1. Rich Dad, Poor Dad
“Study hard, get good grades and find a high paying job with good benefits” is advice from a previous era.

2. The Rich Don’t Work for Money
Avoiding the trap
fear and greed
The rat race - work to spend and spend to have
a job is a short term solution to a long term problem
The poor and middle class believe that money is real and that the company or government will look after them.

3. Why Teach Financial Literacy?
You must know the difference between an asset and a liability and buy assets.
The rich buy assets but the poor and middle class buy liabilities they think are assets.
The cash flow pattern of an asset is from Assets to Income. (pg 60)
The cash flow pattern of a liability is from Liabilities to Expense.

4. Why Teach Financial Literacy?
The financial nightmare
hard working educated couple marries and begins their careers.
decide to save for dream home, and so work hard to make more money – taxes go way up.
They buy their new house and furnish it, and now have property taxes, mortgage and credit card debt.
Kids come along who cost money and so the parents work harder and up go the taxes.

5. Why Teach Financial Literacy?
As an employee who is a homeowner:
you work for someone else and are making the owner(s) or shareholders rich.
you work for the government, from Jan to May to pay your taxes
You work for the bank, paying off your mortgage, student loans and credit cards.

6. Why Teach Financial Literacy?
Remember this simple observation:
The rich buy assets
The poor only have expenses
The middle class buys liabilities they think are assets

7. Mind Your Own Business What are assets?
Business that do not require your presence to run and make money
Stocks
Bonds
Mutual Funds
Income generating real estate
Royalties from intellectual property
anything else that has value and produces income

8. Mind Your Own Business The cashflow quadrant Employee Business Owner
Self Employed
Investor

9. The History of Taxes and the Power of the Corporations
Is Robin Hood a hero or a villain?
How about “the rich should pay more in taxes and give it to the poor?”
The reality is that the rich are not taxed, it’s the middle class which pays for the poor.

10. The History of Taxes and the Power of the Corporations
What is a corporation?
It is a legal entity which limits the risk of its owners to the value it contains.
It can take as expenses things that individuals cannot.
It is what the rich use to hid their money from the taxman.

11. The History of Taxes and the Power of the Corporations
Financial IQ
Accounting – financial literacy. You need to be able to read and understand financial statements.
Investing – the science of money making money.
Understanding Markets – the science of supply and demand.
Law – The corporation, LLCs, and other legal instruments

12. The History of Taxes and the Power of the Corporations
The rich with corporations:
Earn
Spend
Pay Taxes
People who work for the corporation:
Earn
Pay Taxes
Spend

13. The Rich Invent Money The need of “guts.”
How creative can you be at coming up with financial solutions?
Most people only know one way: work hard, save and borrow.

14. The Rich Invent Money Which sounds harder to you?
Work hard, pay 50% in taxes, save what is left after the bills are paid. Your savings earns 5% which is also taxed
Take time to develop your financial intelligence and harness the power of your brain and the asset column.

15. The Rich Invent Money You need to develop the following skills
How to find an opportunity that everyone else has missed.
How to raise money. Most people go to the bank, but there are much better ways.
How to organize smart people. Accountants, lawyers, brokers, etc. are people who can work with and for you.

16. Work to Learn – Don’t Work for Money
There are skills that you should develop so that you will be better at business
communication
marketing
sales
leadership
financial understanding

17. Work to Learn – Don’t Work for Money
Don’t specialize to much
An expert is someone who knows more and more about less and less till he knows everything about nothing.
The more you specialize, the less options you will have.
A broad understanding of economics, history, politics and business will only help you make money.

18. So why not?
There are five reasons that people don’t grow assets and become financially independent.
Fear – of losing money
Cynicism – don’t let doubts paralyze
Laziness – busy people are often the most lazy
Bad Habits – our lives reflect our habits
Arrogance – arrogance + ego = ignorance