I highly recommend Rich Dad's Prophecy for anyone who has money or plans on putting money in the markets from now to 2016.
Good book - great advice.
While some of the information in RDP is similiar to Kiyosaki's earlier books, the pension, retirement and 401 (k) is fresh, startling and hopefully alarming to anyone who plans on investing their money between now and 2016.
2016 is the year when the bulk of the baby boomers will be forced to liquidate their retirement funds. When this happens, a major stock market crash is expected (no kidding!) that surpass the bear market from 2000 to 2002.
Another problem is what kind of money will current savers have in their 401 (k)s? For example, before going into self employment, I worked in a local office for one of the top 6 banks in the USA and had been putting all I could into my 401 (k) savings plan. Despite this being one of the "Big 6" Banks, matching by the bank was about average (and any matching reflected in reduced wages), options to invest in were patheticly weak and the bank would match us only with shares of Bank One stock.
After reading RDP and going into self employment, I rolled my 401 (k) into a self directed IRA with a brokerage firm. I now choose my investments between stocks, mutual funds and bonds or even Tax Liens, Discounted Mortgages and Real Estate. I'm in control, not my employer.
The only real benefit of a 401 (k) is the borrowing provision which unfortunately too many so called fiancial experts discourage.
And after the Enron issue, who wants to have that much money in company stock?
Kiyosaki is alerting people and none too soon. I am certain that all of the one star reviews are from brokers, financial planners and benefits directors from companies that hope that you blindly follow their advice even it means not having anything for retirement.
I cannot emphasize the importance of reading RDP and more importantly, following the advice.
To repeat, Rich Dad's Prophecy is definitely A MUST READ!
Scandals on Wall Street. Enron, Worldcom, Adelphia. As I am writing this many mutual fund companies are being investigated for securities fraud. How save is your money and will you ever really be able to retire?
In "Rich Dad's Prophecy" you will learn how retirement financing will affect all of us, regardless of our age or where we live. And after it exposes the reasons behind the coming crash, it reveals not only the best ways to safeguard wealth but how to actually prosper from the events to come.
In "Rich Dad's Prophecy" you will learn:
* How the fears, dreams, and actions of millions of baby boomers
will control the economic future and the markets
* Why the old advice "Buy, hold and diversify" can lead to
financial disaster
* How another stock market boom is on the horizon before the
the big bust---and when Rich Dad predicts it will happen
* How to build your own personal financial ark to stay afloat
amid the turbulent waters ahead and discover Rich Dad's
favorite investments, including tax free bonds that
earn over 7% and more.
Be prepared and stay ahead of the curve. "Rich Dad's Prophecy" willdo more than convince you of the coming stock market crash. it will show you how to build your own personal financial ark
that will make sure you not only weather the storm but profit from it. And you'll profit well.
On the other hand, if your only strategy is to listen to your broker, then you will certaintly end up---BROKER!
In the 1980's, some wise investors warned of a coming crash. Unfortunately, many disregarded this warning and got nailed in October 1987.
During the 90's, again some were warning about a "bubble", "markets had gone up too far", "some dot.com stocks had taken the "e" out of "p/e" were without earnings."
Nonetheless, some people chose not to listen and got burned again by the biggest stock market crash (so far) in history.
Robert Kiyosaki, despite the erroneous comments by some reviewers who obviously didn't even read the book, is not just advocating real estate. He also advocates stock market investing, hedgeing and other strategies. Kiyosaki did say that there would be a boomin the markets and this was at a time when the bear market was at it's peak. Many of us will recall just one year ago when this book came out how widely critized Kiyosaki was for suggesting that the markets would rebound. But what happened in 2003?
I am not in any way associated with Robert Kiyosaki. For my money, I see a 1990's type of growth in the stock market. MArkets go down and markets go up again. With President Bush's tax plan which is already stimulating the economy and the stock market, the wheels are already in motion.
Then I see another March 2000 selloff coming at the end of the decade interspersed with bullish and bearish type markets like we saw in 1994 and 1998.
Then when babyboomers retire.....??? We'll be prepared for that, er, unlike those who were not prepared in March 2000 or October 1987.
The moral of this story which we were all taught as children is to simply: 'Think for yourself and assess the siutation appropiately'. Don't let other people's fear dictate your course of action or you might wind up dead.
It's ironic when I think about it. Kiyosaki preaches about being your own person and not following the crowd, and yet here he is having created a gigantic crowd of followers so fearful of their own descision making and impending doom that they'll do whatever he says. They're running out in the open doing exactly what he suggests without any thought or question.
If you want to build a business then fine. I am not against that, I too am a business owner and have nothing against other people trying to make their dreams come true. In fact I encourage it.
But who is the wolf here?. It is the man who is making money off the panic frenzy and licking his chops as his bank account gets fatter and fatter because people couldn't think for themselves.A man with 3 divorces behind him, no kids and no other credentials besides his own books for which people can look up to. Funny as one reviewer points out, Bill Gates , Warren Buffet and Michael Dell did not rely on any special financial advice to build their own empires. They thought for themselves and carved out their own empires.
Will there be a big crash, well only God really knows. The truth is, that even if there was real estate might not save you as values might plumet. I can understand why everyone is so scared though, nobody wants to be a bum and have to scavage for food. That is their worst nightmare. But look at the other side of the coin, Kiyosaki has created a bunch of followers who are blindly tearing each other apart over real estate. History has always proven that the markets go back up after a crash and it will if there is ever one. Perhaps the government might solve the problem. Warren Buffet was once quoted as saying that he couldn't predict the future outcome of the market, and if he can't then what makes Kiyosaki qualified to do so?.
So please people, think for yourselves. You are so much smarter than this author gives you credit for.
Also, certain little inconsistencies in his description of "Rich Dad" in RK's many books have made me wonder whether the "Rich Dad" character is just a fiction, meant to grab the reader's attention. I now tend to think so, because RK has never, in any of his books, provided any factual details of who "Rich Dad" really was - probably because he never existed. If "Rich Dad" was in fact one of the richest men in Hawaii, as RK claims, he must have been well-known to many people there, and elsewhere. So where is the harm in revealing the name of a long-deceased person? But a fictional character allows the writer much more latitude and writing freedom. I also find it very hard to believe that "Rich Dad" (if he even existed) was as prescient and forward-seeing about all things business, as RK's books would have you believe. More likely, RK took his latest theories and ideas (based on another author's book), and applied the "Rich Dad" character and formula to them. Voila! Another best-seller!
Despite his prediction that there will be a stock market collapse, RK never strays from his basic message, which is: buy real estate. Realtors everywhere must love this guy. While buying real estate may have been good advice in 1970's Hawaii, it is not such good advice now. Real estate is currently so horrendously over-priced and over-valued, that in the event of a true 1929-style stock market collapse and depression, it would depreciate very fast, and wipe out most of your investment. And, as other reviewers have noted, who will be able to afford rent payments when so many people are unemployed? Not to mention the lack of financial liquidity and personal mobility in having most of your money tied up in physical structures, which cost you a lot of money in the form of real estate taxes, insurance, and maintenance. RK seems to take for granted that renters will magically always be there, handing you rent money, no matter what happens to the economy. To me, that is a fallacious assumption, and bad advice. There have been several articles recently in the Chicago Tribune about the increasing number of landlords that are desperate for tenants. And things aren't even that bad yet! If the 1929 Depression happens again, long-term unemployed people will be forced to do what they did then, which is move in with relatives or friends. Or they might even have to seek public housing. Obviously they would not be able to live in any apartment, because the rent-hungry landlord (you, if you follow RK's advice) would kick them out.
So, while RK's books are entertaining, easy to read, and really "draw you in," one should always keep in mind that they are mainly tools used by the author to sell his products. A glance at the "Store" section of his website ... should convince you of that. If you bought all of the products listed there (and I've bought too many already), you would indeed be "Poor Dad," and none the wiser for having done so, since there is very little "how-to" detail in any of his products.
I hate to be so negative, because I really do enjoy the "Rich Dad" books, and I agree with the philosophy of being your own boss. I just don't think that the advice RK constantly gives to buy real estate is necessarily good advice. If the stock market does collapse and real estate values also collapse, that would be the time to buy real estate, assuming you still had a job and any money left to do so. But repeating "buy real estate" like a broken record, regardless of economic conditions, is not wise advice. In the end, RK's books are just another example of the innumerable "Get Rich By Buying Real Estate" genre of books, which only enrich their authors. Usually, when everyone agrees on a "hot career," or a sure-fire way to get rich, that is the time to walk away from it, because the real opportunities are already gone, and the idiots have now moved in. RK obviously learned well from P.T. Barnum (founder of Barnum & Bailey's Circus), who reportedly said, "There's a sucker born every minute." Don't be one! People like John D. Rockefeller and Bill Gates did not become billionaires by listening to common advice found in books - they charted their own destiny. Think for yourself!
So, even though I definitely don't endorse Kiyosaki's financial advice...I definitely encourage you to find your own path, learn from your errors and keep improving.
I have a big problem with Kiyosaki because I have lost respect for him. I don't believe that he's interested in helping others to the extent that he claims to.
He keeps publishing books with the same message over and over again. He never gives any 'concrete' plan on how to become rich in real estate, his investment of choice. His financial advice is very vague...I believe if you were to follow some of his advice to the letter, your gonna get thrown in jail if you get caught.
I think that one of the statements he made in Rich Dad, Poor Dad is very revealing. He said that he's a best-selling author, not a best-writing author. That tells me that his priority is in making a profit first. Ethical values take a backseat. The very title of this book is meant to inspire fear and get you to buy the book right away. Kiyosaki definitely knows how to sell his products.
Perhaps Kiyosaki didn't believe the message inside the book was good enough. Perhaps Kiyosaki has a different set of priorities. Now, I understand that the purpose of business is profit. No profit equals no business. But I also believe that a business can be run ethically and still be successful.
I bring up ethics because I've recently read several articles from Smart Money magazine and other sources where Kiyosaki seems to change his story and Rich Dad's identity from time to time. It's been my experience when this happens, the person telling the story is lying. When your business and product (Rich Dad's advice) is built on a foundation of lies, it becomes difficult to keep the story straight. He sells board games at $200 a game. He has seminars that are thousands of dollars. He's not exactly making his message accessible to the many people who may desperately need a real plan right away.
If your going to take financial advice from someone...advice that could possibly make or break you and your family...don't you think it's important to have faith that the person giving the message really wants to help you? That helping you is his first priority? Would you take martial advice from a person whose been divorced 3 times? Would you allow your child to be taught by a teacher who is a criminal? A person's integrity is very important if your going to take their advice to heart and follow it.
If your going to read Kiyosaki, be wary of following any of his financial advice too closely. Kiyosaki is definitely correct that if you work for someone else, you will never achieve freedom. Your income determines your quality of life and your employer determines your income.
Educate yourself on building your own business. Invest in preparation instead of a quick fix (i.e. daily stock trading). I believe that working harder IS working smarter.
The first problem is that it makes a long range prediction of a stock market crash which never works. The literature is filled with books that have predicted crashes (such as Prechter's books) which have never come true. It's easy to come up with reasons why the stock market will crash. Doomsday scenarios are a dime a dozen.
The second big problem is the author's advice about how to survive the crash. The best advice would be to sell stocks short, buy put options, sell stock index futures, and things like that. But, the authors don't discuss those very obvious things.
The authors solution is to buy real estate and start a small business. But, in a real stock market crash real estate plummets in value and small business fail.
There is a big difference between a stock market crash, like the crash in 1929, and a bear market. A real stock market crash would devastate the entire economy of the United States, and probably a large part of the world. Real estate and small businesses would not be a safe hiding place.
The fact that real estate held up well in the last bear market should not fool you into thinking that in an actual stock market crash, real estate would be a good place to be.
After reading Rich Dad's Prophecy, I am prepared for the baby boom crash just like I was prepared for the big stock market bubble that burst in 2000.
Knowledge not fear is the key to investing. Follow Kiyosaki and Lechters advice and you will be a financial winner too.
Secondly is investing in real estate such a good idea?. Yes, prices will drop tremendously. People will be begging to sell their houses so that they will not be strapped to debt. It will even be good because flat and depressed markets are the ONLY markets in which you can get people to cough up high rent prices. Oh forgot to say this, who is going to pay you high rent when everybody is suffering?. Not many people. In addition, if everyone does what Robert Kiyosaki says there will thousands be people trying to play land lord and competing with each other on rent prices and service. Some may be wiped out, even then.
So enjoy your happy future as a land lord. What's this I hear?. You'll hire management company and be laughing on the beach while everyone is stuck hiding in fear. Well, it won't be much of a paradise either. How can you enjoy yourself in a tumbling economy, with no one to serve you and few if any businesses around to offer you what you want.
I really hope there isn't a big crash, it is nice to prepared. All I'm saying is that RK doesn't exactly tell you of the other side of the coin, which is vital to the decisions you make about your future.
Second, if there really is a huge crash in stocks, real estate values will likely drop considerably. The economy as a whole will fall, rents will drop, and small businesses, which in the best of times, fail at a rate of about 95%, will go out of business in droves.
So the advice to get ready for the stock market crash by opening a small business and buying rental real estate makes no sense.
So, this book really has very little to offer from a practical sense.
And now there's this nice conspiracy theory that basically says ERISA was brought about to screw workers over. That it's a terrible thing, that investing in the stock market is a disaster waiting to happen, and we're even told the year that the world will come to an end. Heavens to Betsy!
It's laughable. ERISA is/was a huge benefit to workers. Nobody can possibly predict what the stock market will do 13 years from now. Nobody even knows what it'll do five minutes from now. Foreigners could take up the slack. New immigrants to the US could take up the slack. Any almost infinite number of things could happen.
Besides that, if the stock market really does crash at that time, guess what? Every type of real estate will crash in value, small businesses will go out of business by the thousands etc. etc. There will be no place to hide except for cash. You certainly will not want to be a big rental or commercial real estate investor at that time. Or a small business owner unless you sell something that people can't do without, like medication or food.
If you want to read this book for entertainment go ahead, but take it out of the library. Don't give this charlatan another reason to laugh all the way to the bank.
If you've read some of the Rich Dad, Poor Dad books before, the main new information in this book is an explanation of why stock market investing with pension money is a dangerous way to grow your "wealth." In addition to being at risk from con men, thieves, incompetents, brokerage houses and market volatility, you face the ticking time bomb of a growing number of investors being legally required to liquidate their holdings beginning at age 70 1/2. As the Baby Boom generation turns 70 1/2 beginning in 2016, the selling moves from being a trickle into being a torrent that overwhelms new funds into the market at some point . . . followed by an inevitable collapse in stock values. If you want a more detailed, confirming discussion of this issue, the book, What If Boomers Can't Retire?, is a good choice. Harry S. Dent, Jr.'s demographic books also look at this issue.
If you already believe in the messages of the earlier books, you could skip this one . . . especially if you have already decided to avoid or minimize stock-market investments.
If you have read none of the Rich Dad, Poor Dad series, I suggest that you start with Rich Dad, Poor Dad before tackling this one. You'll understand this book better if you do.
The other problem with traditional defined contribution pension investing (usually by 401-k plans), of course, is that a pension fund contribution takes lots of cash out of your pocket (unless the employer matching is very generous -- way more than 2:1) to put some money into the retirement account. So you face the possibility of being much poorer in cash flow while you save for retirement investing and poorer when you cash out of the investment after you pay the taxes on what you take back in what could be smaller values. Imagine if you had had to start withdrawing from your pension fund in 1929. That's one nice illustration that I enjoyed in the book. Possibly, the same could occur after 2016. Who knows?
The second half of the book advises you on how to build a financial ark against hard times by relying on building cash-generating businesses and investments (such as rental properties) after you achieve your financial education (which you didn't learn in school, even if you got a business degree from most schools). You are encouraged to start small and develop various kinds of control over your emotions, advisors and actions. It's all sound advice. My only complaint is that people who are going to start making real estate investments and building cash-generating businesses need a lot more information than is here. I graded the book down one star, accordingly.
The first half of the book could have been shortened up quite a bit, but for those who are unaware of the demographic time bomb's potential effect on their investments, it may help to get the story in small doses.
The surprise for a lot of people in this book is going to be that what they hear every day from best-selling "authorities" about the "right rules" of retirement investing could easily turn out to be wrong for them.
After you absorb and begin to apply these lessons, I suggest that you think about where in your life the conventional wisdom led you down the wrong path. Where else could that be happening to you now?
Donald Mitchell, co-author of The 2,000 Percent Solution, The Irresistible Growth Enterprise and The Ultimate Competitive Advantage
This was actually my first reading of a RDPD book and sort of threw me for a loop because it contridicts most everything us "smart investors" thought was right and followed religiously. But the way he explains everything it makes sense and make you open your mind. You may not want to follow his advice but it is good to know.
My only complaint was that the book could've been condensed to about half it size. There is a lot of repition, but maybe this was intentional. In a nutshell, the book basically states that some time after 2010 the stock market is going to crash because all the baby boomer will be taken money out of their IRAs and such.
A definite recommend!
If you want to be rich, are you gonna listen to a millionaire or your next door neighbor?
Anyway, this book could possibly save your life. Yes, it doesn't tell you what exactly to do. Why should it? We are all different. But if you knew what was coming down around the bend, and it isn't pretty, maybe it will wake you up to the fact, that the only thing that can save you is yourself. Use this book as a platform for learning the tools needed to protect you and yours, literally.
If I reach the goal of wealth that I have set for myself. And I ever meet this man, Robert Kiyosaki, I will give him a firm handshake, big hug, and beg him to join me for a very expensive dinner, because he literally had saved my life.
In my view Kiyosaki adress head on the emotional (and discipline) problem of accepting to take charge of your own (financial) future. It's also onteresting for those who start wondering about retirement in 2003 and are ready to be desillusioned about making it without financial literacy.
The two criticisms which I will make to this book (and to all Kiyosaki's book) are:
1) that it is a bit repetitive. There is new idea in each chapters but always meddle inside a flow of other ideas already explained in a previous chapter which confuse a bit is expression and, to my opinion, his message.
2)that the rich dad poor dad metaphore although expressive is a bit pathetic. At the human level what too think of someone who always speak of his real father as "poor dad" and of his father best friend as "rich dad"? There is a lack of vulnerability here that I find bizarre, especially from someone who specifically adress the emotional side of what it takes to become a real investor and business owners.
He made his money through starting his own business, and succeeding. Great, but I'm not at all sure that he gives any real insights that would help anyone else do the same. Plenty of rambling, not much substance.
Disappointing.
... Kiyosaki encourages anyone who cares to take the time to really listen to do what he does: choose knowledge and freedom over ignorance and security. He points the way, and you have to honor him for that. He does not simply talk a good talk. He has proven that he can MANIFEST what he is talking about. His ACTIONS speak volumes, while the WORDS of many others walk off into the sunset of another wasted day of listening to foolish advice given by people who are still living "inside the box."
... The bottom line: educate yourself about business ownership, residential real-estate, and commercial real-estate investments - and begin to transfer your savings into properties that will support you NOW as well as far into the future. Transform liabilities into assets. Invest in what WORKS to give you a better RETURN on your investment. Most of all: choose freedom over security - and help others to do the same once you have mastered the ways of freedom.
... Kiyosaki says some very interesting things. I am not so sure about Rich Dad's praise of our American capitalist system's nobility as stated here on page 114: "Rich dad was very optimistic about America. He said, "Although America is a military power, it does not use its military power to take. America uses its military to protect its lines of commerce as well as keep order in the world. America is also a business power and a business power has the ability to create rather than take." He would say, "It's time to use our business power to create solutions to this very big problem of how a person survives once their working days are over. If we as a nation solve this problem, America can evolve into an even greater world power." ... Fine sentiments - but tell that to the MILLIONS of Native American Indians still living in poverty on RESERVATIONS in this country, land we TOOK from them! Tell that to the Chileans, the Guatemalans, the Panamanians, the Philippinos, and the Mexicans. I could go on.
... Nevertheless, Kiyosaki goes on to say this on page 136: "Years ago, rich dad said to me, "If you want to find true financial security, or even become financially rich, you must play your own game. Don't play someone else's game." After ERISA passed into law, rich dad felt that millions of people would be forced to play Wall Street's game. Rich dad said, "The problem with playing Wall Street's game is that Wall Street is in control and you aren't. Find your own game, become good at it, and then take control of your life." " ... And on page 149, he rebukes greed, irresponsibility, and the lack of accountability in business with these words: "Too many of these very bright students become captains but lose touch with the workers, the real engine of business. When people lose touch with their workers, then disasters like Enron happen. Did those so-called well-educated leaders recommend that their employees buy shares of the company while they were selling? It may not be technically illegal, but to me, it is definitely unethical. The problem is, this practice of recommending a buy while in fact you are selling is a very common practice not only at Enron, but it is a common practice in business, especially the business of the stock market." ... Wise words from a wise man! ... - The Aeolian Kid
Dismayed at losing the deal that I had won, my competitor asked me where I learned about real estate and why I was an investor.
I told him that I was inspired by the Rich Dad, Poor Dad book and Real Estate Riches but also had a library of other books and had a local mentor who showed me the ropes to get me started.
This man became furious. You guys are sapping the market", he shouted. "Too much competition...you can only slice so many pieces out of the pie", etc., etc.
Interesting because we live in a city with a metro population in excess of 2 million people. Lots of homes. Later I found out that besides us, there were only two other bitters! I suggested that he rethink that "Too much competition" theory of his.
In any event, it became crystal clear to me why so many people are bashing Kiyosaki and his book. They are afraid of "too much competition" In short, they are trying to monopolize the markets and keep it all for themselves.
In another regard, the media is after Kiyosaki as well and for good reason. The media doesn't like a hero and to millions of people, Kiyosaki is a hero, bigger than life. Rich Dad, Poor Dad has been on the best seller lists now for what 133 weeks? I bet that other authors who have never made the best seller lists and write financial books and articles are not too happy either.
Kiyosaki makes millions while they made thousands. Hello!
There are also masses of people addicted to the media. While they applaud when someone wins the lottery, they look with ambivalence upon someone like Kiyosaki with self earned wealth and look forward to seeing them fall.
How many times have we heard that Kiyosaki filed bankruptcy and failed in business before? Hello!!!
I think the fact that Kiyosaki came back andis sharing the wealth is significant. Sharing is a key word. My real estate competitor needs to lear some lesson here about sharing.
I didn't see the articles published in the magazines mentioned. I stopped reading those publications long ago because to me they are just catalogues for their advertisers and offered very little in the way of personal finance or wealth building info.
Ditto for websites that purport to have some inside information on people. These websites are like The cheap tabloids sold in supermarkets and like other forms of the media have an audience addicted to their product.
I don't buy those magazines or visit those websites, instead, I prefer to get good solid advice from local mentors who are actually succeeding and have a desire to help others, just like Mr. Kiyosaki.
Mr. Kiyosaki is ahaking things up. I suspect the media blitz on him will get even worse before it gets better. Regardless of the outcome, I am grateful to Mr. Kiyosaki for at least inspiring me to start in this carrer, to create passive income, to get out of the rat race.
In closing, I feel that the average Kiyosaki student is making far more money and is far happier than the bashers who attack him.
Good luck and Godspeed.
Kiyosaki is simple and straight forward with his ideas. I personally don't care if he really has a "Rich Dad", how much money he's making.... I care about listening to, evaluating and understanding his persectives.
To tackle this topic appropriately, an author would have to have a phD in Economics.
Could Kiyosaki's prediction come true? Possibly. But if it does, it will be merely coincidence and not play out in the manner he described or for the reasons detailed.
RK is just trying to scare people into buying his book. If you want to build wealth, there are many other books that actually teach you how to do it. Try reading them.
Now, with his new book, "Prophecy", the author hopes to cash in on people's emotions riding on the current stock market crash. In this book, he cautions people that there will be another crash coming up in 2016 because a lot of people will be withdrawing from their 401k plans for retirement. How can anyone predict what people will do with their money? Some people may keep their money in stocks till the day they die, some may convert to bonds ten years before retirement, others may do it five years ahead, and so on. Anyone that thinks this prediction is reasonable needs only to think alittle bit harder.
Let's look at the author's solution to this problem: build new businesses and invest in real estate. In case you don't already know, eighty percent of new businesses fail in the first five years. Hardly a non-risk venture. And surely you heard what happened to the Japanese and Florida real estate market in the past (should do some reading if you haven't).
OK, I admit, an investing magazine has every right to trash him for what he wrote in "Prophecy" (although they really did uncover a lot of trash on him). But let's look at some facts. His biggest supporter who was instrumental in making "Rich Dad, Poor Dad" a bestseller is Amway. Amway! That's enough to build my trust. Also, just look at all the products the author is pushing at us - expensive games, a whole library of "Rich Dad" books, seminars. Where does he find time to be a millionaire? Let's look at some truly rich people, Bill Gates and Warren Buffet, each who has written only two books. The point is, rich people are too busy making money from what they do, they don't have time to do all those seminars or write so many books. The author is rich, alright, and he has gotten that way from your purchases!
As with apparently other of his books, Kiyosaki presents an important concept (here, the fact that baby boomers will be retiring between 2010-2020 and potentially impacting the stock market) but he doesn't provide any detailed information that will help the reader actually do anything constructive (nor does he provide any theoretical explanation or insight into the problem). Unfortunately, as other reviewers have pointed out, after introducing the concept at a very simplistic level, he just keeps repeating himself over and over (and over!) again. He also shamelessly promotes his other products throughout his books.
I wasn't satisfied with the Cashflow book, but I wanted to give him a second chance with this book because the basic idea is an important one. I have now come to the sad conclusion that his books are primarily designed as a means for him to make money -- unfortunately, from from financially unsophisticated dupes such as myself!
After reading the book, I sincerely doubt that he even had a "rich dad" mentor or made a significant amount of money prior to inventing the "Rich Dad/Poor Dad" product line. IF he did have a good mentor, and IF he made money in Real Estate and other businesses BEFORE his current "Rich Dad" venture, then how did he end-up HOMELESS while starting the new "Rich Dad" venture? If all of his other investments had been that successful, then he would have had at least some resources left over from them to pay the rent while he started "Rich Dad" (read his bio and think about it :)
Please be aware that there are many other more informative and effective resources out there other than Kiyosaki.
author quotes selectively from warren buffett and alan greenspan to prove his point - which is what? rich dad thinks there's going to be a big big big market crash due to population dynamics, fear, ignorance.
so rich dad says don't invest in your 401k. wait. he says do invest in your 401k. but start buying rental properties like rich son (or does rich son say that?) or save more money. but don't save because saving is not investing. build yourself an ark. do it with rental properties like rich son. invest in
an ira or a roth ira. wait, don't. taxes taxes taxes. build yourself an ark. the crash is coming. don't eat dogfood. china is the problem.
the author's whole age-wave analysis is so messed up he doesn't even recognize china as part of a solution rather than an imaginary part the problem. the author doesn't take into account globalization, productivity increases, and recent US census population surprises in his doom-and-gloom social security, market-crash scenarios. all is out of whack in this book.
i was extremely disappointed and underwhelmed.
I was well on my way to being indepenent (I own 12 dbles in one company, and a dble and triple in another plus parts of 3 other small companies) before I read his books. However they did give me some much needed insights.
BTW--on pg 156 the author talks about turning ordinary things into gold. It is possible to do so w/fusion, etc. It was first done in 1972 (it had been reported earlier but not documated) and again in 1980 (by Glenn Seaborg). However it costs more to do then the gold is worth. If I remember correctly it cost about $10,000 a oz to turn lead into gold.
A good read overall. I hadn't thought much about what will happen to my health costs when I retire and that got me to thinking I may need more money to retire than I thought. My goal has now been raised from 3 million to 5 million. I'm about 1/2 of the way there now so it will take a lot to get there in the next 15-17 years.
And I liked his idea of using a ark to represent your plan to be wealthy.
The authors also offer useful ways for people to think about and provide for the future. There are, however, many more options, some of which may help avoid the catastrophe they predict. For a broader explanation of the problem and more alternatives for approaching it, readers might want to look at my book, "What If Boomers Can't Retire? How to Build Real Security, Not Phantom Wealth" that is also available from Amazon.com
Thornton Parker
Washington, DC
This book tells why we can NOT rely on our government to take care of us financially especially when it comes to social security, our 401k's, and IRA Investments. We think our 401k's and IRA money will be there when we retire because we invested it ourselves. After reading this book, you'll find out that is not the case.
I score this book a five. This is need to know information.
If you are all saying he is so right, then are you all moving to China? He preaches what a lousy place the USA might be in 15 to 30 years. Are all of you quitting your jobs and starting to buy houses you won't live in that give you money. And starting businesses that you sell later for a profit. Even if you know what he says, and he's right, 95% of the USA will still get squashed. I think I'm missing something here. Why is this a good thing?
Matt
One frightening scenario lies in this book. Kiyosaki and Lechter make
a strong case for a disaster in the stock market, a disaster caused by
the Federal laws on retirement. These laws took the responsibility for
retirement off the corporations and placed it squarely on the
employees. The problem is, these employees have little to no financial
literacy in trading stocks, so they -- the chickens -- have to rely on
"investment advisors" -- the foxes -- to manage their investments.
By the end of the book, you'll know what's the difference between a
"defined benefit" and a "defined contribution" retirement plan. You'll
become familiar with a law called ERISA, "the source of all retirement
evil", and you'll be confronted with a cynical view of individual
retirement accounts -- even of the highly-touted Roth IRA whose
advantage is you don't pay taxes when you start withdrawing. If you
didn't know already, you'll find out that the Social Security Trust
Fund does not hold a big pile of cash, but a big pile of IOUs.
After scaring the wits out of you, authors Kiyosaki and Lechter
describe the way you can avoid the disaster. It all starts with
financial literacy, and "financial literacy begins with a financial
statement." This means learning not only to read the financial
statements of companies you invest in, but also to use them in your
own household and personal finances.
Once you've got the basic tool of financial literacy down, you can
survive the coming flood by building your "ark." The ark is built of
three materials: businesses, real estate, and -- yes -- paper assets,
to include the stock market.
The authors hope they're wrong about all this. But they make a
compelling case to act and take control of your own financial future.
If the stock market and other markets are based on differences in opinion, what happens when you educate the masses to do the same thing at the same time? In other words, as the popularity of his books and ideas gain currency, will that not make it MORE difficult to profit from them, as markets are always in need of differing opinions? I know many friends who are buying up junky 'investment' properties like these books suggest, but it seems like they're all too late to the party. Tough to say if this information is really helpful when its promoting unilateral beliefs in fields that prey on those that are NOT aware. When everyone is more 'aware' then what happens?
The thrust of my argument is that he DOES tell you you how. The how is to constantly expand your financial prowess, and he tells you how to do that-- by reading everything you can get your hands on, by taking classes and seminars, and by getting out there and experimenting. I just bought an encyclopedic book on business. And even that doesn't cover everything. Just how much HOW can you honestly expect him to put in? We're talking about one of the world's largest and most complex subjects, and it changes every single day.
Many years ago I attended Tony Robbins' Financial Mastery seminar and author Robert Kiyosaki was one of the presenters. Being of the same heritage, I was happy to see a Japanese-American doing well in a public endeavor. He taught a financial game which was quite good, but after that seminar I didn't hear much of him again until the Rich Dad book came out.
The Rich Dad book was originally self-published but sold so well in its first year that Time-Warner bought out the publishing rights. As a fellow author, I figured that the series of books was something that was part of the publishing contract and that these Rich Dad books would come out regardless of the quality of the content. But in this case (Prophecy) I was wrong.
Mr. Kiyosaki addresses some key issues that have been largely overlooked by the financial media and therefore the public. Such things as: 1) financial assumptions like the stock market always goes up in the long term, 2) the negative effect of aging baby-boomers in regards to mandatory withdrawals from retirement plans, 3) the excessive number of mutual fund companies who are inheritantly bullish, 4) the lack of truly unbiased financial education, 5) the reality of higher costs in the future particularly medical expenses, 6) the negative economic effect of China becoming the low-cost manufacturer of the world, and 7) the essential need to take control of our own financial decisions and destiny.
What's interesting about this book is that all these co-factors are presented around the analogy of Noah's Ark, the ultimate story of preparation and anticipation. And while professional money people may scuff at this book's "average American" approach, it still focuses on the roots of financial problems, intelligent solutions, and timeless empowering beliefs.
While today's young investor may be looking for cutting-edge technology when I comes to investment advice, this book may be the better answer: street-smarts in a challenging, dynamic environment. I'll take the later any day!
I give this book a 5 star rating because it is a book whose time has come. This is the wake-up call for taking responsibility of our own lives by understanding the roots of future problems. Robert Kiyosaki has done a fabulous job in introducing and describing what could turn out to be the vital keys to either financial wealth or financial ruin. I hope that other will read this book and pass on its message to others.
It's also an enjoyable read!
But this one is quite boring as he just repeat what he said in his other books. May be it is thw way we can learn something. I still think you need to buy this book is because, it has some steps to suggest you to follow and some new idea. For example, China is going to be largest country in economy very soon. I totally agree with this point.
so........buy this book.
As for the reader from San Lorenzo, this book was released on October 1. I saw it in my bookstore on October 5, so it is HIGHLY probable that reader could have read the book and wrote the review on October 6. Don't be so suspicious.
And on a side note, I did purchase Cash Flow the game and have had Cash Flow parties. It is very fun and educational. It is amazing watching other people play this game. I keep winning the game, now just need more ideas on how to do this (and fight the fear) in real life.
Even after the latest stock market woes, I was still getting a lot of advice from friends and family about investing in mutual funds, IRA's and other popular paper assets. While this book hasn't completely frightened me away from the stock market, it has made me even more cautious than before. For many of you, the big revelations won't come as much of a surprise, especially the effect the retiring baby boomers will have on the stock market. I already knew about the coming social security crisis, but I never let the logic take me to the same conclusions about the stock market.
Kiyosaki is a big fan of real-estate, probably because it made him rich, but I find little fault in his advice. Granted the one thing he continuoulsy preaches is that to be a true investor requires a lot of work and discipline. There are no get rich quick schemes although you can get lucky breaks (luck swings both ways in my experience). Kiyosaki's books seem to preach a diet of self-control, knowledge, and even ethics combined with a forward thinking strategy that would almost certainly be succesful if applied to anything in life. The difference he brings to the table is his own tried and true experiences.
The only real problem I have with this and "Rich Dad, Poor Dad", is that Kiyosaki gets a little vague sometimes. As someone with very little business or investing experience, I wished he would give more specific examples of his own success examples of how to apply his advice in the real world. Some of the concepts would be easier to understand. I think Kiyosaki is worried that people would take his own examples and try to apply them versus coming up with their own ideas.
If you are thinking about starting an investment plan for retirement, or if you have been relying on 3rd party consultation to do your investing for you, you should definitely read this book. There are tons of good books out there on the stock market, but I don't think there are many out there giving alternatives. Real-estate and stock trading may seem a bit overwhelming, but allowing your future to be controlled by the mob of questionable brokers out there is far more frightening to me. The language is simple and easy to apply and almost anyone can understand it.
The rest of the book is a re-hash of Mr. Kiyosaki's first series of books. This book has the same "vagueness" as his other books. It tells you to become an investor without telling you what to look for in a good investment. It tells you to buy real estate without giving you a clue on how to search for a good piece of property. Then there is the sales pitch for the over priced Cash Quadrant game...
Please save your money.
As for the Defined benefit vs. Defined contribution issue, that was covered in The Retirement Myth by Craig Karpel, a book that RK himself sites in the book. I read that book and nothing new was in RK's book.
The second part of the book goes into how RK built his ark, his Biblical metaphor/analogy of how Noah built his ark before the rains came, and was able to retire at the age of 47.
After that, the second half of the book goes into the 8 investor controls people need. Some of them are new, most are taken from his 6 previous books.
If you're familiar with the dig on Kiyosaki's books that they're more "WHY" instead of "HOW TO," this book is yet another "WHY" book. If that's what you're looking for, buy Rich Dad's Prophecy. It was an entertaining read, but not worth the [money]. I'd skip it and borrow it from a friend or from the library. Read Karpel's book and re-read all 6 of Kiyosaki's books and invest the [money] instead.
With an aging population, turmoil in the stock markets, and lack of knowledge about how much money is needed for retirement, author Robert Kiyosaki gives specifics to support his theory about predictable problems facing those who hope to retire.
The book won't appeal to people who are satisfied with their current job and have no plans to change in the future. But for those who care about government policy and how these policies and demographics are impacting our society, the book is eye-opening as well as easy-to read.
The "rich dad, poor dad" vehicle gets old but is stiff an effective and sometimes entertaining vehicle for conveying information.
However, there are many flaws in ERISA that very well could lead to a market disaster that will wipe out the retirement plans of millions of people. That Wall Street analysts and financial planners have been silent on these flaws is deplorable. That legislators have not moved to deal with these flaws borders on criminal.
In addition, increasing life expectancies (and health care expenses) are creating increasing burdens on citizens to prepare for retirement. Unfortunately, we have several generations of people who will not be close to adequately prepared. This is a social disaster in the making.
Kiyosaki sounds like an alarmist, but that may be the only way he can make the point effectively.
I had a feeling once about mathematics -- that I saw it all. Depth beyond
depth was revealed to me -- the Byss and the Abyss. I saw -- as one might
see the transit of Venus or even the Lord Mayor's Show -- a quantity passing
through infinity and changing its sign from plus to minus. I saw exactly
why it happened and why tergiversation was inevitable -- but it was after
dinner and I let it go.
-- Winston Churchill
A transistor protected by a fast-acting fuse will protect the fuse by
blowing first.
