Robert Kiyosaki’s Rich Dad, Poor Dad isn’t just about money, it’s about life. His dad, an educated PhD, a successful and respected academic official, spent most of his life struggling to find time and to get by financially. He was successful, but there was never enough time and never enough money. His friend’s dad never finished high school, but managed to build a financial empire. When he was a little kid, he asked his dad how to get rich. When “making money” led him and his buddy to melting lead toothpaste tubes, both their fathers were happy with the initiative, but suggested he study from the future millionaire about how to get there. This book flipped my world view. Before I read it, I never thought about my path in life. I just figured I’ll get a good degree, get a decent job, become better at it, and try to enjoy my weekends and hours after work. This book reveals, in very powerful and simple terms, that the difference between rich and poor is that the rich let money work for them and the poor work for their money. It’s very eye opening stuff.
The story started almost half a year ago. Not far from when I started my web development internship. My dad set an anchor for learning Spanish and, right on time, a new guy joined his company–fluent speaker, with software in the language. He also let my dad listen to some tapes called “Rich Dad Poor Dad”
At the dinner table:
Dad: “Say you need some extra cash, what do most people do? What’s the most logical thing to do?”
B: “Get another job?”
D: “That’s what most people say. But it’s absolutely the wrong answer. To really make it, you shouldn’t work two jobs, you need to start your own business. A business can grow and make you more money, but working that second job, you’ll just be wasting your time. You won’t be getting any better at it, advancing, or getting well paid. It’s just not worth it.”
I liked this idea. Both my parents work two jobs. They make decent money, but end up stuck in the same situation, working to exhaustion and worrying about losing their jobs. Making almost nothing with the internship and learning even less, I started thinking about what to do. I realized this job was leading nowhere and perhaps school wouldn’t be so bad. I needed to study for the GRE’s or the GMAT. Since I’ll be studying, why not start a business as I do it. Tutor kids in SAT’s and practice my own stuff at the same time. It would pay just as much for like a half or third the time I spend at work, and it’d be time well spent.
For about a week I searched for a desk on craigslist. Coming home tired, I’d just look for an hour or so, then crash. One night I just had enough. I was just going to go buy a new one. It would be an investment, a place where my students would study. I ran out of the house to buy the perfect desk at Target, from the Metropolitan Collection. Sleak, simple, and comfy and tall. (Sorry for the tangent, I’m quite a fan of interior design.)
After one final check for responses to my desk inquiries, I was out the door. Right as it closed I remember the faceplace to my CD-player. I go back in and switch it with my keys and head out again. Again, I realize the keys are gone right as the door clicks locked. With my roomate out for the day and a spare car key in my wallet, the journey began.
I got the desk. Oh, so lovely. But now what? With no way to get into my place and nowhere nearby to go, why not hit up a book store? I drove the desk over to Borders and somehow ended up picking out that book. I finished a third by the time the store closed.
All my training, my programming, my getting programmed. It finally dawned on me. What am I going to do to make it? I couldn’t put down this book. It’s like picking up a manual on your life. Not just some VCR manual, but a fun one, written in real words, by real people, and about you. I just couldn’t stop.
After the store closes, I read another hour in my car, but realizing that it’ll get too cold to sleep there, I call up J, a buddy in the Mission. Just a few weeks back, my roomate and I stopped by J’s place for a chat. Back in the days, J and I would carpool to math classes at the local high school and were micro-community presidents, in high school we were both programming nerd and took classes at the JC with my dad. Toward college, we didn’t kick it as much, although I’d end up at a bunch of political rallies with his mom. He was a contractor for Y2K stuff and a waiter, while I worked at the library. He started college a semester before me, and by the time I started, he joined a frat. I joined some atheist group. Eventually realizing what a waste of time it was, I evolved to a dance group. By this time he took on a job at the Computer Center. He ran the house budget and then ran the house, while I took summer school. He eventually chose Cog Sci, and I followed in his tracks. By the time I followed him to becoming an advisor, he went to study business in Spain. While I grunted through my last year, he took a trip to Peru to teach and raise funds for an orphanage in Peru. By the time I was done with Cal, he’d joined an internet company and worked his butt off. He had a powerful work ethic and a very strong personal and leadership skills and I had only respect for him. And tonight, he saved me from the cold (the desk could take it).
That night, as he and the girl he met on match.com had some fun in his room, I kept reading the book. Around three, a few friends came back from the bars and crashed in the living room too. I took a nap and went into the bathroom to keep reading. Around six, his roommates came back from the clubs. This whole time I was reading. I couldn’t stop until I finished. I finished around six in the morning. I can’t describe what’s in the book. The first few chapters take all the things you learn in school and flip them on their head. It’s just amazing.
Reading this book was one of the biggest turning points in my life. It shook me up and made me realize that I need really sit down and really think about how I want to live my life. While this book isn’t a clear formula, it’s a big wake-up call and should be mandatory reading for people going into high school. I wish I read it then.
Joel Greenblatt’s The Little Book That Beats the Market is an impressively straightforward and action-oriented investing book. It’s also a pleasure to read. It’s based on Benjamin Graham’s principles but it gets the point across in less than two hundred pages and uses simple examples that a middle school kid could understand. The author also has a track record to prove his theories (he’s founder and managing partner of Gotham Capital, a fund with quite a record).