On his blog, Robert Kiyosaki writes about how the rich are getting richer but not through saving their money. He shares tips for how you can make your money work for you and ultimately become rich in the process.
We will examine why the outspoken personal finance expert believes in paying yourself first and that “savers are losers.”
What Does Robert Kiyosaki Say About Paying Ourselves First?
Kiyosaki, the author behind the popular Rich Dad Poor Dad brand and book, is a proponent of paying yourself first. He also urges readers to invest their money instead of letting it sit around in a bank account because of inflation.
When Kiyosaki was broke, he decided with his wife that if they wanted to achieve their dreams, they had to pay themselves first before paying their creditors. This is where they came up with the 10/10/10 plan, where every month, they treated this money that they set aside as an expense instead of an asset. So this plan with the three ten’s adds up to 30%, which refers to how much of your paycheck should be used for paying yourself first. In this plan, 30% of their paychecks went into the following:
- Investments — 10%
- Charity — 10%
- Savings — 10%
While Kiyosaki isn’t a fan of leaving money in a savings account where it earns a tiny amount of interest, he wants you to get into the habit of paying yourself first so that you have money to invest. If you don’t pay yourself first, you’ll never have the money you need to invest in assets that will lead to financial freedom in the future.
How Can You Get Rich?
According to Kiyosaki, he believes that savers are losers, as he’s gone on record to state this many times. The logic behind this is that most people confuse the difference between investing and saving. When saving money by leaving it in a basic banking account, you’re earning a low-interest rate. So, let’s say you earn 1% on your money, and inflation is at 8%. You’re losing out since your money isn’t growing enough to keep up with the rising cost of living.
The article on Kiyosaki’s blog had the following to say about investing instead of saving:
“You don’t have to go out and buy a ten-unit apartment building or throw all of your money in the stock market. But, you have to do something! Learn about other options… just get started; do anything but rely on savings. Remember, savers are losers.”
The goal of this piece of content is to inspire readers to take action with their savings instead of letting their money sit in an account that barely earns any interest when there are assets worth investing in.
Kiyosaki wants readers to seek out advice from those who are successful and practice what they preach when it comes to investing and financial results. He believes that financial planners are not a viable option for education since you’ll likely get a sales pitch.
While Kiyosaki started by investing in one-ounce silver coins, you can invest in other assets as long as you begin learning and taking action. It doesn’t matter if you start with $100 or $1,000, as long as you have some money invested in assets instead of keeping it in a savings account.
Closing Thoughts
Kiyosaki believes it doesn’t matter how much money you have, but ultimately, it’s what you do with your money that determines your financial trajectory. The goal is to pay yourself first and always to have money to invest. Once you have money for investments, you should learn about assets worth investing in so that your money grows faster than the inflation rate. As always, we suggest you conduct due diligence before investing your hard-earned money.
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