Robert Toru Kiyosaki (born April 8, 1947) is an American investor, businessman, self-help author, motivational speaker, financial literacy activist, and occasional financial commentator. Kiyosaki is perhaps best known for his Rich Dad Poor Dad series of motivational books and other material published under the Rich Dad brand. He has written over 15 books which have combined sales of over 26 million copies. Although beginning as a self-publisher, he was subsequently published by Warner Books, a division of Hachette Book Group USA. His new books appear under the Rich Dad Press imprint. Three of his books, Rich Dad Poor Dad, Rich Dad's CASHFLOW Quadrant, and Rich Dad's Guide to Investing, have been on number one on the top 10 best-seller lists simultaneously on The Wall Street Journal, USA Today and the New York Times. Rich Kid Smart Kid was published in 2001, with the intent to help parents teach their children financial concepts. He has created three "Cashflow" board and software games for adults and children and has a series of "Rich Dad" CDs and disks.
As a devout global financial literacy advocate, Kiyosaki has been a staunch proponent of entrepreneurship, business education, investing, and that comprehensive financial literacy concepts should be taught in schools around the world. Kiyosaki also operates his own blog and maintains a monthly column on Yahoo Finance writing about his latest thoughts on global economics, investing, business, world financial markets, and personal finance.
Life and career
A fourth-generation Japanese American, Kiyosaki was born and raised in Hilo, Hawaii. He is the son of educator Ralph H. Kiyosaki (1919–1991). After graduating from Hilo High School, he attended the U.S. Merchant Marine Academy in New York, graduating with the class of 1969 as a deck officer. He later served in the Marine Corps as a helicopter gunship pilot during the Vietnam War in 1972, where he was awarded the Air Medal.
Kiyosaki left the Marine Corps in 1975 and got a job selling copy machines for the Xerox Corporation as a salesperson. In 1977, Kiyosaki started a company that brought to market the first nylon and Velcro "surfer" wallets. The company was moderately successful at first but eventually went bankrupt. In the early 1980s, Kiyosaki started a business that licensed T-shirts for Heavy metal rock bands, which was later sold in 1985. In his book You can Choose to be Rich, Kiyosaki said that after his bankruptcy he became homeless, and was living with his then girlfriend Kim at the back of an old Toyota for several months before starting their own business from the ground up.
In 1994, after becoming financially independent through various real estate investments and private business operations, Kiyosaki retired at the age of 47. In 1997, after his short lived retirement, he launched Cashflow Technologies, Inc. which owns and operates the Rich Dad and Cashflow brands.
Personal life
He has been married to wife, Kim, who is an entrepreneur, investor, author, and a motivational speaker. They have been married since 1985. He and Kim have settled in the Scottsdale area in Phoenix, Arizona since 1994. Kiyosaki also has one brother and two sisters. One of his sisters, Emi Kiyosaki, a Tibetan Buddhist nun known by the name Ven. Tenzin Kacho. He has co-authored one book with her called "Rich Brother, Rich Sister".
Business ventures and investments
Aside from operating the Rich Dad Company and Cashflow Technologies, Inc., Kiyosaki continues to operate external business ventures and has continued engaging with various investments since he came out of retirement in 1997.
Mining ventures
Kiyosaki bought a silver mine in South America in 2002, took a gold mining company in China public back in 2002, and took public additional mines from IPOs listed on the Toronto Stock Exchange during the early 2000s. In 2009, Kiyosaki revealed in his book Conspiracy of the Rich that he is currently working on a copper mine that is yet to be taken public once copper prices begin to rise in value.Precious metals and coin dealing
Through his teenage years, Kiyosaki dabbled with silver and gold coins as a starting investment during the 1960s. In a July 2005 Yahoo Finance article Kiyosaki states thatIf you only have a few dollars, you may want to go to your local coin dealer and buy silver and gold coins as close to the price of gold or silver as possible. I would not invest in 'collectible' precious metal coins unless you really know a good collectible coin from a bad one. For as little as $20 you can buy a few precious metal coins and begin to take steps to prepare for one of the biggest crashes in world history.
In addition, Kiyosaki states that he is a "gold bug", meaning is that he holds various commodities such as gold and silver to hedge against government misprinting of the U.S. dollar as a fiat currency since the early 1970s when President Richard Nixon took the dollar off the gold standard.
Real estate acquisitions
Kiyosaki is also an active real estate investor. A large portion of his wealth is concentrated within real estate investing. He has various real estate investments, real estate development ventures, and property management ventures operating around the United States, such as Texas and Oklahoma, particularly in his home state of Arizona, where he lives. Many of his holdings include hotels, golf courses, and large apartment complexes as stated in an interview with The Alex Jones Show back in late 2010.Starting with small residential real estate investments back in 1973, Kiyosaki began investing in small condos on the island of Maui, making a small profit from capital gains by the mid 1970's. Kiyosaki starting his own real estate holding company in the 1980s during his tenure with Xerox and continued on with smaller real estate investments after the Savings and loan crisis and the 1986 Tax Reform Act hit the United States in the early 1990s where much foreclosure investment real estate was sold for pennies on the dollar. After progressing with smaller real estate investments, Kiyosaki moved into the commercial real estate business, branching off into semi-large apartment complexes, with a large portion concentrated in Arizona and the Southwestern United States and retired in 1994. Since coming out of retirement in 1997, Kiyosaki still remains involved with the apartment business and stated in an interview with Jason Hartman in 2011 that he owns over 1400 units of apartment houses.
Kiyosaki has been involved with commercial real estate sector such as investing in warehouses, Triple net lease and real estate development ventures around the United States.
Oil wells and natural gas investments
Kiyosaki has stated in a Rich Dad video, several interviews, and a on number of Yahoo Finance articles that he owns oil drilling operations and oil wells around the United States but does not invest in oil company shares such as ExxonMobil or BP.Solar company
In a 2010 Rich Dad Insiders video, Kiyosaki stated that he also invested in a startup solar company.Financial market investments
Written in a chapter of Rich Dad's Prophecy, Kiyosaki states of having invested in various government tax free bonds such as municipal bonds and municipal mortgage REIT's offered by real estate development companies paying over 12% tax free dividend interest.
Kiyosaki has also stated in numerous interviews that he does not invest or play the stock market much like the fact that he does not invest in oil company stocks. Instead, Kiyosaki trades stock options, Forex currencies, and other derivatives in the financial markets as stated in a chapter written in his book, Rich Dad's Prophecy and in a 2009 interview with real estate investor John Hartman.
Kiyosaki has frequently mentioned himself of investing in hedge funds, private placements, and other various funds such as private equity funds typically investments reserved by SEC law only for millionaires or high-income individuals.
Kiyosaki is also involved in the commodity market where he invests in gold and silver commodities as well as gold and silver ETF's, as written in chapter of his 2008 book, "Rich Dads, Increase Your Financial IQ". He stated this for the reason that he uses commodities as a hedge against uncertain economic forces such as inflation and hyperinflation as well as government's mismanagement via printing of the nations currency.
Teachings
Main article: Rich Dad
A large part of Kiyosaki's teachings focus on what he calls "financial education" generating passive income by means of investment opportunities, such as real estate investments and businesses, with the ultimate goal of being able to support oneself by such investments alone and thus achieving true financial independence WITHOUT working for a paycheck. In tandem with this, Kiyosaki defines the term "assets" as things that generate cash inflow, such as stock dividends, rental properties, or businesses, and the term "liabilities" as things that use cash, such as houses, cars, and so on. Kiyosaki continuously argues that financial leverage is critically important in becoming rich, despite the inherent financial risks, repercussions, and pitfalls that come with it.
Kiyosaki uses the "rich dad, poor dad" comparison to illustrate his view that the majority of people are stuck in what he refers to as "the rat race"—living paycheck to paycheck and spending all of their time working to pay bills and other expenses. In his books, Kiyosaki advocates tax-advantaged investment vehicles, such as real estate or businesses, rather than ownership of securities such as stocks. This idea is further developed in his later books and "Rich Dad" became Kiyosaki's personal brand for various publishing ventures.
Kiyosaki continuously stresses financial literacy through the acquisition of he calls "assets" as the means to obtaining wealth. He says that life skills are often best learned through experience and that there are important lessons not taught in school. He says that formal education is primarily for those seeking to be employees or self-employed individuals, and that this is an "Industrial Age idea." And according to Kiyosaki, in order to obtain financial freedom, one must be either a business owner, an investor, or both generating passive income, particularly on a monthly basis.
Kiyosaki often refers to The CASHFLOW Quadrant, a conceptual tool which he developed to categorize the four major ways income is earned. Depicted in a diagram, this concept entails four groupings, split with two crossed lines (one vertical and one horizontal). In each of the four groups there is a letter representing a way in which an individual may earn income. The letters are as follows.
E: Employee — Working for someone else.
S: Self-employed or Small business owner — Where a person owns his own job and is his own boss.
B: Business owner — A person who owns a business to make money; typically where the owner's physical presence is not required.
I: Investor — Investing money in order to receive a larger income in the future.
For those on the left side of the divide (E and S), Kiyosaki says that they may never obtain true wealth. Conversely, those on the right side of the divide (B and I) are supposedly following the only road to true wealth.Kiyosaki also classifies the four main "asset" classes as means of gaining wealth.
:
Businesses: Businesses that generate monthly cash flow that don't require the owners physical presence.
Real Estate: Real estate such as owning warehouses, small family homes, or apartment houses that generate monthly cash flow.
Paper Assets: Investments such as stocks, bonds, hedge funds etc.
Commodities: Gold, silver, iron ore, or copper that are used to hedge government's mismanagement printing of the nations currency.
Games
Kiyosaki also stresses the value of games, particularly Monopoly, as tools for learning basic financial strategies such as "trade four green houses for one red hotel." Kiyosaki has created several games such as Cashflow 101 and Cashflow 202 to reinforce the information in his book.
Media appearances
Several local stations of the Public Broadcasting Service (PBS), including WTTW of Chicago, KAET of Phoenix, KOCE of Orange County, California, WLIW of the New York/New Jersey area, and WGBH of Boston, have featured Kiyosaki with his now cancelled Rich Dad TV series. His latest TV special was a fund-raising drive. During this television special, Rich Dad's Guide to Wealth with Robert Kiyosaki, he provides viewers with financial education, opposing the common notion of getting a college degree and downplaying the importance of attaining academic or professional education.Kiyosaki has been seen giving financial advice on various network television news channels such as on CNBC, Fox Business, and Bloomberg. He has appeared on various programs such as The Oprah Winfrey Show, Fox and Friends, Larry King Live, The O'reilly Factor, The Alex Jones Show, Glenn Beck, and Your World with Neil Cavuto.
In 2002, a speech given by Kiyosaki became the subject of a CNN story.
In 2006, Kiyosaki appeared on CNBC, discussing financial issues, answering questions from the audience, and comments by the financial experts were also invited. In particular, Kiyosaki also filled in a few episodes under the title The Millionaire Inside Debt-Free and The Millionaire Inside: Get Inspired. Other financial experts accompanied Kiyosaki, including David Bach, Jennifer Openshaw, Larry Winget, Keith Ferrazi, and Dr. Laura Morgan Roberts have also been invited to the event
In 2009, Kiyosaki was featured in a 10 Questions session in Time Magazine.
Over a number of years, Kiyosaki has repeatedly criticized other financial gurus, particularly the financial teachings of Suze Orman and Jean Chatzky, calling it “bad advice”. Because of this, Orman responded to Kiyosaki's attacks via Twitter and the two engaged in a Twitter war back in March 2010.
In September 2011, Kiyosaki along with wife Kim were featured on the front cover of JETSET magazine.
Financial advice
Mutual fundsFurther information: Mutual fund
Kiyosaki wrote in one column that investors in any mutual fund with a 2.5% annual fee would, over a long time period, surrender 80% of the earnings to the fund.Kiyosaki expanded on his criticism of mutual funds in another column by stating they are for "losers."Despite the fact that most mutual funds actually charged less than 1.1%. He has drawn much criticism for comparing investing in mutual funds to playing the lottery, and for discouraging 401(k) investing, contrary to the advice of most professional financial advisers.[43] In contrast to these statements, Kiyosaki wrote in his book Prophecy that while mutual funds are not great investments, they remain one of the few acceptable investment vehicles available to those who will not educate themselves financially.
Kiyosaki's criticisms are supported by the founder of the mutual fund Vanguard, John C. Bogle. In a Frontline episode titled "401(k)s: The New Retirement Plan, For Better or Worse", Bogle stated that management fees and trading costs gobble up approximately 2.5% of an investor's annual returns and approximately 80% of an investor's long term gains. He says management costs reduce the value of a $1,000 investment over 65 years from approximately $140,000 at 8% compounded annually to a mere $30,000 at 5.5% compounded annually. Bogle's solution is to utilize index funds, which charge as little as 0.09%, to substantially reduce or eliminate management fees.
Criticism and controversy
Kiyosaki's books and teachings have been criticized for focusing on anecdotes and containing little in the way of concrete advice on how readers should proceed.[45] Kiyosaki responds that his material is meant to be more of a motivational tool to get readers thinking about money rather than a step-by-step guide to wealth. He also says the books are supposed to be "interesting" to people, which precludes involving a lot of technical material.The Canadian Broadcasting Corporation consumer affairs program Marketplace ran an investigative piece on Kiyosaki's questionable business practices on Jan 29, 2010. It includes interviews with Kiyosaki.
Bibliography
Kiyosaki is best known for his book Rich Dad, Poor Dad. Kiyosaki followed with Rich Dad's CASHFLOW Quadrant and Rich Dad's Guide to Investing. He has now had at least a dozen books published, including:
- If You Want to Be Rich & Happy: Don't Go to School? : Ensuring Lifetime Security for Yourself and Your Children (1992). ISBN 0-944031-38-2.
- Rich Dad Poor Dad - What the Rich Teach Their Kids About Money - That the Poor and Middle Class Do Not! (first published in 1997) Warner Business Books. ISBN 0-446-67745-0.
- CASHFLOW Quadrant: Rich Dad's Guide to Financial Freedom (2000). ISBN 0-446-67747-7.
- Rich Dad's Guide to Investing: What the Rich Invest in, That the Poor and the Middle Class Do Not! (2000). ISBN 0-446-67746-9.
- The Business School for People Who Like Helping People (March, 2001). ISBN 99922-67-42-9 - endorses multi-level marketing
- Rich Dad's Rich Kid, Smart Kid: Giving Your Children a Financial Headstart (2001). ISBN 0-446-67748-5.
- Rich Dad's Retire Young, Retire Rich (2002). ISBN 0-446-67843-0.
- Rich Dad's Prophecy: Why the Biggest Stock Market Crash in History Is Still Coming… and How You Can Prepare Yourself and Profit from It! (2002). Warner Books, Incorporated. ISBN 0-641-62241-4.
- Rich Dad's The Business School: For People Who Like Helping People (2003) ISBN 979-686-729-X.
- Rich Dad’s Success Stories (2003)
- You Can Choose to be Rich (2003) 12-CD Audio series with three books.
- Rich Dad's Who Took My Money?: Why Slow Investors Lose and Fast Money Wins! (2004)ISBN 0-446-69182-8.
- Rich Dad, Poor Dad for Teens: The Secrets About Money—That You Don't Learn in School! (2004) ISBN 0-446-69321-9.
- Rich Dad's Before You Quit Your Job : 10 Real-Life Lessons Every Entrepreneur Should Know About Building a Multimillion-Dollar Business (2005). ISBN 0-446-69637-4.
- Rich Dad's Escape from the Rat Race - Comic for children (2005)
- Why We Want You to Be Rich: Two Men, One Message (2006) co-written with Donald J. Trump ISBN 1-933914-02-5.
- Rich Dad's Increase Your Financial IQ: Get Smarter with Your Money (2008). ISBN 0-446-50936-1.
- Rich Dad's Conspiracy of the Rich: The 8 New Rules of Money (2009). ISBN 0-446-55980-6
- Rich Dad's Rich Brother Rich Sister (2009) co-written with Emi Kiyosaki
- The Real Book of Real Estate: Real Experts. Real Stories. Real Life. (2010). ISBN 1-4587-7250-0.
- An Unfair Advantage: The Power of Financial Education (2011). ISBN 1-61268-010-0.
- Midas Touch: Why Some Entrepreneurs Get Rich And Why Most Don't (2011), co-written with Donald J. Trump ISBN 1-61268-095-X.
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