Is Rich Dad a Scam?
It’s a very common question, is Rich Dad, meaning Robert Kiyosaki the author and entrepreneur, a scam?
In short?
Note: This is not financial advice. You should consult your accountant or your financial advisor for any decisions you make.
Yes.
But you should still read the book.
Allow me to explain:
A lot of the arguments about the bestselling book Rich Dad, Poor Dad are about the supposed Rich Dad described in the story. He was proven to be fictional, and Robert Kiyosaki said that he wanted to tell a good financial education story. And I’m all for that, I think Rich Dad was a narration device, commonly used in many pieces of literature. Did you think Bilbo Baggins was real? No, but he tells us an epic story that moves you, inspires you, teaches you. Same with Socrates, was he real or simply a narration device used by Plato to test out his theories to the people?
So, yes, Rich Dad is essentially fictional. It’s not really important. After all, it’s easy to verify who it was supposed to be, since he’d be the biggest real estate investor in Hawaii. In an interview Robert claims that Rich Dad gathered up small pieces of land and combined them into a megaparcel that became a 5 star hotel in Waikiki.
I’m assuming he meant the Waikiki hotel in the board game, Hotel. Which I love. And Robert always mentions his love of Monopoly. But I digress, it is funny because this is easily verifiable. It’s public record and we could find out the name of this anonymous Rich Dad easily.
Again, it doesn’t matter.
You should still read the book. This book. Seriously, it’s cheap, just go and get a copy.
And I’ll explain why. In a completely different industry, we have the scriptwriting book, Save the Cat. Now, Save the Cat is basic, in that it explains the concepts behind storytelling in a very easy way. Serious scriptwriters consider it stupid and dismiss it. But, because it’s a bestseller, lots of people in the industry have read it. Producers, actors, directors. So, when you talk to a producer and he wants you to make the character more likeable, he’ll now be able to grasp the concept and tell you, “You need a stronger Save the Cat moment,” meaning we need a scene where the hero literally saves a cat or just helps out an orphan. Seriously, it’s a cliche but it works so well. Now that I’ve pointed it out you’ll never stop seeing it in any movie and series.
I firmly believe that in order to comprehend something, you need to create a concept in your mind and give it a name. So, just like with Save the Cat where the concept of humanizing the hero and showing the audience that this is the good guy, look, he saved the kid/cat/dog/granny from the car/burglar/volcano/collapsing building, here in financial education we have the concepts of Assets, Liabilities, Capital Gains, Interest, Cashflow, Debt, Leverage etc. Those are concepts that people struggle with. And a bestselling-book like this one helps the average Joe to grasp that concept. When they go to their accountant and they say, “well, your car is an asset so we’ll add it in your financial statement,” Joe will be able to say, “you mean a depreciating asset, right?”
The main argument against Rich Dad is that the concepts are basic and that every financial guy or gal in the world knows about them. Cool. And maybe they do. But the average person does not, and this is an easy to digest book that will help them get started. I read Rich Dad at an early age, I think just before I was 18, and I know it helped me understand the world a little bit better. No, I didn’t become rich, I didn’t retire at 21, and no, I didn’t start investing in real estate or in stocks. On the contrary, I spent a lot of money on stupid things. But I still had those concepts at the back of my mind and I would analyze situations around me. I was spending too much money on rent, and I was looking to buy instead of renting so that I could eventually own the property. I never pulled the trigger on the deal, but at least I was considering it. I started a corporation, which I messed up royally. But I did it at an early age, and that’s the best time to try stuff and fail often, when there are no family and kids attached.
Same with you, it doesn’t matter if Rich Dad is a scam or not. Hoo-boy, it really is. The website is one big upsell to his courses. Robert Kiyosaki is a classic boomer telling you how he became rich during one of the wealthiest times in the world, where essentially you could build an outhouse and it would be worth ten times more in a few years.
Seriously, it’s the classic, “When I was your age I had a house and a yacht and fucked the immigrant maid on the side.” They should shut up, my ancestors included. They don’t know squat about the new world. But at least Robert is attempting to teach you how to grab the opportunities that appear before you. Because just like in any situation, even Boomers didn’t all end up rich. It’s very easy to coast through life when everyone is making money and everyone is spending like crazy, thinking it’ll never end. This is exactly what happened in Greece in 1990, everyone was spending mad cash, banks were giving out personal and holiday loans, people were betting on the stock market, it was a nuthouse. And naturally, only the cunning few came out the other side with something to show for it.
Also, some of his teachings are solid. He tells you to get rid of your fear and learn to sell. One of the best ways to do that is by joining an MLM training program, I personally suggest Forever Living Products. By letting go of your embarrassment and fear of rejection, you harden yourself and become experienced. You’re able to do more, risk more, earn more. It’s a solid piece of advice and it fits in well with some of the rest.
He’s also franchising his brand to other partners which he absolves himself of and claims he doesn’t know what they’re actually doing with their scammy courses. Just don’t buy into any of that. I’ll tell you what’s actually valuable in the Rich Dad brand.
- Get the Rich Dad book. Just the one book, there are a dozen more, and I have no idea if they’re worth it. But the first one is.
- Play the Cashflow Classic game. It’s free to play online, you just register on his website. It will help you simulate a game of life, a game of Monopoly with Robert’s teachings. I urge you to read the book and play the game as you assimilate the concepts, try out different things, get in debt, lose everything, risk too much, risk too little. It’s a very good financial education tool, and because it’s a game, it’s easy to just play it it here and there instead of watching TV. It will help you understand capital gains, leverage, opportunities, bad investments, and most importantly, unlucky shit that gets thrown your way. ’Cause, like Picard says, it’s possible to make no mistakes and still lose. And that is life.
- Listen to the podcast Rich Dad Radio Show. There are some good guests there. It’s where I discovered Saifedean Ammous’ Bitcoin Standard. I mean, I’d probably stumble on the book at some point, but it goes to show you how good the guests are. This one is also full of upsells and partners of Rich Dad promoting their services, so just be sure to understand what you’re listening to.
- Watch some of his Videos on Youtube. I haven’t watched too many ’cause I can’t stand this stupid attitude of “Don’t pay taxes, educated people are dumb, I’m so rich and you can be too if you sign up for my course of just $500.” It’s emetic. He’s basically an Asian Trump. No, seriously, they’re mates and they even wrote a book together, I kid you not. They even look alike. But if you separate the salesman talk from the actual information, there are a lot of little nuggets of gold to be mined there.
The newsletter is full of upsells and ad copy. Right now it’s full of crypto, of course he’s not the one teaching you that, he just has a couple of partners who sell you courses. It’s hilarious, to be honest. The site has some solid info like the podcasts, just ignore all the upsells. The youtube channel again, has some solid guests. Just ignore all of the upsells.
That’s it. Just like in anything on the internet, ignore all of the upsells.
Even the ones on this site.
