Rich Dad Poor Dad | 3 Profitable Lessons For Business Owners and Creatives
Rich Dad, Poor Dad, is one of the most empowering books written about money, of all time, Today, I’d like to focus on three extremely profitable lessons from the book that all business owners and creatives can utilize to improve their life and finances. If you’d like to watch the video, click here.
My name is Lucas and welcome. If you’re not familiar with the book, the author, Robert Kiyosaki illustrates the financial habits of the wealthy and makes them incredibly easy to understand.
For the last 2.5 decades, I’ve used the book as an instruction manual on how to escape the rat race, build businesses and get money working for me. If you’re a business owner or a creative professional and you’ve always been financially challenged, stick with me as I break down 3 valuable lessons from the book Rich Dad Poor Dad.
Lesson 1: Understand How Taxes Work and Pay Less of them…
As Robert points out, wealthy people take the time to understand how taxes work and then legally pay less of them. It’s one of the key factors to building long term wealth and it’s available to you.
The government wants to grow the economy and so they offer tax incentives. Our small businesses contribute to that growth so when we have a proper business set up, we can take advantage of the incentives and pay less tax.
The 2nd benefit of being taxed as a business owner is how the money flows. Robert illustrates the concept like this…
Without a business entity: We earn money, get taxed first and then we can spend whatever’s left over.
With a business entity: We earn, we spend money first and pay taxes last.
When the government takes their cut first, we have to figure out how to survive on whatever’s left. We are reacting to our circumstances - what I often refer to as living in “survival” mode. But when we’re able to pay taxes last, everything shifts.
Instead of REACTING, we are now CREATING our circumstances and that’s a powerful place to be.
When we take the time to understand how taxes work, we open up a whole new world of opportunity for ourselves. And the icing on the cake is that we pay less taxes.
Lesson 2: It’s not how much money you make, but how much money you keep.
In Robert’s words, “It’s not how much money you make, but how much money you keep”. When I first read this at 17, I took it at face value and began saving as much money as I could.
However, a few years ago I started helping business owners improve there finances and that’s when Robert’s words took on a new meaning. You see, when clients first come to me, every one of them believes that they need more money to fix their finances, so they grind it out, overlooking the real problem…
They do not know how to keep the money they make. They don’t save, They have no accountability for their spending, they pay more taxes than they need to, they struggle with irregular income and debt. And they have no good way to manage their money
Take Thomas and Samantha for example.. In session 1 of the Big Split, I showed them how they had been leaking over 200k each year. They had no good way to manage their money, no accountability for their spending, they had no savings and they owed 90k.
I taught them how to plug the leaks and keep all of their money. Then I showed them how to start paying themselves first. Within 12 months, they paid off their debt, saved 110k, quit their jobs and started their own business.
And that's while they were being taxed as employees - I can’t wait to see how much money they'll save as a Business owners. And that’s brings us to Lesson 3…
Lesson 3: Pay Yourself 1st
Out of all of all the lessons within Rich Dad Poor Dad, paying yourself first may be the most underrated. It’s also, THE MOST IMMEDIATE & EFFECTIVE way we can improve our finances.
Think about it.. Currently, we receive a check and then immediately give that money to banks, insurances companies and the government. We’ve trained ourselves to give our money to everyone else first, meanwhile our financial goals get neglected.
But when we pay ourselves and our priorities first, our accounts grow rather quickly. If you’d like to learn how, check out my full tutorial here..
Now let’s recap..
Lesson 1: Understand how taxes work and pay less of them.
Lesson 2: Learn how to keep more of your money
Lesson 3: Pay yourself first.
I’ve incorporated these 3 lessons plus so many others into the Big Split program. It’s kind of like a financial boot camp so if you’d like to get in great financial shape in less than a week, click here to learn more and when you’re ready, book a free 1 on 1 session with me.
If you’d like to learn more about Robert or Rich Dad Poor Dad, check out his youtube channel. I hope you enjoyed today’s lesson. Thank you for your time and energy!
Thank you for your time and energy. I’ll see you in the next one.
Lucas Z.