Chapter Six
                             Job security meant everything to my educated dad.
                             Learning meant everything to my rich dad.
   A few years ago, I granted an interview with a newspaper in Singapore. The young female reporter was on time, and the interview got under way immediately. We sat in the lobby of a luxurious hotel, sipping coffee and discussing the purpose of my visit to Singapore. I was to share the platform with Zig Ziglar. He was speaking on motivation, and I was speaking on “The Secrets of the Rich.”
   “Someday, I would like to be a best-selling author like you,” she said. I had seen some of the articles she had written for the paper, and I was impressed. She had a tough, clear style of writing. Her articles held a reader’s interest.
   “You have a great style,” I said in reply. “What holds you back from achieving your dream?”
   “My work does not seem to go anywhere,” she said quietly. “Everyone says that my novels are excellent, but nothing happens. So I keep my job with the paper. At least it pays the bills. Do you have any suggestions?”
   “Yes, I do,” I said brightly. “A friend of mine here in Singapore runs a school that trains people to sell. He runs sales-training courses for many of the top corporations here in Singapore, and I think attending one of his courses would greatly enhance your career.”
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   She stiffened. “Are you saying I should go to school to learn to sell?”
   I nodded.
   “You aren’t serious, are you?”
   Again, I nodded. “What is wrong with that?” I was now back-pedaling. She was offended by something, and now I was wishing I had not said anything. In my attempt to be helpful, I found myself defending my suggestion. “I have a master’s degree in English Literature. Why would I go to school to learn to be a salesperson? I am a professional. I went to school to be trained in a profession so I would not have to be a sales person. I hate salespeople. All they want is money. So tell me why I should study sales?” She was packing her briefcase. The interview was over.
   On the coffee table sat a copy of an earlier best-selling book I wrote. I picked it up as well as the notes she had jotted down on her legal pad.
   “Do you see this?” I said pointing to her notes.
   She looked down at her notes. “What?” she said, confused. Again, I pointed deliberately to her notes. On her pad she had written: “Robert Kiyosaki, best-selling author.”
   “It says best-selling author, not best-writing author,” I said quietly.
Her eyes widened.
   “I am a terrible writer,” I said. “You are a great writer. I went to sales school. You have a master’s degree. Put them together and you get a ‘best-selling author’ and a ‘best-writing author.’”
   Anger flared from her eyes. “I’ll never stoop so low as to learn how to sell. People like you have no business writing. I am a professionally trained writer and you are a salesman. It is not fair,” she fumed.
   She put the rest of her notes away and hurried out through the large glass doors into the humid Singapore morning.
   At least she gave me a fair and favorable write-up the next morning. The world is filled with smart, talented, educated, and gifted people. We meet them every day. They are all around us.
   A few days ago, my car was not running well. I pulled into a garage, and the young mechanic had it fixed in just a few minutes. He knew what was wrong by simply listening to the engine. I was amazed.

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      I am constantly shocked at how little talented people earn. I have met brilliant, highly educated people who earn less than $20,000 a year. A business consultant who specializes in the medical trade was telling me how many doctors, dentists, and chiropractors struggle financially. All this time, I thought that when they graduated, the dollars would pour in. It was this business consultant who gave me the phrase: “They are one skill away from great wealth.”
   What this phrase means is that most people need only to learn and master one more skill and their income would jump exponentially. I have mentioned before that financial intelligence is a synergy of accounting, investing, marketing, and law. Combine those four technical skills and making money with money is easier than most people would believe. When it comes to money, the only skill most people know is to work hard.
   The classic example of a synergy of skills was that young writer for the newspaper. If she diligently learned the skills of sales and marketing, her income would jump dramatically. If I were her, I would take some courses in advertising copywriting as well as sales. Then, instead of working at the newspaper, I would seek a job at an advertising agency. Even if it were a cut in pay, she would learn how to communicate in short-cuts that are used in successful advertising. She also would spend time learning public relations, an important skill. She would learn how to get millions in free publicity. Then, at night and on weekends, she could be writing her great novel. When it was finished, she would be better able to sell her book. Then, in a short while, she could be a “bestselling author.”
   When I came out with my first book, If You Want To Be Rich and Happy, Don’t Go to School, a publisher suggested I change the title to The Economics of Education. I told the publisher that, with a title like that, I would sell two books: one to my family, and one to my best friend. The problem is that they would expect it for free. The obnoxious title, If You Want To Be Rich and Happy, Don’t Go to School, was chosen because we knew it would get tons of publicity. I am pro-education and believe in education reform. If I were not pro-education, why would 

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I continue to press for changing our antiquated educational system? So I chose a title that would get me on more TV and radio shows, simply because I was willing to be controversial. Many people thought I was a fruitcake, but the book sold and sold.
   When I graduated from the U.S. Merchant Marine Academy in 1969, my educated dad was happy. Standard Oil of California had hired me for its oil-tanker fleet as a third mate. The pay was low compared with my classmates, but it was okay for a first real job after college. My starting pay was about $42,000 a year, including overtime, and I only had to work for seven months. I had five months of vacation. If I had wanted to, I could have taken the run to Vietnam with a subsidiary shipping company and easily doubled my pay instead of taking five months of vacation.
   I had a great career ahead of me, yet I resigned after six months with the company and joined the Marine Corps to learn how to fly. My educated dad was devastated. Rich dad congratulated me.
   In school and in the workplace, the popular opinion is the idea of specialization: that is, in order to make more money or get promoted, you need to specialize. That is why medical doctors immediately begin to seek a specialty such as
“You want to know                            orthopedics or pediatrics. The same
a little about a lot”                            is true for accountants, architects,
was rich dad’s                                     lawyers, pilots, and others.
suggestion.                                          My educated dad believed in the same dogma. That is why he was thrilled when he eventually achieved his doctorate. He often admitted that schools reward people who study more and more about less and less.
   Rich dad encouraged me to do exactly the opposite. “You want to know a little about a lot” was his suggestion. That is why for years I worked in different areas of his companies. For a while, I worked in his accounting department. Although I would probably never have been an accountant, he wanted me to learn via osmosis. Rich dad knew I would pick up jargon and a sense of what is important and what is not. I also worked as a bus boy and construction worker as 

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well as in sales, reservations, and marketing. He was grooming Mike and me. That is why he insisted we sit in on the meetings with his bankers, lawyers, accountants, and brokers. He wanted us to know a little about every aspect of his empire.
   When I quit my high-paying job with Standard Oil, my educated dad had a heart-to-heart talk with me. He was bewildered. He could not understand my decision to resign from a career that offered high pay, great benefits, lots of time off, and opportunity for promotion. When he asked me one evening, “Why did you quit?” I could not explain it to him, though I tried hard to. My logic did not fit his logic. The big problem was that my logic was my rich dad’s logic. Job security meant everything to my educated dad. Learning meant everything to my rich dad.
   Educated dad thought I went to school to learn to be a ship’s officer. Rich dad knew that I went to school to study international trade. So as a student, I made cargo runs, navigating large freighters, oil tankers, and passenger ships to the Far East and the South Pacific. Rich dad emphasized that I should stay in the Pacific instead of taking ships to Europe because he knew that the emerging nations were in Asia, not Europe. While most of my classmates, including Mike, were partying at their fraternity houses, I was studying trade, people, business styles, and cultures in Japan, Taiwan, Thailand, Singapore, Hong Kong, Vietnam, Korea, Tahiti, Samoa, and the Philippines. I was partying also, but it was not in any frat house. I grew up rapidly.
   Educated dad just could not understand why I decided to quit and join the Marine Corps. I told him I wanted to learn to fly, but really I wanted to learn to lead troops. Rich dad explained to me that the hardest part of running a company is managing people. He had spent three years in the Army; my educated dad was draft-exempt. Rich dad valued learning to lead men into dangerous situations. “Leadership is what you need to learn next,” he said. “If you’re not a good leader, you’ll get shot in the back, just like they do in business.”
   Returning from Vietnam in 1973, I resigned my commission, even though I loved flying. I found a job with Xerox Corp. I joined it for 

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one reason, and it was not for the benefits. I was a shy person, and the thought of selling was the most frightening subject in the world. Xerox has one of the best sales-training programs in America.
   Rich dad was proud of me. My educated dad was ashamed. Being an intellectual, he thought that salespeople were below him. I worked with Xerox for four years until I overcame my fear of knocking on doors and being rejected. Once I could consistently be in the top five in sales, I again resigned and moved on, leaving behind another great career with an excellent company.
   In 1977, I formed my first company. Rich dad had groomed Mike and me to take over companies. So I now had to learn to form them and put them together. My first product, the nylon-and-Velcro wallet, was manufactured in the Far East and shipped to a warehouse in New York, near where I had gone to school. My formal education was
Job is an acronym for                           complete, and it was time to test my
“Just Over Broke.”                        wings. If I failed, I would go broke. Rich dad thought it best to go broke before 30. “You still have time to recover” was his advice. On the eve of my 30th birthday, my first shipment left Korea for New York.
   Today, I still do business internationally. And as my rich dad encouraged me to do, I keep seeking the emerging nations. Today my investment company invests in South American countries and Asian countries, as well as in Norway and Russia.
   There is an old cliché that goes: “Job is an acronym for ‘Just Over Broke.’” Unfortunately, I would say that applies to millions of people. Because school does not think financial intelligence is an intelligence, most workers live within their means. They work and they pay the bills.
   There is another horrible management theory that goes, “Workers work hard enough to not be fired, and owners pay just enough so that workers won’t quit.” And if you look at the pay scales of most companies, again I would say there is a degree of truth to that statement.
   The net result is that most workers never get ahead. They do what they’ve been taught to do: Get a secure job. Most workers focus on 

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working for pay and benefits that reward them in the short term, but are often disastrous in the long run.
   Instead, I recommend to young people to seek work for what they will learn, more than what they will earn. Look down the road at what skills they want to acquire before choosing a specific profession and before getting trapped in the Rat Race.
   Once people are trapped in the lifelong process of bill-paying, they become like those little hamsters running around in those metal wheels. Their little furry legs are spinning furiously, the wheel is turning furiously, but come tomorrow morning, they’ll still be in the same cage. Great job.
   In the movie Jerry Maguire starring Tom Cruise, there are many great one-liners. Probably the most memorable is: “Show me the money.” But there is one line I thought most truthful. It comes from the scene where Tom Cruise is leaving the firm. He has just been fired, and he is asking the entire company, “Who wants to come with me?” And the whole place is silent and frozen. Only one woman speaks up and says, “I’d like to, but I’m due for a promotion in three months.”
   That statement is probably the most truthful statement in the whole movie. It is the type of statement that people use to keep themselves busy, working away to pay bills. I know my educated dad looked forward to his pay raise every year, and every year he was disappointed. So he would go back to school to earn more qualifications so he could get another raise. Then, once again, there would be another disappointment.
   The question I often ask people is, “Where is this daily activity taking you?” Just like the little hamster, I wonder if people look at where their hard work is taking them. What does the future hold?
   In his book The Retirement Myth, Craig S. Karpel writes: “I visited the headquarters of a major national pension consulting firm and met with a managing director who specializes in designing lush retirement plans for top management. When I asked her what people who don’t have corner offices will be able to expect in the way of pension income, she said with a confident smile, ‘The Silver Bullet’.

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               “What, I asked, is ‘The Silver Bullet?’”
        “She shrugged and said, ‘If baby boomers discover they don’t have enough money to live on when they’re older, they can always blow their brains out.’”
   Karpel goes on to explain the difference between the old defined-benefit retirement plans and the new 401(k) plans that are riskier. It is not a pretty picture for most people working today. And that is just for retirement. Add medical fees and long-term nursing-home care and the picture is frightening.
   Already, many hospitals in countries with socialized medicine need to make tough decisions such as, “Who will live, and who will die?” They make those decisions purely on how much money they have and how old the patients are. If the patient is old, they often will give the medical care to someone younger. The older poor patient gets put to the back of the line. Just as the rich can afford better education, the rich will be able to keep themselves alive, while those who have little wealth will die.
   So I wonder: Are workers looking into the future or just until their next paycheck, never questioning where they are headed?
   When I speak to adults who want to earn more money, I always recommend the same thing. I suggest taking a long view of their life. Instead of simply working for the money and security, which I admit are important, I suggest they take a second job that will teach them a second skill. Often I recommend joining a network-marketing company, also called multilevel marketing, if they want to learn sales skills. Some of these companies have excellent training programs that help people get over their fear of failure and rejection, which are the main reasons people are unsuccessful. Education is more valuable than money, in the long run.
   When I offer this suggestion, I often hear in response, “Oh that is too much hassle,” or “I only want to do what I am interested in.”
   If they say, “It’s too much of a hassle,” I ask, “So you would rather work all your life giving 50 percent of what you earn to the government?” If they tell me, “I only do what I am interested in,”

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       I say, “I’m not interested in going to the gym, but I go because I want to feel better and live longer.”
   Unfortunately, there is some truth to the old statement, “You can’t teach an old dog new tricks.” Unless a person is used to changing, it’s hard to change.
   But for those of you who might be on the fence when it comes to the idea of working to learn something new, I offer this word of encouragement: Life is much like going to the gym. The most painful part is deciding to go. Once you get past that, it’s easy. There have been many days I have dreaded going to the gym, but once I am there and in motion, it is a pleasure. After the workout is over, I am always glad I talked myself into going.
   If you are unwilling to work to learn something new and instead insist on becoming highly specialized within your field, make sure the company you work for is unionized. Labor unions are designed to protect specialists. My educated dad, after falling from grace with the governor, became the head of the teachers union in Hawaii. He told me that it was the hardest job he ever held. My rich dad, on the other hand, spent his life doing his best to keep his companies from becoming unionized. He was successful. Although the unions came close, rich dad was always able to fight them off.
   Personally, I take no sides because I can see the need for and the benefits of both sides. If you do as school recommends, become highly specialized. Then seek union protection. For example, had I continued with my flying career, I would have sought a company that had a strong pilots union. Why? Because my life would be dedicated to learning a skill that was valuable in only one industry. If I were pushed out of that industry, my life’s skills would not be as valuable to another industry. A displaced senior pilot—with 100,000 hours of heavy airline transport time, earning $150,000 a year—would have a hard time finding an equivalent high-paying job teaching in school. Skills do not necessarily transfer from industry to industry. Skills the pilots are paid for in the airline industry are not as important in, say, the school system.

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         The same is true even for doctors today. With all the changes in medicine, many medical specialists are needing to conform to medical organizations such as HMOs. Schoolteachers definitely need to be union members. Today in America, the teachers union is the largest and the richest labor union of all. The NEA, the National Education Association, has tremendous political clout. Teachers need the protection of their union because their skills are also of limited value to an industry outside of education. So the rule of thumb is: “Highly specialized; then unionize.” It’s the smart thing to do.
   When I ask the classes I teach, “How many of you can cook a better hamburger than McDonald’s?” almost all the students raise their hands. I then ask, “So if most of you can cook a better hamburger, how come McDonald’s makes more money than you?”
   The answer is obvious: McDonald’s is excellent at business systems. 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.
   A friend of mine in Hawaii is a great artist. He makes a sizable amount of money. One day his mother’s attorney called to tell him that she had left him $35,000. That is what was left of her estate after the attorney and the government took their shares. Immediately, he saw an opportunity to increase his business by using some of this money to advertise. Two months later, his first four-color, full-page ad appeared in an expensive magazine that targeted the very rich. The ad ran for three months. He received no replies from the ad, and all of his inheritance is now gone. He now wants to sue the magazine for misrepresentation.
   This is a common case of someone who can build a beautiful hamburger, but knows little about business. When I asked him what he learned, his only reply was, “Advertising salespeople are crooks.” I then asked him if he would be willing to take a course in sales and a course in direct marketing. His reply, “I don’t have the time, and I don’t want to waste my money.”
   The world is filled with talented poor people. All too often, they’re poor or struggle financially or earn less than they are capable of, not 

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because of what they know, but because of what they do not know. They focus on perfecting their skills at building a better hamburger rather than the skills of selling and delivering the hamburger. Maybe McDonald’s does not make the best hamburger, but they are the best at selling and delivering a basic average burger.
   Poor dad wanted me to specialize. That was his view on how to be paid more. Even after being told by the governor of Hawaii that he could no longer work in state government, my educated dad continued to encourage me to get specialized. Educated dad then took up the cause of the teachers’ union, campaigning for further protection and benefits for these highly skilled and educated professionals. We argued often, but I know he never agreed that overspecialization is what caused the need for union protection. He never understood that the more specialized you become, the more you are trapped and dependent on that specialty.
   Rich dad advised that Mike and I groom ourselves. Many corporations do the same thing. They find a young bright student just out of business school and begin grooming that person to someday take over the company. So these bright young employees do not specialize in one department. They are moved from department to department to learn all the aspects of business systems. The rich often groom their children or the children of others. By doing so, their children gain an overall knowledge of the operations of the business and how the various departments interrelate.
   For the World War II generation, it was considered bad to skip from company to company. 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.

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The main management skills needed for success are: 

1. Management of cash flow
2. Management of systems
3. Management of people
   The most important specialized skills are sales and marketing. The ability to sell—to communicate to another human being, be it a customer, employee, boss, spouse, or child—is the base skill of personal success. Communication skills such as writing, speaking, and negotiating are crucial to a life of success. These are skills I work on constantly, attending courses or buying educational resources to expand my knowledge.
   As I have mentioned, my educated dad worked harder and harder the more competent he became. He also became more trapped the more specialized he got. Although his salary went up, his choices diminished. Soon after he was locked out of government work, he found out how vulnerable he really was professionally. It is like professional athletes who suddenly are injured or are too old to play. Their once high-paying position is gone, and they have limited skills to fall back on. I think that is why my educated dad sided so much with the unions after that. He realized how much a union would have benefited him.
   Rich dad encouraged Mike and me to know a little about a lot. He encouraged us to work with people smarter than we were and to bring smart people together to work as a team. Today it would be called a synergy of professional specialities.
   Today, I meet ex-schoolteachers earning hundreds of thousands of dollars a year. They earn that much because they have specialized skills in their field as well as other skills. They can teach, as well as sell and market. I know of no other skills to be more important than selling and marketing. The skills of selling and marketing are difficult for most people, primarily due to their fear of rejection. The better 

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you are at communicating, negotiating, and handling your fear of rejection, the easier life is. Just as I advised that newspaper writer who wanted to become a best-selling author, I advise anyone else today.
   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.
   In addition to being good learners, sellers, and marketers, we need to be good teachers as well as good students. To be truly rich, we need to be able to give as well as to receive. In cases of financial or professional struggle, there is often a lack of giving and receiving. I know many people who are poor because they are neither good students nor good teachers.
   Both of my dads were generous men. Both made it a practice to give first. Teaching was one of their ways of giving. The more they gave, the more they received. One glaring difference was in the giving of money. My rich dad gave lots of money away. He gave to his church, to charities, and to his foundation. He knew that to receive money, you had to give money. Giving money is the secret to most great wealthy families. That is why there are organizations like the Rockefeller Foundation and the Ford Foundation. These are organizations designed to take their wealth and increase it, as well as give it away in perpetuity.
   My educated dad always said, “When I have some extra money, I’ll give it.” The problem was that there was never any extra. So he worked harder to draw more money in, rather than focus on the most important law of money: “Give, and you shall receive.” Instead, he believed in: “Receive, and then you give.”
   In conclusion, I became both dads. One part of me is a hard-core capitalist who loves the game of money making money. The other part is a socially responsible teacher who is deeply concerned with this ever-widening gap between the haves and have-nots. I personally hold the archaic educational system primarily responsible for this growing gap.


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