--- ## Highlights “Life pushes all of us around. Some people give up and others fight. A few learn the lesson and move on. They welcome life pushing them around. To these few people, it means they need and want to learn something. They learn and move on. Most quit, and a few like you fight.” (Location 356) If you think I’m the problem, then you have to change me. If you realize that you’re the problem, then you can change yourself, learn something, and grow wiser. Most people want everyone else in the world to change but themselves. (Location 378) true learning takes energy, passion, and a burning desire. Anger is a big part of that formula, for passion is anger and love combined. (Location 403) “And how did you feel when Mrs. Martin dropped three dimes in your hand for three hours of work?” “I felt like it wasn’t enough. It seemed like nothing. I was disappointed,” I said. “And that is how most employees feel when they look at their paychecks—especially after all the tax and other deductions are taken out. At least you got 100 percent.” (Location 429) Lesson The Rich Don’t Work for Money (Location 462) “Good,” rich dad said softly. “Most people have a price. And they have a price because of human emotions named fear and greed. First, the fear of being without money motivates us to work hard, and then once we get that paycheck, greed or desire starts us thinking about all the wonderful things money can buy. The pattern is then set.” “What pattern?” I asked. “The pattern of get up, go to work, pay bills; get up, go to work, pay bills. People’s lives are forever controlled by two emotions: fear and greed. Offer them more money and they continue the cycle by increasing their spending. This is what I call the Rat Race.” (Location 499) “In fact, the reason many rich people are rich isn’t because of desire, but because of fear. They believe that money can eliminate the fear of being poor, so they amass tons of it, only to find the fear gets worse. (Location 530) They’re terrified of losing it all. The fears that drove them to get rich got worse. (Location 532) “I’ve met so many people who say, ‘Oh, I’m not interested in money.’ Yet they’ll work at a job for eight hours a day. (Location 541) The word ‘emotion’ stands for ‘energy in motion.’ Be truthful about your emotions and use your mind and emotions in your favor, not against yourself.” (Location 549) “So how do we avoid the trap?” I asked. “The main cause of poverty or financial struggle is fear and ignorance, not the economy or the government or the rich. It’s self-inflicted fear and ignorance that keep people trapped. (Location 573) it’s imperative for you to use those emotions to your advantage, and for the long term to not let your emotions control your thinking. Most people use fear and greed against themselves. (Location 581) Money is the carrot, the illusion. If the donkey could see the whole picture, it might rethink its choice to chase the carrot.” (Location 590) To wake up in the middle of the night terrified about paying bills is a horrible way to live. To live a life dictated by the size of a paycheck is not really living a life. Thinking that a job makes you secure is lying to yourself. That’s cruel, and that’s the trap I want you to avoid. I’ve seen how money runs people’s lives. Don’t let that happen to you. Please don’t let money run your life.” (Location 601) But schools focus only on teaching people to work for money, not how to harness money’s power.” (Location 615) “Yes,” said rich dad. “The briar patch is our fear and greed. Confronting fear, weaknesses, and neediness by choosing our own thoughts is the way out.” “Choosing our thoughts?” Mike asked, puzzled. “Yes. Choosing what we think rather than reacting to our emotions. (Location 628) The moment you see one opportunity, you’ll see them for the rest of your life. (Location 657) By not getting paid for our work at the store, we were forced to use our imaginations to identify an opportunity to make money. By starting our own business, the comic-book library, we were in control of our own finances, not dependent on an employer. (Location 682) it’s not how much money you make. It’s how much money you keep. (Location 712) Accounting is possibly the most confusing, boring subject in the world, but if you want to be rich long-term, it could be the most important subject. (Location 732) Rich people acquire assets. The poor and middle class acquire liabilities that they think are assets. (Location 740) Rule You must know the difference between an asset and a liability, and buy assets. If you want to be rich, this is all you need to know. (Location 742) This is the cash-flow pattern of a rich person: All of these diagrams are obviously oversimplified. Everyone has living expenses, the need for food, shelter, and clothing. The diagrams show the flow of cash through a poor, middle-class, and wealthy person’s life. It is the cash flow that tells the story of how a person handles their money. The reason I started with the story of the richest men in America is to illustrate the flaw in believing that money will solve all problems. That is why I cringe whenever I hear people ask me how to get rich quicker, or where they should start. I often hear, “I’m in debt, so I need to make more money.” But more money will often not solve the problem. In fact, it may compound the problem. Money often makes obvious our tragic human flaws, putting a spotlight on what we don’t know. That is why, all too often, a person who comes into a sudden windfall of cash—let’s say an inheritance, a pay raise, or lottery winnings—soon returns to the same financial mess, if not worse, than the mess they were in before. Money only accentuates the cash-flow pattern running in your head. If your pattern is to spend everything you get, most likely an increase in cash will just result in an increase in spending. Thus, the saying, “A fool and his money is one big party.” Cash flow tells the story of how a person handles money. I have said many times that we go to school to gain scholastic and professional skills, both of which are important. We learn to make money with our professional skills. In the 1960s when I was in high school, if someone did well academically, people assumed this bright student would go on to be a medical doctor because it was the profession with the promise of the greatest financial reward. Today, doctors face financial challenges I wouldn’t wish on my worst enemy: insurance companies taking control of the business, managed health care, government intervention, and malpractice suits. Today, kids want to be famous athletes, movie stars, rock stars, beauty queens, or CEOs because that is where the fame, money, and prestige are. That is the reason it is so hard to motivate kids in school today. They know that professional success is no longer solely linked to academic success, as it once was. Because students leave school without financial skills, millions of educated people pursue their profession successfully, but later find themselves struggling financially. They work harder but don’t get ahead. What is missing from their education is not how to make money, but how to manage money. It’s called financial aptitude—what you do with the money once you make it, how to keep people from taking it from you, how to keep it longer, and how to make that money work hard for you. Most people don’t understand why they struggle financially because they don’t understand cash flow. A person can be highly educated, professionally successful, and financially illiterate. These people often work harder than they need to because they learned how to work hard, but not how to have their money work hard for them. How the Quest for a Financial Dream Turns into a Financial Nightmare The classic story of hardworking people has a set pattern. Recently married, the happy, highly educated young couple moves into one of their cramped rented apartments. Immediately, they realize that they are saving money because two can live as cheaply as one. The problem is the apartment is cramped. They decide to save money to buy their dream home so they can have kids. They now have two incomes, and they begin to focus on their careers. Their incomes begin to increase. As their incomes go up, their expenses go up as well. The number-one expense for most people is taxes. (Location 793) Cash flow tells the story of how a person handles money. (Location 804) More money seldom solves someone’s money problems. Intelligence solves problems. (Location 842) It is said that the fear of public speaking is a fear greater than death for most people. According to psychiatrists, the fear of public speaking is caused by the fear of ostracism, the fear of standing out, the fear of criticism, the fear of ridicule, and the fear of being an outcast. The fear of being different prevents most people from seeking new ways to solve their problems. (Location 855) If my wife and I were to buy a bigger, flashier house, we realize it wouldn’t be an asset. It would be a liability since it would take money out of our pocket. (Location 893) - The greatest losses of all are those from missed opportunities. If all your money is tied up in your house, you may be forced to work harder because your money continues blowing out of the expense column, instead of adding to the asset column—the classic middle-class cash-flow pattern. (Location 903) the end result in making a decision to own a house that is too expensive in lieu of starting an investment portfolio impacts an individual in at least the following three ways: 1.   Loss of time, during which other assets could have grown in value. 2.   Loss of additional capital, which could have been invested instead of paying for high-maintenance expenses related directly to the home. 3.   Loss of education. Too often, people count their house and savings and retirement plans as all they have in their asset column. (Location 907) Why the Middle Class Struggle The middle class finds itself in a constant state of financial struggle. Their primary income is through their salary. (Location 925) concentrate your efforts on buying income-generating assets. That’s the best way to get started on a path to becoming rich. Keep doing that, and your asset column will grow. Keep liabilities and expenses down so more money is available to continue pouring into the asset column. Soon the asset base will be so deep that you can afford to look at more speculative investments: investments that may have returns of 100 percent to infinity; $5,000 investments that are soon turned into $1 million or more; investments that the middle class calls “too risky.” The investment is not risky for the financially literate. (Location 944) (Location 950) 1. You work for the company. Employees make their business owner or the shareholders rich, not themselves. Your efforts and success will help provide for the owner’s success and retirement. 2.   You work for the government. (Location 951) Wealth is a person’s ability to survive so many number of days forward—or, if I stopped working today, how long could I survive? (Location 966) Wealth is the measure of the cash flow from the asset column compared with the expense column. (Location 971) The rich focus on their asset columns while everyone else focuses on their income statements. (Location 989) That secret is: Mind your own business. Financial struggle is often directly the result of people working all their lives for someone else. Many people will simply have nothing at the end of their working days to show for their efforts. (Location 1008) These professional skills allow them to enter the workforce and work for money. But there is a big difference between your profession and your business. Often I ask people, “What is your business?” And they will say, “Oh, I’m a banker.” Then I ask them if they own the bank. And they usually respond, “No, I work there.” In that instance, they have confused their profession with their business. (Location 1012) Financial struggle is often the result of people working all their lives for someone (Location 1025) One of the main reasons net worth is not accurate is simply because, the moment you begin selling your assets, you are taxed for any gains. (Location 1039) real assets fall into the following categories: •   Businesses that do not require my presence I own them, but they are managed or run by other people. If I have to work there, it’s not a business. It becomes my job. •   Stocks •   Bonds •   Income-generating real estate •   Notes (IOUs) •   Royalties from intellectual property such as music, scripts, and patents •   Anything else that has value, produces income or appreciates, and has a ready market (Location 1054) I like starting companies, not running them. (Location 1065) Start minding your own business. Keep your daytime job, but start buying real assets, not liabilities. (Location 1071) When I say mind your own business, I mean to build and keep your asset column strong. Once a dollar goes into it, never let it come out. Think of it this way: Once a dollar goes into your asset column, it becomes your employee. The best thing about money is that it works 24 hours a day and can work for generations. Keep your day job, be a great hardworking employee, but keep building that asset column. (Location 1080) I remind people that financial IQ is made up of knowledge from four broad areas of expertise: 1.   Accounting Accounting is financial literacy or the ability to read numbers. This is a vital skill if you want to build an empire. The more money you are responsible for, the more accuracy is required, or the house comes tumbling down. (Location 1225) 3. Understanding markets Understanding markets is the science of supply and demand. You need to know the technical aspects of the market, which are emotion-driven, in addition to the fundamental or economic aspects of an investment. (Location 1233) 4. The law A corporation wrapped around the technical skills of accounting, investing, and markets can contribute to explosive growth. A person who understands the tax advantages and protections provided by a corporation can get rich so much faster than someone who is an employee or a small-business sole proprietor. (Location 1236) A corporation earns, spends everything it can, and is taxed on anything that is left. It’s one of the biggest legal tax loopholes that the rich use. They’re easy to set up and are not expensive if you own investments that are producing good cashflow. (Location 1243) We all have tremendous potential, and we all are blessed with gifts. Yet the one thing that holds all of us back is some degree of self-doubt. (Location 1275) your financial genius requires both technical knowledge as well as courage. (Location 1285) Old ideas are their biggest liability. It is a liability simply because they fail to realize that while that idea or way of doing something was an asset yesterday, yesterday is gone. (Location 1305) I always encourage adult students to look at games as reflecting back to them what they know and what they need to learn. Most importantly, games reflect behavior. They are instant feedback systems. Instead of the teacher lecturing you, the game is giving you a personalized lecture, one that is custom-made just for you. (Location 1327) I have watched people playing CASHFLOW complain that the right opportunity cards are not coming their way. So they sit there. I know people who do that in real life. They wait for the right opportunity. (Location 1358) I have watched people get the right opportunity card and then not have enough money. Then they complain that they would have gotten out of the Rat Race if they had had more money. So they sit there. (Location 1359) And I have seen people pull a great opportunity card, read it out loud, and have no idea that it is a great opportunity. (Location 1362) “The poor and middle class work for money,” he would say. “The rich make money. (Location 1376) The single most powerful asset we all have is our mind. If it is trained well, it can create enormous wealth. (Location 1386) I can tell you why I have been developing this area of my intelligence. I do it because I want to make money fast. Not because I need to, but because I want to. It is a fascinating learning process. I develop my financial IQ because I want to participate in the fastest game and biggest game in the world. (Location 1389) The first time I sold the house, I paid back the $2,000, so technically, I have no money in the transaction. My return on investment (ROI) is infinity. It’s an example of no money making a lot of money. (Location 1423) For about 30 hours of work, approximately $190,000 was created in the asset column, and no taxes were paid. (Location 1438) Financial intelligence is made up of these four main technical skills: 1.   Accounting Accounting is financial literacy, or the ability to read numbers. This is a vital skill if you want to build businesses or investments. 2.   Investing Investing is the science of money making money. 3.   Understanding markets Understanding markets is the science of supply and demand Alexander Graham Bell gave the market what it wanted. So did Bill Gates. A $75,000 house offered for $60,000 that cost $20,000 was also the result of seizing an opportunity created by the market. Somebody was buying, and someone was selling. 4.   The law The law is the awareness of accounting corporate, state and federal regulations. I recommend playing by the rules. (Location 1449) Personally, I use two main vehicles to achieve financial growth: real estate and small-cap stocks. (Location 1476) The problem with “secure” investments is that they are often sanitized, that is, made so safe that the gains are less. (Location 1504) Of course, there is always risk. It is financial intelligence that improves the odds. Thus, what is risky for one person is less risky to someone else. (Location 1529) There are two kinds of investors: 1.   The first and most common type is a person who buys a packaged investment. (Location 1564) 2. The second type is an investor who creates investments. This investor usually assembles a deal in the same way a person who buys components builds a computer. (Location 1567) If you want to be the second type of investor, you need to develop three main skills. 1.   Find an opportunity that everyone else missed. (Location 1573) For example, a friend bought this rundown old house. It was spooky to look at. Everyone wondered why he bought it. What he saw that we did not was that the house came with four extra empty lots. (Location 1575) 2. Raise money. The average person only goes to the bank. This second type of investor needs to know how to raise capital, and there are many ways that don’t require a bank. To get started, I learned how to buy houses without a bank. It was the learned skill of raising money, more than the houses themselves, that was priceless. (Location 1579) 3. Organize smart people. Intelligent people are those who work with or hire a person who is more intelligent than they are. (Location 1591) It is what you know that is your greatest wealth. It is what you do not know that is your greatest risk. There is always risk, so learn to manage risk instead of avoiding it. (Location 1594) “You want to know a little about a lot” was rich dad’s suggestion. (Location 1652) Often I recommend joining a network-marketing company, also called multilevel marketing, if they want to learn sales skills. (Location 1719) If I were pushed out of that industry, my life’s skills would not be as valuable to another industry. (Location 1736) The reason so many talented people are poor is because they focus on building a better hamburger and know little to nothing about business systems. (Location 1746) Today, it is considered smart. Since people will skip from company to company rather than seek greater specialization in skills, why not seek to learn more than to earn? In the short term, it may earn you less, but it will pay dividends in the long term. (Location 1767) The main management skills needed for success are: 1.   Management of cash flow 2.   Management of systems 3.   Management of people (Location 1769) Being technically specialized has its strengths as well as its weaknesses. I have friends who are geniuses, but they cannot communicate effectively with other human beings and, as a result, their earnings are pitiful. I advise them to just spend a year learning to sell. Even if they earn nothing, their communication skills will improve. And that is priceless. (Location 1784) The primary difference between a rich person and a poor person is how they manage fear. (Location 1801) There are five main reasons why financially literate people may still not develop abundant asset columns that could produce a large cash flow. The five reasons are: 1.   Fear 2.   Cynicism 3.   Laziness 4.   Bad habits 5.   Arrogance (Location 1804) the greatest reason for lack of financial success was because most people played it too safe. “People are so afraid of losing that they lose” (Location 1830) For most people, the reason they don’t win financially is because the pain of losing money is far greater than the joy of being rich. (Location 1842) If you have little money and you want to be rich, you must first be focused, not balanced. (Location 1873) But if you have dreams of freedom—of getting out of the Rat Race—the first question to ask yourself is, “How do I respond to failure?” If failure inspires you to win, maybe you should go for it—but only maybe. (Location 1882) But a savvy investor knows that the seemingly worst of times is actually the best of times to make money. When everyone else is too afraid to act, they pull the trigger and are rewarded. (Location 1908) They tell me why I should not do it. When I ask them where they get their information, they say from a friend or an investment magazine. They’ve never done it, and they’re telling someone who’s doing it why they shouldn’t. (Location 1924) That is the thought pattern that keeps most people poor. They criticize instead of analyze. (Location 1937) If most people understood how a “stop” worked in stock-market investing, there would be more people investing to win instead of investing not to lose. A stop is simply a computer command that sells your stock automatically if the price begins to drop, helping to minimize your losses and maximize some gains. It’s a great tool for those who are terrified of losing. (Location 1956) So when you’re in doubt and feeling a little afraid, just do what Colonel Sanders did to his little chicken. He fried it. (Location 1965) So what is the cure for laziness? The answer is—a little greed. (Location 1975) Rich dad believed that the words “I can’t afford it” shut down your brain. “How can I afford it?” opens up possibilities, excitement, and dreams. (Location 1986) Rich dad said it differently: “Guilt is worse than greed, for guilt robs the body of its soul.” (Location 2013) “So you see, after paying myself, the pressure to pay my taxes and the other creditors is so great that it forces me to seek other forms of income. The pressure to pay becomes my motivation. I’ve worked extra jobs, started other companies, traded in the stock market, anything just to make sure those guys don’t start yelling at me. That pressure made me work harder, forced me to think, and all in all, made me smarter and more active when it comes to money. If I had paid myself last, I would have felt no pressure, but I’d be broke.” (Location 2036) “So if I pay myself first, I get financially stronger, mentally and fiscally.” Rich dad nodded. “And if I pay myself last, or not at all, I get weaker. So (Location 2047) I offer you the following 10 steps to awaken your financial genius. (Location 2072) 1. Find a reason greater than reality: the power of spirit If you ask most people if they would like to be rich or financially free, they would say yes. But then reality sets in. (Location 2079) When people ask me what my reason for wanting to be rich is, I tell them that it is a combination of deep emotional “wants” and “don’t wants.” (Location 2086) He could not even pass on what he worked so hard for when he died. The rich don’t do that. They work hard and pass it on to their children. (Location 2090) If they are not strong enough, then the reality of the road ahead may be greater than your reasons. I have lost money and been set back many times, but it was the deep emotional reasons that kept me standing up and going forward. I wanted to be free by age 40, but it took me until I was 47, with many learning experiences along the way. (Location 2093) 2. Make daily choices: the power of choice (Location 2098) Financially, with every dollar we get in our hands, we hold the power to choose our future: to be rich, poor, or middle class. Our spending habits reflect who we are. Poor people simply have poor spending habits. (Location 2099) But that is a choice we all make daily: the choice of what we do with our time, our money, and what we put in our heads. That is the power of choice. All of us have choice. I just choose to be rich, and I make that choice every day. (Location 2109) Most people simply buy investments rather than first investing in learning about investing. (Location 2113) I was watching this guy on TV who was advertising a three-day seminar on how to buy real estate for nothing down. I spent $385 and that course has made me at least $2 million, if not more. (Location 2117) Just because you bought a house or two does not make you an expert at real estate. (Location 2136) 3. Choose friends carefully: the power of association First of all, I do not choose my friends by their financial statements. I have friends who have actually taken a vow of poverty as well as friends who earn millions every year. The point is that I learn from all of them. (Location 2137) They don’t do it to brag. They’re interested in the subject. So I learn from them, and they learn from me. My friends who are in dire financial straits do not like talking about money, business, or investing. They often think it rude or unintellectual. So I also learn from my friends who struggle financially. I find out what not to (Location 2141) 4. Master a formula and then learn a new one: the power of learning quickly In order to make bread, every baker follows a recipe, even if it’s only held in their head. The same is true for making money. (Location 2167) If you’re tired of what you’re doing, or you’re not making enough, it’s simply a case of changing the formula via which you make money. (Location 2174) Another side note: In today’s fast-changing world, it’s not so much what you know anymore that counts, because often what you know is old. It is how fast you learn. That skill is priceless. It’s priceless in finding faster formulas—recipes, if you will—for making dough. Working hard for money is an old formula born in the day of cavemen. (Location 2184) 5. Pay yourself first: the power of self-discipline If you cannot get control of yourself, do not try to get rich. It makes no sense to invest, make money, and blow it. It is the lack of self-discipline that causes most lottery winners to go broke soon after winning millions. (Location 2187) this step is probably the most difficult to master if it is not already a part of your makeup. I would venture to say that personal self-discipline is the number-one delineating factor between the rich, the poor, and the middle class. (Location 2190) In the entrepreneur classes I teach, I constantly remind people to not focus on their product, service, or widget, but to focus on developing management skills. The three most important management skills necessary to start your own business are management of: 1.   Cash flow 2.   People 3.   Personal time (Location 2195) 2. When you come up short, let the pressure build and don’t dip into your savings or investments. Use the pressure to inspire your financial genius to come up with new ways of making more money, and then pay your bills. You will have increased your ability to make more money as well as your financial intelligence. (Location 2237) The rich know that savings are only used to create more money, not to pay bills. (Location 2242) What I pay a broker is tiny in comparison with what kind of money I can make because of the information they provide. (Location 2255) People who sell their house on their own must not value their time much. Why would I want to save a few bucks when I could use that time to make more money or spend it with those I love? (Location 2259) Many people only manage people they feel smarter than and they have power over. Many middle managers remain middle managers, failing to get promoted, because they know how to work with people below them, but not with people above them. The real skill is to manage and reward the people who are smarter than you in some technical area. (Location 2271) The sophisticated investor’s first question is: “How fast do I get my money back?” (Location 2287) move that will add value to the stock, like announcing a new product. I will move my money in for a week to a month while the stock moves up. Then I pull my initial dollar amount out, and stop worrying about the fluctuations of the market, because my initial money is back and ready to work on another asset. (Location 2290) “Well, he got lucky early in his trading, but lost everything a few days later. Then he really got interested. Today, I would say he is down $2,000, but his interest is up. He has read all the books I bought him, and he’s gone to the library to get more. He reads the Wall Street Journal voraciously, watching for indicators. He’s got only $1,000 left, but his interest and learning are sky-high. He knows that if he loses that money, he walks for two more years. But he does not seem to care. He even seems uninterested in getting a car, because he’s found a game that is more fun.” (Location 2315) Too often today, we focus on borrowing money to get the things we want instead of focusing on creating money. One is easier in the short term, but harder in the long term. (Location 2335) 9. Choose heroes: the power of myth (Location 2342) As a nine-year-old kid, when I stepped up to bat or played first base or catcher, I wasn’t me. I pretended I was a famous baseball player. It’s one of the most powerful ways we learn, and we often lose that as adults. We lose our heroes. (Location 2344) But heroes do more than simply inspire us. Heroes make things look easy. Making it look easy convinces us to want to be just like them. “If they can do it, so can I.” When it comes to investing, too many people make it sound hard. Instead, find heroes who make it look easy. (Location 2354) 10. Teach and you shall receive: the power of giving (Location 2356) Whenever you feel short or in need of something, give what you want first and it will come back in buckets. That is true for money, a smile, love, or friendship. I know it is often the last thing a person may want to do, but it has always worked for me. I trust that the principle of reciprocity is true, and I give what I want. I want money, so I give money, and it comes back in multiples. I want sales, so I help someone else sell something, and sales come to me. I want contacts, and I help someone else get contacts. Like magic, contacts come to me. I heard a saying years ago that went: “God does not need to receive, but humans need to give.” (Location 2362) - 💭 Give My dad taught teachers, and he became a master teacher. My rich dad always taught young people his way of doing business. In retrospect, it was their generosity with what they knew that made them smarter. There are powers in this world that are much smarter than we are. You can get there on your own, but it’s easier with the help of the powers that be. You only need to be generous with what you have. (Location 2378) - Stop doing what you’re doing. In other words, take a break and assess what is working and what is not working. (Location 2386) - Look for new ideas. For new investing ideas, I go to bookstores and search for books on different and unique subjects. I call them formulas. I buy how-to books on formulas I know nothing about. (Location 2388) - Find someone who has done what you want to do. (Location 2393) - Take classes, read, and attend seminars. (Location 2398) - Make lots of offers. When I want a piece of real estate, I look at many properties and generally write an offer. If you don’t know what the right offer is, neither do I. (Location 2402) - Finding a good deal, the right business, the right people, the right investors, or whatever is just like dating. You must go to the market and talk to a lot of people, make a lot of offers, counteroffers, negotiate, reject, and accept. I know single people who sit at home and wait for the phone to ring, but it’s better to go to the market, even if it’s only the supermarket. Search, offer, reject, negotiate, and accept are all parts of the process of almost everything in life. (Location 2417) - Shop for bargains in all markets. (Location 2429) Always remember: Profits are made in the buying, not in the selling. (Location 2432) Small people remain small because they think small, act alone, or don’t act all. (Location 2446) Practice. Start small. I turned $5,000 cash into a one-million-dollar asset producing $5,000 a month cash flow in less than six years. (Location 2487) I think I have made my message clear. It’s what is in your head that determines what is in your hands. Money is only an idea. (Location 2489) “Taxes are highest on earned income. The least-taxed income is passive income. (Location 2499) The CASHFLOW Quadrant is written about the core differences of these four types and how people can change their quadrant. In fact, most of our products are created for people in the B and I quadrants. In Rich Dad’s Guide to Investing, book number three in the Rich Dad series, I go into more detail on the importance of converting earned income into passive and portfolio income. (Location 2503) “A real investor makes money in an up market and a down market. That is why they make so much money.” One of the reasons they make more money is simply because they have more self-confidence. Rich dad would say, “They have more self-confidence because they are less afraid of losing.” In other words, the average investor does not make as much money because they are so afraid of losing money. (Location 2522)