I'm the first to admit that I've been critical of Robert Kiyosaki at times. But, regardless of some of his business behavior, Kiyosaki has still given us some great investing advice.
Today I wanted to take the time to share with you three pieces of advice that Robert Kiyosaki has recently shared, and highlight why you should heed it.
These pieces of advice have stirred a wide variety of thoughts from people around the globe. Given that Robert Kiyosaki has encouraged many, but still infuriated a few, this isn't a huge surprise. Regardless, let's get to the best investing advice from Robert Kiyosaki and see how it measures up.
Robert Kiyosaki on Getting Started Investing
I'm often asked how to start investing with little or no money. Please hear this as this is the hardest thing for people to understand: you do NOT invest with money! You invest with your mind! No matter what the field, your biggest asset is your mind. Once you have knowledge, you find deals, find your team and use other people’s money. You sell the deal and your team to get investment money.
Robert Kiyosaki shared this advice about four months ago, and it has since been shared 1,000s of times on social media. I find this advice to be extremely similar to what we talk about regularly here on The College Investor: investing in yourself. The sentiment of many of the commenters on social media about this had the similar mindset. However, many were still skeptical — saying things like “easier said than done.”
I think for many, the knowledge is out there, but you have to go find it. Once you do, you can start to understand the principles of investing very easily.
Robert Kiyosaki on Investing Risk
Investing is less risky than being an employee. Skilled investors are in control of their investments; employees are controlled by a boss.
I find this quote to be extremely interesting, because it takes a much different view on investing than people are accustomed to. On the surface, many people look at this as talking about career paths. In fact, I would guess that about 50% of the comments on social media about this quote have to do with career advice. However, I believe that Robert Kiyosaki was going in a different direction, and simply using a metaphor.
He's talking about ownership here — not about the workplace. He says being an owner is less risky than an employee because of the say they have in the direction of the company. Just think: last week we were talking about preparing your portfolio for losing your job, because so many people are struggling to keep their jobs in the workplace.
Compare being an employee with being an investor this year. Employees are worried about their jobs, about cuts to their benefits, and a myriad of other issues. On the other hand, owners (including shareholders) have enjoyed a booming stock market that has increased their wealth tremendously. That's the value of investing, and of being an owner.
Work at a nine-to-five job — but realize that you should be building ownership in something, and not just relying on your company to take care of you.
Robert Kiyosaki on Planning
Investing is a plan, not a product or a procedure.
Finally, my favorite, is this one. Investing is a plan — there is not a “buy this” option to create the perfect portfolio that will guarantee you millions. You just have to create a solid plan, and then work that plan over time. Like we discussed in The Only Thing That Matters In Investing, you just need to build a solid plan:
- Step 1: Understand your risk, reward, and time horizon.
- Step 2: Create an asset allocation that matched your goals (i.e. make the plan).
- Step 3: Rebalance your portfolio to match your changing goals (i.e. work the plan).
Too many people want a simple, “here you go” solution. It just doesn't work that way — everyone is different, and the plan needs to be individualized.
Your Turn
What do you think about Robert Kiyosaki's investing advice? Can you judge his advice separate from his background story? Do you find some of his quotes and advice meaningful regardless? I'd love to know your thoughts, as well as any other quotes from Robert Kiyosaki you enjoy.
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I have been a great fan of Kiyosaki’s advice since reading Rich Dad, Poor Dad and despite some of his business practices, I still believe his investment advice is solid. I thinking investing in oneself is definitely one of the pieces of advice I like from him…when you gauge it, money and assets come and go, the market may crash or something, but if you have the know-how, more often than not you can rebuild.
Rich Dad Poor Dad, is one of the first books I read on personal finance. I like the advice and to me it makes sense what he is saying, because I understand the concepts he is trying to convey.
Regardless of his business practices, Robert Kiyosaki’s advice is what got me into personal finance and is the reason I have ANY investments. I’m grateful, especially during times like this when I’m unemployed; my net worth is still rising thanks to my investments.
I’ve read many finance and investing books. Few of them come close to Robert Kiyosaki in reshaping your thinking. His perspective is so different that it takes time to really absorb his message. I regularly re-read his books, despite their repetitive message, just to refresh my mindset and make sure I’m focusing on the most important things.
The primary complaint I have about his writing is that it’s so generic – here’s what to do, but no here’s how to do it.
That’s an interesting perspective that I never thought about. Hopefully you find more about “how to do it” here!
Kiyosaki made investing in real estate and buying assets more understandable and his books are very popular. Investing in real estate is much complicated than it appears. Owning rental property requires a lot of work too. Most people are not ready for either.
Totally agree – I think that being a landlord is the equivalent of having a job (or second job). It may be smooth sailing for a time, but it requires a lot of work at other times.
Great advice, and I really need to pick up the book! I wasn’t a fan, because he’s like the antonym of Dave Ramsey, but since I’ve matured a bit, I’m intrigued by his style. No $30k seminars for me, but I’d love to get inside his mind 🙂
His book Rich Dad Poor Dad woke me up from my early 20’s day dream of living in a fantasy world of not needing to be financially responsible. I didn’t agree with all of his advice but he got me on track.