Robert T. Kiyosaki’s ‘Rich Kid, Smart Kid’ is one of few personal finance books that take an aggressive approach toward changing the conventional view around education and money management. Most financial self-help books provide a basic understanding of saving and budgeting; however, Kiyosaki’s exceptionally unique and important book explores the psychology of learning, the intelligence level of financial awareness, and the inherent flaws of the current educational system. Rather than being just a book about money, or ‘financial literacy’, ‘Rich Kid, Smart Kid’ is an almost inflammatory roadmap – a way to help prepare children to be able to survive and thrive in a rapidly changing environment.
Kiyosaki asserts that schools are excellent at creating employees but not necessarily people who have a significant level of financial intelligence. One of Kiyosaki’s more compelling ideas is that the banker does not ask for your report card; he asks for your financial statements’; therefore, academic success does not guarantee future success.
This book does a great job of contrasting the “Industrial Age” mindset and how we live in today’s “Information Age”. Kiyosaki discusses how jobs, the stability from a career, pensions, and government assistance being the norm 30 years ago are no longer valid. With continuous changes in technology, automation, and an unstable economy, we have to adapt and learn to be financially literate. Since Kiyosaki wrote this book (a long time ago), it is wonderful to see how accurate he was in predicting how things would be today with AI (Artificial Intelligence), remote working, and digital entrepreneurship.
One of the most intriguing aspects of this book is how much Kiyosaki talks about different types of intelligence. His definition of intelligence challenges our longstanding belief in IQ in the educational system. He believes every single child has their own type of genius. Schools reward primarily verbal or academic intelligence; they don’t reward the other many types of intelligence — practical, creative, athletic, emotional, and financial. Kiyosaki’s perspective of challenging the traditional schools’ thoughts can help children who may not perform well in a traditional classroom but excel with their genius-level intelligence in other ways of living.
At the core of this book is the idea of financial IQ. Financial intelligence, according to Kiyosaki, should not be determined by income; it should be determined by how much money you keep and, more importantly, how hard the money you have works for you. Kiyosaki further describes wealth to be defined by the things wealth can do for you, such as providing freedom, happiness, health, and choices. Wealth will not create stress, debt, and the endless search for work. Financial independence differs significantly from the modern consumerism mentality found in much of the world today, where too many high-income earners are continuing to suffer from financial insecurity.
Another important theme that Kiyosaki covers is the value of experiential learning. Kiyosaki firmly believes that children learn best through doing, playing, experimenting, and even by making mistakes. He is critical of the educational system, which does not support failure but instead penalises it. The author’s storytelling method is filled with examples from his personal life, life lessons from his “rich dad” and “poor dad,”, and other real-life situations that make financial concepts much easier to understand and much more fun to relate to.
This book also discusses ideas about being a parent in a significantly insightful manner. Kiyosaki asserts that children learn more by observing than by receiving instruction, thus placing parents in a position of significant influence over their children’s education. This theme helps elevate Kiyosaki’s work from a simple financial guide to a profound study of leadership, values, and responsibility.
What makes this book special is its ability to cause introspection on some uncomfortable yet necessary questions:
- Will today’s educational system prepare our children for financial independence?
- Will the next generation be able to function as adults without academic education only?
- Are you teaching your child how to think, or just memorising things?
Now, over twenty years later, the themes presented in Rich Dad, Smart Kid, are as applicable as they were at the time of publishing. It is a thought-provoking, stimulating, and transformational masterwork, which challenges readers to re-evaluate education, success, and wealth. For parents, teachers, entrepreneurs, and young people looking to understand financial freedom on a deeper level, this work is not simply recommended; it is required reading.
