September 2025
Tune in if you’re interested in…
• The core lessons of Rich Dad Poor Dad, and whether they hold up today
• Understanding the difference between assets and liabilities in real life
• How entrepreneurs generally become wealthier than W-2 employees, and if owning a business is essential to wealth accumulation
• How mindset and discipline shape financial outcomes more than “hacks”
• Where the book may oversimplify, and how to apply its ideas more thoughtfully
Watch previous episodes here:
Ep. 153 Fed Meetings: Do They Really Matter?
Ep. 152 Why Too Much Cash Can Hurt Your Future
I found it interesting reading this book, Rich Dad Poor Dad. This is, I think, the second time I've actually read it cover to cover in my life. The first time was a long time ago. And then I've looked back at that book a few times because, in all honesty, it really changed the way that I thought about money and investing.
I kind of grew up very similar to Kiyosaki in the sense that, my parents always told me, you know, hey, go to school, get a good education, go work for a company, climb the corporate ladder, so to speak. And, you know, I look back today, and that's great advice. Very thankful for it. But man, it's a lot different than when you look out in the world and you see those entrepreneurs or the people that, you know, heavily invested themselves and, you know, got lucky in some degree or right.
And what they did, they're so much better off financially than some of the other people who just climb that corporate ladder. It's so fascinating.
Yeah, I remember reading it. I think I was 21, 22 when I read it for the first time, and it was already a 10 or 15 year old book at that point. And my dad walked into the room, he saw me reading and he's like, oh, I'm glad you're reading that book... poor dad! And so I was definitely raised with that, with that mentality of, you know, go to college, get a job, save for retirement, retire.
Like the typical process of building wealth, that is like the American dream. And Kiyosaki kind of flips it on its head. And what's interesting is I think that nowadays his view has become the majority view with young people. You know, a lot of people in their younger years, they don't want to just get a typical job, work for the same company for 40 years and then retire.
They're more entrepreneurially minded. So I think the effect of this book is really taking over the zeitgeist of the next generation, for better or for worse. We'll kind of get into that.
Without a doubt. And I don't like the whole term like rich dad, poor dad, because I don't think that you're poor if you chose to go get a good education and work for a company and build the corporate ladder, like it's just different advice. But the way that the book kind of skews it, I struggle with. The other part that I struggle with is Kiyosaki is really big on pushing, having debt to buy other assets.
You know, it's okay to take out a loan and go buy a company that's going to cash flow and bring you more money. But he also says that it's not good to go into debt to go buy your personal home. You should pay for it in cash, which is sort of a catch 22 there.
Yeah, it’s really interesting. And I think whenever you try to put anything in a box, you're going to get it wrong and in a certain way. And so like one of the things that he talks about is that your house is a liability, your personal home is a liability. But if you own real estate as a cash flow, as an investment, a source of cash flow, then it's an asset.
He makes that distinction between the two, and I think it's a little bit black and white to think of things that way.
And here's a good example as to why some people argue with you. Osaki. If I buy a house and it's not cash-flowing, but it's keeping me from paying rent. So there's an expense that I'm saving by owning this asset and then the asset also appreciates it. So when you compare it to the other options, it's clearly an asset.
It's just not the same type of asset as an investment property. But he doesn't get that nuance. And so that's what's kind of frustrating about the book.
I mean, it is technically a liability or for a savings account. Every time you make your mortgage payment, you're paying off a little bit of principal. And you're paying some interest over time. So you're building up a savings bucket that's sort of tied to your home. Yeah. I've never felt like a home is an asset. It's great if your personal home goes up in value and it creates wealth, but the only way to get that is to either sell it or downsize or move somewhere else.
So to me, a home is where you hang your hat and you want to have one that you're happy living in. Yeah, but it is much different than owning a piece of investment real estate that's paying you income.
That's exactly right. That's a totally different type of asset. But the typical American like, if you look at the statistics, the typical American's number one quote unquote asset is their home. And the typical American sees it that way. I buy a house so that it can go up in value. It's part of my retirement plan. I want to pay off my mortgage by the time I'm 65.
By the time I retire, so that I don't have any payments so that the liability is gone. And I think for the typical American that that is a good aspiration. But what Kiyosaki is saying, let's elevate ourselves to another level. Instead of you working for money, let's have money working for you. And I think that's the biggest. If I had to put the book into one sentence, that's it.
Instead of working for money, have money work for you. And I think the way that that changed my mentality when I read it was huge. And so then I pursued a nonprofit organization called Being an actor, and I and I never succeeded in making my money work for me, is that.
I love the way that you phrase that, because I think that this book resonates with people for that, that that same truth. Right. It changes the way that people view, investing or money. How to start investing earlier on, I know similar to you, in my 20s, I sort of chased a personal dream trying to play golf for a living.
I was not successful wealth-wise, but I had a lot of fun. I wouldn't be where I am today if it wasn't for those prior experiences. But what that caused it... it caused me to kind of have this scarcity mindset towards money a little bit. I knew what it was like to not have any. And so once I started making some money and saving, I was apprehensive to invest it.
Yeah, because I didn't want to lose that.
You never knew when the next paycheck was coming.
Correct. And so what I love about this is hopefully it changes the way that people think about money and really getting that paycheck and paying themselves first in the sense of, I'm going to start investing and I'm going to start building because, you know, compounding can be the eighth best wonder of the world, right?
I was just having a conversation with a friend yesterday, and one thing that Kiyosaki did really well was shine light on how the tax code itself is so preferential towards assets and businesses versus being labor versus being a W-2 income worker. And I think that's one of the biggest takeaways from the book as well. And so if you make money as a worker W-2 income, you're earning taxes, ordinary income, and it goes your income.
Then you get taxed, and then you're able to pay yourself for retirement. Whereas if you have a business, the business has its income, the business has its expenses. Then you pay taxes and then you can pay yourself. Just that difference in structure over a long period of time makes the business owner way more wealthy than the worker, just because of when it's paying taxes.
And so that's something that's hard for a lot of people to understand that I think they do need to get educated on that. You really are in a better position if you're a business owner than a W-2 employee.
No question about it. I mean, sometimes if you're a business owner, you can run personal expenses through the business. You know, car, cell phone, internet. Otherwise, you know, your W-2 employee, you're paying taxes and then you're paying for those things. Hopefully your business is successful and you can then have more assets left over to save and invest and buy those things that are generating more passive income for you.
Do you think that it's attainable for people today to be able to have their money work smarter for them, like a success?
I think that it's harder for people today just because prices are higher. It's easier to start a business today. If you can use AI, for instance, you can start a business a lot easier than 30 years ago. If you had to get on the phone and reach clients, right? I mean, the internet has changed things. AI is changing things as we speak, and so it's easier to become an entrepreneur.
I think it might be harder to monetize it. We don't. We don't know. But it is harder to buy an asset right now. And what I mean by that is the price of stocks, the price of companies, the price of real estate as a multiple of someone's income is a lot higher than it was for our parents’ generation.
And I think the statistic is that millennials are about 30% less wealthy than our parents were at the same age 30 years ago. And that's just because the ability to buy assets in the 80s and 90s, it was a lot cheaper than it is today. And so I think it is hard to go out and find passive income to buy that real estate property that's going to cover its mortgage with interest rates.
Really high, I think it's hard to find public companies that you can buy and that they're going to go up ten acts like the Microsofts did in the 2010s and Apple did in the 80s. And 90s and still on it. It's just it's going to be interesting to see if that same wealth growth applies to Gen Z, millennials and even Gen X in their later working years.
I mean, the devil's advocate here is if you look back over the last 40, 50, 60 years, home values, stock prices, all those things were at all time highs throughout the entire, you know, generations, you.
Know, always hitting new all-time highs.
So they're always expensive or more expensive today than they were, you know, last year. Yeah. I think that, you know, if people want to try to get ahead, they really have to be conscious about their spending plan and paying themselves first, setting money aside early and often enough to be able to start building wealth, because it's going to take time.
What I do love about this book, I mean, there's a couple principles that, that you can take away is that I do believe in some respects that that traditional mindset around, you know, just go and get a good education and get a degree and then go to find a job. I do think that that advice is a little bit challenged today.
I mean, if you're going to take on a couple hundred thousand dollars worth of student loan debt to go to, to go to school and get an education, you better make sure that you know your prospects for making money when you do get a job is enough to be able to pay off that debt. You know, taking on $200,000 with a student loan debt to get a job that's maybe paying 75, $80,000 a year.
That's a tough one.
It's really tough. And so there's I think there's two things to consider with this. One is the amount of debt that you take out matters, and the amount and the expected income matters, just like you said. And then secondly, just to know that broadly speaking, if you do get a college degree, you are much more likely to have higher income throughout your life.
Just having that degree statistically makes you a higher earner. And so there is a little bit of that risk reward when it comes to getting a higher education. You you probably do want to get it. But then on the other hand, if you don't go to college and just go out and start a company at age 18, you're 4 to 6 to ten extra years.
That you're developing skills as an entrepreneur, that your cash flowing off of that company while your peers are at school, spending their money to get their education. So I think there's a huge argument to be made for if you are an entrepreneur early focus person, then you might want to skip the higher education route and just get going on your business.
I mean, we're both parents. I've got two girls, five and two. I want to teach them a combination of this. I think education is one of the most important things that you can provide and, and have in life that that curious mindset, that pursuit to always try to improve yourself and get better at what you're doing. But at the same time, like I was joking with you last week, I kind of want to start a little business with my daughter too, where she's designing, you know, dresses or t shirts are hats because she likes the idea of, you know, certain flowers or colors and designing something, but then teaching her, like, hey, let's turn this into business. Let's try to sell some of this product so you can see that just because you sold this shirt for $20 doesn't mean $20 goes in your pocket. You know, you have expenses. You know, maybe it's $10 to buy the product and there's a profit margin and you've got to set prices up to where if you get returns or the cost of shipping comes in, that you're actually profitable.
It's an interesting way to teach my daughter about money. Yeah.
And I can see it now, her being on TV saying, hey, sharks, have you found that buying a dress for your kids is getting harder and harder and you're feeling, what was the thing that your dad taught you? You had a great quote that I think your dad said about checks.
Yeah. So when I was, I mean, I think I was in college and I got a check for something, and I had to sign the back and go up to the bank and deposit into my bank account. And he said to me on the drive over there, he said, hey, kid, would you rather be the person signing the front of the check or the back of the check?
And of course, 19 year old cocky me. I said, I want to sign the back of the check. That means I get the deposit into my account. He said, well, you might want to be careful with that mindset. Often times the person that signing the front of it has more money than the person signing the one on the back.
See that is a rich dad mentality. And that's something that I never thought of. I never thought of starting a business. I never thought of being an entrepreneur. And so the fact that you had your dad communicating that concept to you at a relatively young age, I think that there's something that needs to be instilled in young people, at least for them to know the option.
And I think this gets to our education system a little bit, like teaching personal finance, teaching the tax code, how business structures work, what you are as an employee versus an employer. I think just knowing how it works expands someone's knowledge to give them the option of, what do I want to do? Well, I want to be signing the front of the check, or do I want to be signing the back of the check?
Because not everybody is an entrepreneur. There's a lot of people who want to sign the back of the check.
No, not everybody is an entrepreneur. But that same mindset and skill and sort of drive that it takes to be entrepreneurial and create a business, those things still apply in the corporate world. Yeah. If you want to be successful in the corporate world, you have to continue to grow and develop yourself and have confidence and find ways to become better at what you're doing.
So that way you're more valuable to company if you take that same drive, tenacity, determination and mindset and you throw it to somebody that's being entrepreneurial, you're forced to have to do those things, otherwise you don't succeed. And so to me, what's interesting about this book is whether you choose to go to the entrepreneurial path or the corporate ladder path, your chances of success still rely on your ability to work on yourself and grow and gain knowledge and gain skills.
Yeah, those things hold true.
Yeah, I remember reading the book and getting so inspired by it. And again, this was I think I was 21, 22. It was during the great financial crisis. So I was like, all right, I need to get these multiple streams of income.
There's no end. You got to go start a business. And I found that I'm not an entrepreneurial person, like I, I don't have that mindset to go and create a product or find a new way of doing services. I like working on a team in the structure of a company. And so that was something that I think people need to know that if you are not entrepreneurial, you need to know that about yourself, because what is the statistics?
It's like 90% of startups end up failing 50% within the first five years. And the competition is really stiff, like there are 300 million startups every year around the globe. And you're not just competing with other Americans, you're competing with people in different countries because we're all so connected. So if you're going to go the entrepreneurial route, you have to know that it's in your bones, it's in your blood.
It's what you want to do. You want to work the 18 hour days and then the rewards are massive. If you succeed. But if but if you fail, I mean, that's the real risk to it. And I think that's the one thing that Kawasaki doesn't address is that he's successful. He succeeded. But there's for for him. There's nine other people who failed who aren't writing books about how to run a business.
And so I think everybody needs to know their own risk tolerance. If you go to the traditional quote unquote poor dad route, go to college, get a good income, rise through the corporate ladder, get some, you know, stock options, retire. That is a less risky and more likely path to success. But if you start a company, it's higher risk, less likely to succeed.
But if you do succeed, it's a ten x rate versus your employee friend.
I love the way that you phrase that. So optimist or pessimist okay. The school system will change in the next 20 years to include personal finance as a core subject.
So, I mean, I think that again, millennials and Gen Z, as we continue to have kids, we are obsessed with personal finance. At least my circle of friends is the Reddit threads are abundant like everybody's talking about it. I think that we're going to want our kids to learn personal finance in school.
I'm pessimistic that it will happen in school, but I'm optimistic that more people will be teaching their kids. Okay. Yeah, owning a home will be less popular financial goal for future generations.
That's a good one. I think that the pandemic might have changed things permanently on this, where it's like people moved around so much, they're working more remotely. And I think because we have the optionality of living in different cities more than we used to, I think maybe owning a home as a, as a place to live might become less popular.
But owning rent, like rental properties as a source of income will become more and more popular. I think that's the trend that we're on. What do you think?
I don't know, I'm a little bit 5050 on this. I think that the desire to own a home and have that American dream is still very much alive and hasn't gone anywhere. I do think that younger generations might feel a little bit deflated, you know, around here in Southern California, that the cost of living is so high.
Yeah, but they still find ways to kind of get it done. Yeah. They might be dual income, no kids until their mid to late 30s. But they, they're, they're saving earlier and often enough or have that drive or interest. Plus you look at the future wealth transfer they probably might inherit some money and own to own a home later on.
Just not right now. Yeah. The next generation will be better at handling money than this one. Optimistic.
What do we mean by this one? Baby boomers? I think baby boomers are the best financially. They're the best handling money of any generation. Truly. Yeah. I mean, they're so entrepreneurial as a generation. They work so hard. They they're still working, you know. And I don't see those qualities necessarily being duplicated in younger generations. It's just different value set.
So I think that the baby boomers are going to get the gold medal on money management.
I don't disagree with you. Thank you so much for the conversation.
