Why Do Company’s Really Match 401k Contributions?

The average person, if they even have a retirement account, have a 401k which is investing in mutual funds. Don’t be average. Take responsibility and have some control 🙂 – Josh

There’s No Such Thing As Free Money

Posted on: Tuesday, January 31, 2012|Written by: Robert Kiyosaki

Get a Financial Education and Stop Thinking Like an Employee

Years ago I had a conversation with a young man about 401(k)s. “I have a question for you,” he said. “I’ve read that you say 401(k)s are the worst investments, but I don’t understand why you say that.”

“What is it that you don’t understand?” I asked.

“Well,” said the young man. “Most employers match your contribution. For instance, my employer matches up to four percent of my salary. Isn’t that a hundred percent return? Why is that a bad investment?”

“It’s a bad investment,” I said, “because it’s your money to begin with.”

He looked puzzled and perplexed.

“Listen,” I said, “if it weren’t for 401(k)s, your employer would have to pay you that money as part of your salary. As it is, they still pay it, but only if you give up four percent of your existing salary in to a retirement account where you have no control. And if you don’t, well the employer comes out ahead. It’s your money, but they’re in control.”

Thinking like an employee

The young man still didn’t look convinced, but I could tell he was thinking hard about it. The reason this young man and many others don’t understand my reasoning is that they only think like employees. As an employer, I know that if it weren’t for 401(k)s, I’d have to pay that money to employees in their salary in order to be competitive.

For me, as an employer, a 401(k) is an advantage because I don’t have to pay the money unless an employee opts in, and if they leave my company too early, I don’t have to pay because they aren’t vested.

A recent study confirms what I’m saying and should help those of you who still find this logic confusing or not convincing.

A 401(k) steals your money

A recent study confirms what I’m saying and should help those of you who still find this logic confusing or not convincing. According to Steven Gandel, a study issued by the Center for Retirement Research indicates that, “All else being equal…workers at companies that contributed to their employees’ 401(k) accounts tended to have lower salaries than those at companies that gave no retirement contribution…In fact, for many employees, the salary dip was roughly equal to the size of their employer’s potential contribution.”

Translation, companies that don’t offer 401(k)s must pay a higher salary to compete with companies that do. Those company’s employees simply get their money as part of their salary rather than having to match it and save it in a tax-deferred retirement plan where they have no control and have high fees.

No financial intelligence? Stick with the 401(k)

Control is an important aspect of investing. As I mentioned, with a 401(k), you have no control over your investments as you generally invest in funds and indexes controlled by brokers, who are controlled by bankers, who invest in companies that are controlled by boards — all of which you have no control over.

If you want to be rich, you must have a financial education and control over your money and your investments. This is why I like to invest in my own business, purchase real estate and create products. I have a lot of control over those investments. Generally a good matrix is the more control you have, the higher your potential return. The less control you have, the lower your potential return.

Of course, it takes high financial intelligence to invest in things where you have control because you have to make a lot of important decisions. This is why being forced into a 401(k) probably isn’t a bad thing for most people. This is because most people have little-to-no financial education and wouldn’t know what to do with the extra money other than save it or spend it.

But I expect the average Rich Dad reader to be head and shoulders above the average person in terms of financial intelligence. The reality is that if you’re investing in a 401(k), you’re not making a return on your employer’s match. You’re simply getting what is owed you by your employer.

For some, this might be the first time you’ve ever thought of this. For others, I’m probably preaching to the choir.

Some questions for the Rich Dad community

If you’ve avoided the 401(k) trap, what ways are you using that money to build your wealth outside of a 401(k)?

Fed Looks Foolish

Posted on: Tuesday, January 17, 2012|Written by: Robert Kiyosaki

Last week, I wrote about the Fed’s recent criticism of the U.S. government’s handling of the housing crisis, a crisis that still persists and may only be getting worse (“Fed Cries Foul?“).

According to a number of news sources, the Fed is considering taking unprecedented action in the housing markets by buying back more housing bad debt. And they are pressuring the government to step up efforts to loosen lending restrictions for borrowers and doing loan write-downs for owners who owe more than their house is worth through Freddie and Fannie.

This week, some new revelations about the Fed’s outlook during the run up to the housing crisis in 2006 were released in the form of that year’s meeting transcripts—and the Fed looks foolish.

According to The New York Times, “Meeting every six weeks to discuss the health of the nation’s economy, [Fed officials] gave little credence to the possibility that the faltering housing market would weigh on the broader economy, according to transcripts that the Fed released Thursday. Instead they continued to tell one another throughout 2006 that the greatest danger was inflation — the possibility that the economy would grow too fast.”

Additionally, the Fed poked fun at the growing concern by builders to move housing inventory, “The officials laughed about the cars that builders were offering as signing bonuses, and about efforts to make empty homes look occupied. They joked about one builder who said that inventory was ‘rising through the roof.'”

The implication of the transcripts are clear: the Fed had no clue that the floor was about to fall out from underneath them and the U.S. economy.

So, this begs the question, why do they think they’re now qualified to speak in the housing market?

In 2006, there were plenty of people with enough common sense to know that the housing crisis was going to be bad for the economy, but these were generally considered fringe economists or conspiracy theorists because they challenged the status quo.

Rather than listen, the Fed drank its own Kool-Aid on the fundamentals of the economic system, and the safety net that was supposed to be collateralized debt.

Today, many people, such as my friend and now Rich Dad blogger, Richard Duncan, author of The Dollar Crisis and The Corruption of Capitalism, are sounding the alarm about the coming collapse of the dollar that may result from the Fed’s continued call for printing more money and inflating the economy through debt.

Yet, today, the Fed continues to drink their Kool-Aid and move forward with blind faith — much like they did in 2006, when one Fed member stated upon Chairman Greenspan’s departure, “It’s fitting for Chairman Greenspan to leave office with the economy in such solid shape. The situation you’re handing off to your successor [Chairman Bernanke] is a lot like a tennis racquet with a gigantic sweet spot.”

Those must have been some pretty cheap strings.

The point of all this? I simply want you to understand that the so-called experts can not only be wrong, but they can be dangerously wrong. My hope is that you don’t drink Kool-Aid, whether it’s served by the Fed, or even myself, but that you increase your own financial literacy.

The mission of the Rich Dad Company is to equip you to think for yourself. We provide financial education that helps you do your research, gather all the information, analyze that information, and make your own informed decision.

Think for yourself and get a financial education.

This is why I rarely tell people what to do, but instead simply explain what I’m doing. I never want you to follow my advice blindly. I want you to think for yourself. What works for me may not work for you.

This is also why we redesigned our website to be more useful to you by providing free financial news and resources to help you make informed decisions.

At the end of the day, only you can save yourself and your family financially. Make the decision today to think for yourself and to take charge of your financial future.

We’ll be here to help with our financial education resources.

Essential Qualities of an Entrepreneur: Brand

Posted on: Tuesday, December 20, 2011|Written by: Robert Kiyosaki

In some ways, it’s fitting that I sit down to write about a brand as an essential quality of an entrepreneur this morning. All across the headlines are blazing the news of the death of Kim Jong Il at the age of 70 years old.

Interesting among the more standard news stories about the Kim’s reign — and the devastation it caused his country and his people — is an article in The Wall Street Journal on the mythic nature of Kim created by his propaganda machine.

According to the article, there are two filters through which Kim was viewed.

To his people, Kim is a “peerless leader, master of all knowledge and gifted athlete”— or at least gives the appearance as so — with huge banners and paintings showing his likeness all over the country of North Korea and carefully constructed photo ops and news stories painting him as such. Newscasters, announcing his death on television, we’re in tears as they reported the news.

To the world, Kim is a brutal dictator with a bizarre love of gray jumpsuits. He oversaw a country that declined from a communist regime over decades into one of the poorest and most brutal dictatorships in the world, imprisoning millions, killing untold numbers of his own people, and pushing scores of North Koreans into abject poverty and starvation.

But these are all perceptions, as no one really “knew” Kim. Very few world leaders actually met with him, and his own people only heard his voice once, in 1992, on a broadcast where he said, “Glory to the people’s heroic military.”

Eventually, however, as it does for everyone, the truth gets out. And that brings me to branding.

Over the last couple weeks, I’ve briefly shared some thoughts on the essential qualities of an entrepreneur, based out of the book, Midas Touch, by Donald Trump and me.

So far, I’ve written on strength of character and F.O.C.U.S. This week, I want to talk about the importance of a brand.

The Importance of Brand for An Entrepreneur

Many people think a brand is what you make, which is not true. What you make is simply a commodity. A brand is what communicates who you are as a person or a company and informs what you make.

A brand is different than a commodity. For instance, Coca-cola is a brand. Store-“brand” soda is a commodity — not a really a brand. Nobody collects Safeway-brand cola merchandise — and no one builds museums to celebrate the history of Kroger soda. They do for Coke though, because it is a brand — and one that people love.

A brand is important for an entrepreneur because it helps people instantly know what you stand for. For me, my brand is taking complex financial information and making it easy and fun to learn. My company represents that brand, and people trust me and my brand. My brand is authentic.

And that’s why today’s news is so interesting, because it communicates a universal truth about branding.

Kim Jong Il had a brand (we all do to a greater or lesser degree, and many refer to is as a reputation). To us, it’s clear that his brand was a brutal dictator. But we don’t really know, yet, what his brand was in his own country. He worked hard to pass himself off as a great man and leader to be revered and who cared for his people and country against a world out to get them. But I’ll wager that most North Koreans don’t buy that brand. Why? Because the reality of their lives as they starve and face persecution don’t measure up to that brand.

His brand is not authentic. It is a veneer held together by fear. Now that he’s dead, it will most likely unravel. News sources are indicating as much, with most world leaders predicting a huge and possibly violent power struggle on the horizon.

That is an important lesson in branding — your brand must be authentic, or you’ll eventually be found out. You can be successful by some measure with a brand that is not authentic, but eventually that lie will be found out and what you’ve built will come crashing down. Rather than shoot for a period of success by creating a false brand, a true entrepreneur seeks to build a legacy by creating a true brand.

And a true brand comes from doing what you love and building a great company that desires to share that love.

For me, I love to see people’s lives changed by financial education, just as my life was.

My company exists for that sole reason, and it’s reflected in my brand. I don’t need a propaganda machine to communicate that. My actions and the products of my company represent that, my employees live that, and my customers attest to that.

If you plan on being an entrepreneur, as I hope many of you are, I would challenge you to begin the process of self-discovery for both you and your company. Who are you, really? What are you passionate about? What defines you and your company?

Once you have discovered the answers to those questions, build your company around them and live them truly. Only then will you have a true and authentic brand, and only then will people look and you and say, “Yes, I know and love that brand.”

Don’t think you can fake it. Because you can’t. Eventually, everyone’s true brand comes out—just as it will for Kim Jong Il in North Korea.

FOCUS – “follow one course until successful!”

This is one of the greatest reads in a while! This post is a short summary of one of the chapter’s covered in Robert Kiyosaki’s and Donald Trump’s latest book, “Midas Touch.” I strongly recommend you pick up the book if you want to be a business owner or entrepreneur on any level. I love what he has to say about the information age that we all live in! – Joshua Gamen

————————————————–

Essential Qualities of an Entrepreneur: F.O.C.U.S.

I recently released my newest book, The Midas Touch: Why Some Entrepreneurs Get Rich and Others Don’t, with my good friend, Donald Trump. This is a book on entrepreneurship for entrepreneurs—something both Donald and I are extremely passionate about.

The reason Donald and I wrote this book is because we’ve learned the hard way that there are five, essential qualities entrepreneurs need to have in order to succeed. These qualities aren’t a guarantee for success, but not having them is a guarantee for failure. And we want you to succeed.

So, over the next few weeks, I’ll briefly share some thoughts on each quality. For more on each quality, I encourage you to purchase a copy of Midas Touch.

Last week, I wrote on the number one essential quality of an entrepreneur—strength of character. This week, I’m writing on essential quality #2—F.O.C.U.S.

Today, we live in a world of instant gratification.

When I was a kid, we had only a handful of channels on the television. If you wanted to know something, you had to go to the library and spend some time to look it up. If you wanted to know how someone was doing, you had to write them a letter – or if you had the money, call them long distance. And if you needed directions, you had to stop at a gas station to ask.

The world has changed since then. Now, there are thousands of channels on TV and most people can’t stay on one for more than a few minutes. If you want to know something, you look it up on Wikipedia in seconds through your computer or phone. If you want to know how all your friends are doing, you spend a few minutes on Facebook. If you want to talk to them, you text them – or six or seven of them – right away and all day long. And if you want directions, you hit a little map button on your phone.

This instant gratification is a result of living in the Information Age, which is a double-edged sword because living in the Information Age gives more people more opportunity than ever in history to become rich, but it also makes it harder to become rich because we’re all suffering from ADD.

Today, we live in a world that finds it hard to focus.

Because there is so much information at our finger tips, our minds, especially young people’s minds, are conditioned to move from one stimuli to the next. It is rare these days to focus on one thing for a sustained period of time.

If you want to be a successful entrepreneur, however, you have to learn to F.O.C.U.S. Simply, this means Following One Course of action Until Successful. This takes time and effort – and, as we talked about last week, strength of character.

For many entrepreneurs, it takes years to master a business sector or asset class. It takes the dedication of studying hard, building your financial education, cultivating relationships, and learning from mistakes. And during those years, you’re looking at many long days, putting in lots of hours for little-to-no pay.

The difference between wannabe entrepreneurs and successful ones = F.O.C.U.S.

At the end of the day, the difference between a successful entrepreneur and a wannabe entrepreneur is F.O.C.U.S. Many wannabe entrepreneurs are looking to get rich quick. So, when one avenue doesn’t pan out, they move onto the next. The problem is they are never successful because they never put in the time and effort required to be so.

Rich Dad has never been about getting rich quick.

We’ve always been about a lifelong journey of financial education.

No one is born an entrepreneur. You become an entrepreneur over many years of learning, hard work, and F.O.C.U.S.

 

Written by: Robert “Rich Dad” Kiyosaki

Essential Qualities of an Entrepreneur: Strength of Character

A couple weeks ago, I wrote about something hopeful I see in America, the rise of young people interested in entrepreneurship (“There’s Hope Yet”). More than ever, the upcoming generation wants to start businesses and pursue their passions by starting companies that will not only take care of them and their family, but also benefit society as a whole. I applaud this.

I recently released my newest book, The Midas Touch: Why Some Entrepreneurs Get Rich and Others Don’t, with my good friend, Donald Trump. This is a book on entrepreneurship for entrepreneurs—something both Donald and I are extremely passionate about.

The reason Donald and I wrote this book is because we’ve learned the hard way that there are five, essential qualities entrepreneurs need to have in order to succeed. These qualities aren’t a guarantee for success, but not having them is a guarantee for failure. And we want you to succeed.

So, over the next few weeks, I’ll briefly share some thoughts on each quality. For more on each quality, I encourage you to purchase a copy of Midas Touch.

Strength of Character

As a young man, I started a successful Velcro wallet business. This was in the early 1980’s and MTV was just starting to take off. My partners and I had the foresight to take advantage of the wave of rock bands coming out of MTV, and we licensed band names and logos to place on our wallets.

For a while, business boomed. We had thousands of distributors around the world shipping our wallets for us, and we had millions in sales. The problem is that we didn’t really know what we were doing. As a result, many of our sales partners were 120 or more days late on paying us or had skipped out entirely. Because of this, we couldn’t pay our vendors, didn’t have the materials to continue production, and were in danger of not paying our employees and our taxes. We were in a cash crunch.

I’ll never forget sitting down for lunch with my rich dad to go over my financials for the company. Looking over the financial state of my company he said to me, “Your company has financial cancer. You’ve mismanaged a company that could have been successful. You need to look at reality and admit you’re incompetent and that your business is a failure.”

It was a hard word to hear. Up till that point, we tried to hold on, thinking the next big break would come. But it never did, and things were going from bad to worse.

After that conversation, I went back to my partners, and we did the right thing. We liquidated our inventory, paid our employees what was due to them, and set aside enough money to pay our taxes. The company was finished, but at least we weren’t crooks.

That was my first major failure as an entrepreneur. But it wasn’t my last. And if there’s anything I’ve learned after 30+ years as an entrepreneur, it’s that you will fail. The question is not whether you’ll fall; it’s how many times will you stand up?

The #1 essential quality of an entrepreneur is Strength of Character.

In order to succeed, you must first have integrity to do the right thing, and second, have the fortitude to continue moving forward even in the face of failure. Those who lack strength of character quit in the face of failure. Those who have strength of character get stronger in the face of failure by learning and adapting for the next opportunity.

How strong is your character?

I leave you with one of my favorite commercials of all-time.

Written By: Robert Kiyosaki

Bailout: The name of the game

It is absolutely madness. Yesterday was a huge injection of dollars into the global financial system by central banks. It seems fiat currencies are swirling the drain now.. Look for precious metals to surge again and listen for new talk of a one world currency..It’s only a matter of time. However, as Robert says, “The people who understand that they must increase their financial education, save themselves and not rely on the rich, or the government, survive and thrive in times of crisis”

So increase your financial education which will lead to increase in cash flow. Rely on God and your faith, not the rich or the government, and thrive in these times of oppertunity! – Joshua Gamen

—————————————-

In my book, Conspiracy of the Rich: The 8 New Rules of Money, I write that bailouts are the name of the game. This means that the ultra rich will never suffer like the middle class and poor do in financial crisis. The institutions that are deemed “too big to fail” will always be bailed out. This also means that sometimes big institutions prefer financial crisis because they know they will be bailed out, and they also know they can make a lot of money from those bailouts.

This week, a bombshell hit on the lending practices of the Federal Reserve to the largest banks in the world during the peak of the financial crisis. As Bloomberg reports in an article entitled, “Secret Fed Loans Gave Banks Undisclosed $13B,”

“The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he ’wasn’t aware of the magnitude.’ It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP. Add up guarantees and lending limits, and the Fed had committed $7.77 trillion as of March 2009 to rescuing the financial system, more than half the value of everything produced in the U.S. that year.”

Additionally,

“The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates, Bloomberg Markets magazine reports in its January issue.”

Big gets bigger.

Everyone knew that the name of the game is bailouts for institutions that are too big to fail, and while news agencies have been talking about the gargantuan $7.7 billion in commitments by the Fed to save the economy, the details released this week through the Freedom of Information Act show what we’ve known all along – the rich will say anything to protect their ass-ets and build their balance sheets.

For instance, in November of 2008, Bank of America’s CEO, Kenneth Lewis said that his bank was “one of the strongest and most stable banks in the world.” On that same day, Bank of America owed $86 billion to the Federal Reserve in emergency loan money.

Jamie Dimon, CEO of JP Morgan Chase, told his shareholders in 2010 that he only borrowed from the Fed to encourage others to borrow from the Fed. In reality, the bank borrowed twice its cash holdings from the Fed, and on one day in February 2009, borrowed a colossal $48 billion – one year after the creation of the Fed’s emergency lending program.

All in all, the big six banks comprised of JPMorgan, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley accounted for 63 percent of all daily average lending by the Fed to banks and financial institutions, receiving over $160 billion in TARP funds and borrowing around $460 billion from the Fed.

During that time, “Total assets held by the six biggest U.S. banks increased 39 percent to $9.5 trillion on Sept. 30, 2011, from $6.8 trillion on the same day in 2006, according to Fed data.”

Additionally, the Fed helped prop up both Bear Sterns and Wachovia with emergency loans as they were being gobbled up by JPMorgan and Wells Fargo respectively. The Fed transferred $50 billion in secret loans to Wachovia to prevent financial collapse until Wells Fargo could seal the deal, and they sent $30 billion in secret loans to Bear Sterns so that JPMorgan could wrap up that deal—all while providing $29 billion in financing to JPMorgan to fund the deal.

Essentially, the Fed protected the bigger banks and helped them grow even bigger by keeping brain-dead banks on financial life support long enough to graft them into the bodies of bigger financial institutions like a financial Frankenstein.

This was all done in secret, and without the knowledge of the American people and the Congress.

The safety net.

This type of behavior is reckless because it creates a false safety net. The big banks and the ultra rich know they will be bailed out and so they take even greater risks, putting the economy at even greater risk, and playing games with your money.

As Professor Oliver Williamson says, “The banks that were too big got even bigger, and the problems that we had to begin with are magnified in the process. The big banks have incentives to take risks they wouldn’t take if they didn’t have government support. It’s a serious burden on the rest of the economy.”

Of course, this should come as no surprise, as the Fed doesn’t exist to protect the middle class and the poor. Rather, it exists to protect banks and the ultra rich. Something they’ve shown they can do well, efficiently, and without government knowledge or intervention.

Learn the rules of the rich with a financial education

All this is to show what I’ve been saying for many years, you can’t rely on the government to save you, and your definitely can’t rely on the Fed. The government doesn’t even know what’s going on in our financial policy and the Fed hides those details in order to help their friends on Wall Street…after all, the people who run the Fed used to work there, and probably will again someday. You don’t bite the hand that feeds.

If you want to avoid getting wiped out by the next financial crisis, you must understand the rules of the rich and play by those rules. With a new presidential election heating up this year, I’m sure you’ll hear many calls for hope and change on both sides. Many people will believe that their candidate will make a difference and that this will be the time things will change.

The reality is that nothing has changed in decades. The rich take care of the rich and grow richer. The poor and the middle class grow poorer. And the people who understand that they must increase their financial education, save themselves and not rely on the rich, or the government, survive and thrive in times of crisis.

Take charge of your financial future so that you can live large when hard times come.

Written by: Robert Kiyosaki

There’s Hope Yet

I have not put out much content the past few weeks in the form of blog posts or vids, the reason: I’ve been busy working on my business, complaining less about the system(my readers already know how I feel), and spending more time working to use the new rules of money to my advantage by building a business that provides value. -Joshua Gamen

———————————————————

Last week I shared with you a lot of bad news to prove a point—there’s reason to be angry (“Mad as Hell”). I also shared why being mad wasn’t enough and why you must do more than complain and protest. You must increase your financial IQ by pursuing solid financial education.

A couple weeks back, I also wrote on the Occupy movement, challenging them to start their own businesses and be the change they are calling for in the world rather than just sitting around and protesting (“Are You Occupied?”). I wrote:

In the end, the world isn’t changed by people who complain. It’s changed by people who do. Don’t like the way corporate America and Wall Street operate? Be part of changing the way America does business by being an entrepreneur who starts a company to not only make money but also make the world a better place, starting companies like TOMS, for instance.

This week, there’s still no shortage of bad news. It seems that Congress can’t win—even when cheating. The Super Congress, it appears, will fail to reach any consensus on federal deficit reduction. This means the government now has 12 months to fix the problem, a problem the Super Congress couldn’t fix with bent rules. There’s already talk that this might lead to another downgrade.

Also, the euro is in deep trouble as the growing debt crisis in Europe threatens to topple the currency and the world’s economy with it. Many now believe that the future of the euro rests in the European Central Bank’s (ECB) ability to print money. If that fails, or the ECB chooses not to create massive debt, the currency will fall, sending shockwaves throughout the world.

But amid all this, there is good news this week too in the form of an opinion piece written in The New York Times, entitled, Generation Sell.

The article focuses on the youngest generation that is coming of age, the millennial generation, born in the late 1970’s through the mid-1990’s. The generation is the biggest since the baby boomers, estimated from 70 to 80 million—and apparently the most entrepreneurial generation ever.

According to the article:

Today’s ideal social form is not the commune or the movement or even the individual creator as such; it’s the small business. Every artistic or moral aspiration—music, food, good works, what have you—is expressed in those terms.

Call it Generation Sell.

Bands are still bands, but now they’re little businesses, as well: self-produced, self-published, self-managed. When I hear from young people who want to get off the careerist treadmill and do something meaningful, they talk, most often, about opening a restaurant. Nonprofits are still hip, but students don’t dream about joining one, they dream about starting one. In any case, what’s really hip is social entrepreneurship—companies that try to make money responsibly, then give it all away.

While there is unfortunately a hint of distaste in the voice of the article’s author regarding this trend, I find this to be an extremely positive and important article. Why? Because if this trend is true and continues, the world will be a better place.

While the disaffected youth who make up the Occupy movement get all the press, they make up a very small percentage of the upcoming generation. General numbers for the protests are in the tens of thousands (though these numbers are often disputed as overblown), this compared to a upcoming generation that numbers close to 100 million.

Quietly in the background, with no real fanfare, millions of other young people are doing exactly what I’ve advised. Increasing their financial education, desiring to be entrepreneurs to make the world a better place, and starting businesses that drive our economy and allow them to not only do things they are passionate about—but do so with true influence.

That is the power of entrepreneurship.

I invite you to stop protesting with words and to start protesting with action. Increase your financial IQ, discover your passion, and start a business to make the world a better place. What have you got to lose?

Written by: Robert Kiyosaki

Mad As Hell

Unemployment, Greed and Lack of Financial Education

In the movie, Network, Howard Beale, an aging news anchor, gives one of the most famous speeches in movie history, capped with the line, “I’m as mad as hell, and I’m not going to take it anymore!”

Crazy-eyed and drenched in rain, he proceeds to encourage all of New York City to put their heads out the window and yell the same thing at the top of their lungs. Surprisingly, it happens and the whole city erupts in the yells of the residents’ pent up frustrations. Beale’s speech, set in 1975, is eerily relevant today as it deals with themes like inflation, unemployment, depression, and more.

I thought I’d share this speech with you:

I also thought I’d share some articles with you from the last couple weeks that will show you why, today in real life, many people are also as mad as hell:

• “Banks Extract Fees On Unemployment Benefits” – People who are broke and unemployed are now having to pay fees to the banks to get their unemployment money from the bank. It’s ironic that the actions of the banks lead to the financial crisis and now they’re punishing the very people they made poor.
• “BofA Retreats on Debit Fee, Citing Uproar” – Bank of America, greedy for more money, nearly put in place a plan to charge people $5 a month to access their own money via debit card before bowing to intense consumer pressure. The other greedy banks quickly abandoned their same plans.
• “The Net Worth of Congress Rose 23.6% Since 2008” – Rather than fix our economy, our politicians have instead, personally gotten richer. Further proof that financial crisis is good for the rich and bad for the poor and middle class, as explained in Conspiracy of the Rich.
• “Everyone on Wall Street Is Playing ‘Heads I Win, Tails You Lose’” – The rich and the powerful are using the system to get richer by playing by the new rules of money while everyone else loses money by playing by the old rules of money.
• “Why the Kids Are All Broke” – “A perfect storm of economic forces has caused the net worth of people under 35 to fall by 68 percent between 1984 and 2009 according to the Pew Research Center. It’s a bitter pill to swallow for the young and depraved given that the nation’s olds (people 65 or older) saw a net worth increase of 42 percent in the same period.”
• “The true picture of US unemployment” – While the government wants you to believe unemployment is around 9 percent, the true unemployment rate is around 16.5 percent. Many people have been out of work so long that they’ve simply quit looking.

As you can see, there’s plenty of reason to be mad as hell. The question is, what are you going to do about it?

In the movie, Network, people stick their heads out the window and yell. It’s a poignant yet pointless moment. It doesn’t change a thing.

In the streets today, many people are doing the equivalent of sticking their heads out the window and yelling. They’re sitting in parks and unsure what will happen next. Others are complaining on blogs. Seems everyone shares the sentiment that they “aren’t going to take it anymore,” but very few people are doing anything about it.

As I’ve written before, I don’t think yelling and protesting will fix our problems. They only make us feel better for a while, but at the end of the day, our situation is the same.

Instead, I believe that financial education is the only way to change our life and the lives of others.

After all, the reason why the rich and powerful can take advantage of us and game the system is because they have a financial education, and the average person knows nothing about money or how the rich use it to get richer off of them.

Instead of yelling, throw your energy into financial education and learn about money and investing. Instead of protesting, take action and beat the rich at their own game. Instead of complaining, be part of the solution.

As the few articles above show, there is plenty of legitimate reason to be angry. Most people have been dealt a bad hand. But life isn’t fair, and those that win in life are those who make their own cards. We’re all mad as hell. Let’s do something about it that will create a better future for us and our families, not just an interesting footnote in the history books.

To increase your financial education now, visit our free resources and community here.

Written by: Robert Kiyosaki

Economic Update: Information – Taxes – Gold n Silver

This week we are talking about information, and how it effects you if you are a trader or a cash flow investor. We’ll talk a bit more about employment. Also on the agenda is the tax code and why it is set up the way it is. Of course I’m going to rant about gold and silver. And then I’ll let you know what I see this weekend in the BCS 

 

From Tom Wheelwright: The Power of Systems in your wealth strategy

I’m constantly asked how to use leverage in different ways in a wealth strategy – and I’m glad people are asking because leverage plays a huge role in every successful wealth strategy.

Leverage is simply doing more with less.

Here are 3 of my favorite forms of leverage.

#1: Systems
I think systems are one of the most important and powerful features of a wealth strategy.

Systems are simply the process or procedures to complete specific tasks. Systems provide the detail of the who, what, when, where and how something will be done.

Think about a franchise. One of the greatest values a franchise offers is its systems. The systems provide all the details about how to market, sell, fulfill and everything else involved in operating that franchise. A franchisee simply has to follow the systems.

Let’s say you invest in rental real estate. You should have systems for:

– Identifying the property to buy
– Purchasing / financing the property
– Renting the property
– Maintaining the property
– Reviewing the performance of the property

Systems don’t have to be complicated. They just need to document what needs to be done in a clear manner. Systems can be as simple as a checklist.

If you are just starting your wealth strategy, you may wonder why you need systems if you are doing everything.

Here’s 2 reasons why you need systems:

Reason #1
Your systems are the place to document the specific details of what needs to be done. They are also the place to document your best practices – your trade secrets. As you learn better ways to do things, document that in your systems.

Your systems enable you to leverage your time by making you more efficient while still getting the results you desire.

Reason #2
Many people start off doing everything themselves, but they usually have a goal to grow their wealth and hire others do the work. If you want to do this successfully, systems are imperative. Systems communicate your specific expectations without you having to be there.

Many people have wealth strategies that never reach their full potential because they are not able to give up control.

With systems, you don’t have to give up control. You’re giving up the specific tasks, but you are still in control. You control the systems.

When your systems are created, used and monitored properly, they will tell you when things are working and when they aren’t working. This allows you to focus your attention where it is most needed – this is a huge form of leverage in a wealth strategy.

#2: Your Wealth Team
Systems definitely take time to create. You don’t have do it all yourself though. This is where your wealth team comes in to play.

One of the best examples of leverage in a wealth strategy, and also one of my favorites, is a wealth team.

A wealth team is a group of advisors, coaches, mentors, employees, vendors and other contacts who assist you in building your wealth.

With a wealth team, you can leverage your time by hiring advisors, coaches, mentors, employees and/or vendors. But the leverage doesn’t stop there. This is just the beginning. You can also leverage your wealth team’s contacts, their resources, their knowledge – the list goes on and on.

Use your wealth team to help you create your systems. Leverage their resources and expertise to add value to your systems.

Once you’ve created your systems, share them with your team members so they can be part of the systems and contribute to the success of your wealth strategy.

#3: Software
Software is a wonderful form of leverage. Software allows us to do more with less every day.

Software can be an integral part of effective systems. When used properly, software can streamline many tasks while providing better information and results.

Software can be the driving force behind the systems. It can notify the who about the what, when, where and how. And, it can provide real time reports about how the systems are working. These reports are what help you stay in control.

How do you know what software to use?
Leverage your team’s knowledge – ask them what software you should be using. And, if you truly want to leverage your software with your systems, have a team member who is committed to integrating the two.

Using Leverage in Your Wealth Strategy
Think about how you use these 3 forms of leverage in your wealth strategy and identify ways that you can leverage them even more.

Focus on your wealth!

Tom Wheelwright
Founder & CEO