Do you know the 8 new rules of money?
Do you think that the rich have some sort of “conspiracy” against the middle class and poor–in other words, ways to make themselves richer at the expense of the middle class and poor?
If the answer to the first question is no and the answer to the second is yes, then I think you should definitely read this post. I must admit that before I read this book, I did not know the 8 new rules of money (heck, I didn’t know any rules) and I certainly did think that the odds were “stacked” against me becoming rich.
After reading this book, I have a much clearer understanding of why the rich get richer and the poor and middle class get poorer. It comes down to this— the rich are keenly aware of and play by the new rules of money (they have the financial intelligence to do so) while the poor and middle class lack the financial intelligence and thus are unable to do so.
Here is my critique and personal thoughts about Rich Dad’s Conspiracy of the Rich- The 8 New Rules of Money, written by Robert T. Kiyosaki.
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Brief History Regarding the History of Money
Before I discuss some of Robert’s 8 rules of money, I think it is important that you have a basic understanding about the history of money. Prior to 1971, the US dollar was a derivative of gold, meaning that the dollar was worth a certain amount in gold. Once President Nixon took the US dollar off the gold standard in 1971, the US dollar is now a derivative of debt. Basically this means that the US government can now print money in unlimited amounts to keep the economy afloat. Today, the US dollar is backed by nothing but the good faith and credit of the US government. In other words, the US will no longer redeem dollars for gold. As long as the rest of the world continues to accept our debt as payment for their goods and services, all will be fine. If however, the rest of the world stops accepting the US dollar, our economy as well as the world economy will be in serious trouble.
I don’t know about you, but I want to prepare myself just in case the value of the US dollar falls to zero. I just cannot sit around and hope and pray that everything will be all right without taking some action. If you feel the same way, then it’s time for you to discover what the 8 new rules of money are.
The 3 Most Important Rules of Money (to me)
1. Money is knowledge—Robert states that it is possible to lose money in business, real estate, stocks, and gold. However, having the right knowledge (financial intelligence), can make you rich, while having the wrong knowledge or lack of it can make you poor. The more you make a concerted effort to increase your financial intelligence, the better off you’ll be.
2. Learn how to control cash flow—Now that the US dollar is based on debt, our economy flourishes as long as we stay in debt. Problem is that many people are in financial trouble because they have too much debt. Too much money is flowing out and hardly any money is flowing in. In order to be financially secure, you have to take control of your cash flow–find a way to have more money flowing into your pocket than out.
3. The need for speed—Over time, money has evolved from simple barter to digital money as the world’s financial system has picked up speed. If you are slow, you will get left behind. While the average person makes money by the hour, day, or month, a person with above average financial intelligence is capable of making money 24/7 (even while asleep). In this case, money is made by the second.
Conclusion: Is Rich Dad’s Conspiracy of the Rich Worth Reading?
Without a doubt YES. I think it gives great insight into why many people are having financial difficulties. I also liked the way Robert allowed people to provide online feedback on each chapter he wrote . He received many feedback comments such as:
- That formal education basically teaches one to take care of a company (as an employee) rather than create a company (as a business owner)
- If you don’t know the rules of money, you’ll always end up losing the game
- Creating passive income is important, because if you are unable to work due to illness, you would be forced to use your savings
This just demonstrates how many people are not as financially stable and savvy as they could be and they need to prepare themselves for the bad times that may come in the future.
Are You Satisfied With Your Financial Life?
Robert suggested that people do a self-examination of where they are today in regards to their financial status by asking questions, such as:
- Are you earning money 8 hours a day or 24/7?
- If you stop working, will money continue to come in?
- Do you have multiple sources of income?
I asked myself these questions, and honestly, I am not happy where I am financially. Reading this book has made me realize that I still have a lot of work to do in regards to getting my financial house in order. For instance, my investments are more in mutual funds (capital gains) than in cash flow. To date, I have one affiliate marketing opportunity that provides me a monthly cash flow (it’s less than $100, but I have the potential to make much more with a little hard work and persistence, lol) I am also working on investing in precious metals such as gold. For those of you who are also interested in investing in gold (at affordable prices), click here for more information.
It is my sincere hope that after reading this review, you be honest with yourself if your self-examination reveals that your financial house has some “holes” and needs repair. Whatever action you do decide to take, don’t procrastinate. The faster you get started making the changes you need to make, the better off you will be. Please feel free to comment on what I have written; I’m a firm believer that further discussion about Robert’s book will be helpful to all.