Very few, if any, people want to be poor. But unfortunately there are quite a lot, if not a maddening abundance, of things you can do to become — or stay — poor. Poverty isn’t a choice so much as it is a cycle and a tough one to break. It’s not just about making more money.
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Robert Kiyosaki, an investor, entrepreneur, financial educator and the author of the bestselling “Rich Dad Poor Dad” series of personal finance books, recently posted on his YouTube channel that he’s very concerned about the widening gap between rich and poor. He then highlighted four tips that those of us trapped in poverty should use to break free.
Stop Living Below Your Means
Kiyosaki doesn’t believe in the wealth-building power of living below your means. He thinks the entire principle is ridiculous.
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“You don’t get rich eating at McDonald’s,” Kiyosaki said, listing the unhealthy side effects of regularly consuming fast food.
Instead, you should be getting richer by having assets buy your liabilities.
“I always have Ferraris, Rolls Royces and all that,” he said. “They’re all liabilities. If it takes money from your pocket, it’s a liability. Assets, by definition, put money in your pocket.”
So when Kioyosaki goes to buy a $500,000 Ferrari, he does the following: He finds the asset to cover the cost.
Think Like a Capitalist
Kiyosaki champions thinking like a capitalist. This may seem obvious, given that we live in a purely capitalist society, but we may not be aligned in our minds.
To think like a capitalist you’ll need to build up your financial IQ, as Kiyosaki calls it. “That takes practice.”
People who live in poverty may be so focused on getting by and feel such pressure to live smaller and smaller that they don’t even consider the concepts of assets and liabilities and how they come.
Be an Entrepreneur
While being an entrepreneur simply doesn’t make sense for every adult, it does work for quite a few — and it’s becoming increasingly common to start your own business rather than toil away for somebody else’s. Based on Kiyosaki’s advice, this is how it should be.
“It’s a matter of structure of thought, discipline,” he said. “Can you keep your discipline? Can you keep focused?”
Invest In Financial Education
Kiyosaki is appalled at our schools’ lack of financial education and encourages people to educate themselves.
The CASHFLOW Board Game, which Kiyosaki designed with his ex-wife Kim Kiyosaki in 1996, might provide some educational insights.
“I learned everything just playing Monopoly,” Kiyosaki said.
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This article originally appeared on GOBankingRates.com: Robert Kiyosaki: 4 Tips To ‘Break Free From the Cycle of Poverty’
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