The rich buy assets. The poor only have expenses. The middle class buys liabilities they think are assets.

The key to financial freedom and great wealth is a person’s ability to convert earned income into passive income.

It’s not how much money you make. It’s how much money you keep, how hard it works for you, and how many generations you keep it for.

Money without financial intelligence is money soon gone.

The real path to wealth is building assets, not increasing labor income:
<ul>
<li>Assets put money in your pocket (e.g., real estate, stocks, businesses)</li>
<li>Liabilities take money out (e.g., mortgages, car loans, bad debt)</li>
<li>Wealthy people focus on acquiring assets early and consistently</li>
<li>Income alone doesn't equal wealth if it's all spent on liabilities</li>
</ul>

Assets make you rich

Wealth starts with how you think, not what you earn:
<ul>
<li>Scarcity says “I can’t”; abundance says “how can I?”</li>
<li>Problem-solvers create value and wealth</li>
<li>Beliefs about money often become self-fulfilling</li>
<li>A growth mindset fuels entrepreneurial thinking</li>
</ul>

Mind your money mindset

Trading time for money caps your potential:<ul><li>Time is limited, but smart investments grow on their own</li><li>Building passive income creates freedom</li><li>Businesses, real estate, and investments scale better than wages</li><li>Focus on creating systems that generate cash without your labor</li></ul>

Don’t trade time for money

Understanding financial rules is a superpower:
<ul>
<li>Formal education rarely teaches money mastery</li>
<li>Knowing tax strategies, legal structures, and investment vehicles gives an edge</li>
<li>Smart money avoids taxes, uses debt to build wealth, and creates protective structures</li>
<li>You win by playing a smarter game, not working harder</li>
</ul>

Learn the rules of money

Although we have been successful in our careers, they have not turned out quite as we expected. We both have changed positions several times-for all the right reasons-but there are no pension plans vesting on our behalf. Our retirement funds are growing only through our individual contributions. Michael and I have a wonderful marriage with three great children. As I write this, two are in college and one is just beginning high school. We have spent a fortune making sure our children have received the best education available. One day in 1996, one of my children came home disillusioned with school. He was bored and tired of studying. “Why should I put time into studying subjects I will never use in real life?” he protested. Without thinking, I responded, “Because if you don't get good grades, you won't get into college.” “Regardless of whether I go to college,” he replied, “I'm going to be rich.”

Kiyosaki is best known for his book Rich Dad, Poor Dad, the #1 New York Times bestseller. Kiyosaki followed with Rich Dad's CASHFLOW Quadrant and Rich Dad's Guide to Investing.

ROBERT T. KIYOSAKI

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