#189: Analyzing the gurus: Robert Kiyosaki
We continue our series about analyzing the gurus! We’ll be spending time discussing several big personal finance names, their recommendations, and why we do or do not agree with those. Josh and Amelie discuss Robert Kiyosaki, his philosophy of creating assets to generate money, leverage debt to create these assets, and his beliefs about formal education and savings.
Top takeaways:
- With any financial celebrity, watch out for business ecosystems designed to get more money from you.
- Choosing not to work for a company (aka “the man”) may limit loan funding options and will impact the terms of a loan, ultimately impacting your ability to get low cost debt.
- There is nearly always some of your time required for passive income sources (e.g., real estate), even if you’re paying someone else to manage it.
- The more passive an investment is, the less income you’re likely getting from it.
- A primary residence is a non-performing asset, which builds your wealth but not as fast as a rental property.
- Putting a property into an LLC doesn’t eliminate all the risk with owning that asset.
- The biggest risk with owning rental real estate is likely created when you borrow money to purchase the property.
- Oversimplification of the complexities and risk associated with real estate investments, coupled with overstating the potential return, often come from the “experts” who are trying to sell their own educational products.
- There is a lot of value in formal education.
- A real estate education from a community college includes valuable information that will help learn how to invest in real estate.
- Having a large savings account allows you to step further out on the risk spectrum.
- Institutions (e.g., banks, investment companies) are watched and controlled by regulators (e.g., SEC, state regulators) to protect the investors. Buying a house doesn’t have these same rigorous regulations.
