What the rich teach their children about money that the poor and the middle class don't.

    

     According to a financial literacy book written by Robert Kiyosaki,named ,"Rich Dad Poor Dad",it came to dawn on us that the rich have mastered certain principles about money and the need to develop your financial intelligence for one to gain a competitive adavantage against money.They have learned how money works and theirfore they use money to make more money unlike the majority who works for money.

  According to Robert Kiyosaki,having two Dadss ,the rich and a poor dad made him to contrast their points of views they were trying to pass across instead of rellying on only one dad for financial advice.Both dad's had different views about what they think about money,one would recommend that he go to school ,study hard and get good grades so that he can land a well paying job,while the other recommended that he go to school,get good grades so that  he can start his own company.For him,having two dad's made him one of the richest men ever.By the age of 9years,he choose to follow tha rich dad advice though it was a tough decision he could have ever made because,poor dad was a phd holder,he had completed an undergraduate course in just 2years than the rich dad who was a school dropout but he was well build in financial intelligence or financial IQ,a subject that is not taught in school yet.Schools only focus on teaching scholastic skills,to prepare you to work for money,so that the subject of money is always left to the rich who have mastered the principles about money.

  However,we are so much preoccupied with the common ways of the society,that we fail to understand the need to understand financial literacy and later fall into a trap,known as the rat race,the idea of ,go to work,earn,pay depts,-go to work,earn,pay depts and the circle is repeated over and over again.According to the principles highlighted in his book,for you to understand the game of the rich,you need to :

           1)Understand Accounting-Accounting is the ability to read numbers,though accounting don't seems to bring many into attention,it is what the rich have used to enable them to always remain rich and make more money while the poor and the middle class are meandering around wondering how these imdividuals are gaining so much wealth on monthly or yearly basis.Their asset column is always increasing day by day.According to Robert ,Wealth is defined as the period of time you will be able to survive incase you quit your day job".The rich have mastered the principle of investing more money into their asset column till they reach a situation where the amount of money from their asset column is able to cover their monthly expenses,that is the true definition of wealth.It means that even if you quit your day job,the amount of money flowing from the assets column is able to cover all your day to day spending.

      2)Understand markets-markets is always controlled by the law of supply and demand for example,you want to buy when the prices are low and sell when the prices are high.To demonstrate,Robert,would take advantage of huge market crashes where everyone is in panic,he could then buy real estate at a lower price and some stocks which are about to be made public,he reapeated tha  game over and over again.That's another secret of the rich that the poor and the middle class are not aware of,because the subject of money is not taught in school,it is taught at home,then what will their parents teach their kids about money if they are already poor,"that go to school,work hard and get good grades so that you can work for a good  company and get a good salary.On the other hand,guess what the rich would teach their kids about money?You got it right,,reply on the comments section...

      3)Understand investing-Investing is the science of making   money.The rich have mastered principle of using the creative right brain side to brainstorm about the ideas of making money.They have learned about the need to always put their ideas into aciton and as a result they continue to became rich.

   4)Understand the difference between an asset and a liability-,an asset is something that puts money in your pocket while a liability is something that takes money out of your pocket.State few examples of assets and liabities in the comments  section, that you now know after understanding the definition of assets and liabilities.Their is no rocket science here,the idea is simple,keep your day job and use your salary to accumulate more assets till the cashflow flowing from the assets column are in a position to cover your monthly expenses,that is the true definition of wealth.

    5)Understand taxes-You need to master the tax advantages behind every cooporation.A cooporation wrapped up with the technical skills of accounting,investing and a solid understanding of the markets can contribute to explosive growth than that of an employer or a sole proprietor.Cooporation is meant to protect the rich from those individuals who like the behavior of suing the rich.Cooporation protect the rich by a layers of legal acts only for these individuals to later be suprised that the rich actually owns nothing,they have learned to utilise the tax advantages behind every cooporation.

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