Summary of Retire Young and Retire Rich

Section 1 : The Leverage of your mInd.


  1. How to become rich and retire young?


One big difference between the rich and poor is their mindset. The poor always say that “I cant afford it”. Poor people use poor words and these words make them poor. You need to use rich and fast words in order to become rich. In this section you will find out how critical are these rich and fast words in your journey to retire young and retire rich. If you can choose your words and your thoughts to those of the rich,  retire young and retire rich will be easy.


  1. How did you do it?


By following rich dad’s three paths to great wealth,

  1. i) Increasing business skills.
  2. ii) Increasing money management skills

iii) Increasing investment skills


But there are many books on how to do it, then you may ask how this book is different from those books. This book mainly emphasizes on why to do it rather than how to do it. The why is more important which gives power to the how. The reason most people dont do what they can do is because they dont have strong why. So, before starting your journey to retire young and retire rich first find out why do you want to become rich.


  1.     b)  Why I decided to retire early?


Robert Kiyosaki had his personal why’s to retire early. You have to find out why you want to retire early before starting. After deciding why to retire early , it was not as easy as itt is said for the author they had faced lot of troubles and sometimes they dont even have a place to sleep and they slept in their car, but it was the reason why that kept us going. Author states that passion is the combination of love and hate. Unless someone has passion for something it is difficult to achieve anything. If you want something you don’t have, find out why you love what you want and why you hate what you don’t want. Prepare  a list of loves and hates and these two combined together gives you energy to achieve what you want.


  1. Why retire as young as you can?


When Robert took a year off from his work, initially it was difficult for him to not to work and stay idle and after lots of struggle he was able to find out why retiring early is important to anyone. During this time Robert can reflect back on his life and he could appreciate his life even though it was hectic, stressful and filled with problems. So take some time to reflect on your life now and then. You may be wondered to see what you thought important might not be important today.


  1. How I retired early?


Robert says that he was able to retire early because he used debt to fund his retirement. He also gives a example from a daily newspaper which shows a couple who retired at the age of 57. Robert brings the contrast between the couple and his own life describing how he has retired 10 years earlier than the husband in the newspaper and his wife kim 19 years earlier than the wife in the newspaper. The couple used to equity to fund their retirement whereas the author used debt to fund his retirement. The couple has used their money to invest in the stock market and the author has used the bank’s money to invest in real estate the couple cannot do this because banks won’t allow you to take money and invest in the stock market as it is risky. The other different method which allowed author to retire early is he won’t invest for capital appreciation but for the cash flow.


  1. Poor Dad’s Lessons:-


Poor dad always used to say “ Go to school, get good grades and find a secure job, work hard, save money.” Poor dad might had a good life if he has done what he has said but he did not do that. He borrowed money for the things that made him poor and refused to borrow money for the things that made him rich. These subtle differences between the rich dad and poor dad’s thinking made him to work until he died and couldn’t retire early. Those were the lessons he tried to pass on to the younger generations.


  1.     b)   Rich Dad’s Lessons:-

Rich dad would advice to ask such things as:


How long it would to take earn $1 million and borrow one million?

Who is going to get richer in the long run? Someone who works all their lives to save one million dollars? Or someone who knows how to borrow 1 million dollars at 10% interest rate and also knows how to invest and get 25% interest in return.

And so on….  

When it come to work, money, savings and debt, it is obvious that my two dads had completely different points of view. But the biggest difference in points of view is rich dad used to say:

The poor and middle class try to get rich by using their own money what they need to know is if they want to get rich they have to know how to use other people’s money to get rich…. Not your own. Robert has used debt as tool to get rich but it is not advised to only use debt to get rich. The main point author wants to convey here is to use some form of leverage to get rich it can be either debt or any other thing.


  1.    c) The second most important word:-


The first important word in the world of money is “Cash Flow”

The second important word is “Leverage”.

If you want to be rich you must learn to harness the power of the leverage. The difference between rich, poor and middle class is caused due to the different leverage they are using.


  1.    d) This book is about LEVERAGE:


Financial Leverage is the advantage the rich have over the poor and middle class. It is the leverage not hard work that brought financial freedom to kim and robert.


A Suggestion :

As debt is already mentioned as one form of the leverage you need to know the difference between Good debt and Bad debt.

Good debt is the debt that always puts money in your pocket and bad debt is vice versa.


4) How you can retire early:-

If you want to retire early and retire rich it is important that you understand the importance of the word leverage. It simply means the ability to do more with less.  Poor people use fewer leveraged tools than the rich if you want to keep up with the rich you need to understand the power of the leverage.  People without leverage work for the people with leverage.People who use financial tools of leverage are getting ahead financially. It is ironic that middle class people think that it is risky to use financial tools of leverage. Rich get ahead because they use financial tools of leverage and poor use physical leverage(hardwork). Debt can be used as one form of leverage and you have to be cautious because it can be winner’s leverage or loser’s leverage. Robert has used to debt to acquire the assets whereas many people use equity to get assets which takes long and time don’t have that much ROI.The one ironic thing is that poor and middle class people feel that it is risky to use debt as financial leverage but they go and buy liabilities using the debt.(house,car). Robert and Kim also used other forms debt such as OPT(other people’s money) and OPT to build an asset called business.Health, Time, Education and Relationships are other forms of leverage that you need to take care of. These are not only the forms of leverage you can use find the best leverage that works for you. Rich Day would say that leverage can be defined as our ability to do more and more with less and less. Rich are keep on adding more and more leverage while doing less and less work. Rich Dad always used to stress on the importance of the word and here. The rich never stop learning while the poor and middle class stop after primary or secondary education to get a job. This helps rich to add more and more leverage in proportional to their education.

One important question you should ask yourself all the time is: How can I do what I do for more people with less work and for a better price. Rich Dad called it a million dollar question.


Chapter 5: The Leverage of Your Mind:

This is the most important lesson for anyone who want to retire young and retire rich. Rich Dad could afford very expensive properties in Hawaii  even though he doesn’t have enough money and when I asked him how can he do that he taught me this lesson. RIch Dad always asked me and his son to forbade from saying “I can’t afford it”.So his lesson was “What you think is your reality”. My rich dad expansion of reality helped him to achieve all these goals. Robert and Kim also faced a stage where they have to expand their reality and had seen tremendous benefits after changing their reality. Poor and middle class people have different realities when it comes to rich and things you have to do to become rich like investing. Rich Dad always used think in terms of risk and reward ratio rather than in terms of smart and risky. He always know what the risk involved in it and if the reward reaping is higher than the risk than he would go for it.


Chapter 6:-

What do you think is risky?

This chapter shows how important it is for a individual to change his reality to become rich. Poor and middle class cannot become rich because they think that becoming rich is not for them or whatever the things rich do are considered as risky or they think rich are greedy. Rich dad says that the thinking of rich and other people is not different but it is opposite. Rich also do the same things as other people do but they do it with different thinking and different reality. For example other people think that getting job security is smart and building a business is risky but the rich think the opposite. For other people saving money is smart and investing is risky but for the rich investing is smart and saving is risky. Poor and middle class people think that the rich are greedy and selfish but rich dad says that the more generous you are the wealthier you become.

So, finally it is the rich people thinking and the reality that made them rich and same for the people that made them poor. You should also change your realities that are incorporated into you by your family.

Chapter 7:

How to Work less and Earn more.

Rich dad become rich rich and richer eventually because he know for what kind of income he has to work for. Poor dad was eventually becoming poor and poor because he was working for the wrong kind of income. Rich Dad classified income into three types they are

  1. Earned Income(The income an individual should not depend on) – 50% money
  2. Portfolio Income(The income which comes from paper assets) – 20% money
  3. Passive Income(The income from real estate and other intellectual properties) – 0% money

Rich dad says that one should always focus on increasing his passive and portfolio income rather than working continuously for the earned income. Rich Dad also suggested some of the lifehacks that you can use so that you can save money in taxes. Earned income is the highest taxed and portfolio is the second highest and next it is passive. As you increase your portfolio and passive income you will work less and lesser and earn more and more.


Chapter 8:

The Fastest way to get rich: A summary of mental leverage.

The summary of this section in one line can be “What you think is your reality”. If you think that you are poor, you can’t afford to be poor that is what you are. If you think in rich people’s mind set that is what you will become. You might have different reality up to now or different context imparted by your surroundings and ecosystem. Up to these guys suggested you to work hard get a job and work hard again. Now you need to change your context and content i.e. your reality. Changing your reality is similar to you asking you to eat with left hand after all these days of eating with right hand. It is easier said than done but you need to have an open mind to do anything that can help you to change your reality. Remember in this information age context is king and content is queen.


Section II:


Chapter 9:-

How fast is your plan:

Your plan determines how fast you can retire young and retire rich. It is not what you have or not it is all about how swiftly are you changing you context from day to day which determines how fast you can grow rich. To become rich you need to take the fast train rather than taking the slow train. In fast train you need to have fast ideas and also change your context as quickly as possible. Rich dad says that first step to investing is to choose out exit strategy. At what level you want to be when you retire poor, middle class, affluent, rich, ultra-rich.  If your plan is to retire at middle or affluent class you don’t need this book. You can board the slow train and reach affluent level but that won’t help you to reach rich or ultra rich. This is why first you have to determine your exit strategy. You have to take the fast train to reach rich and ultra rich levels. To take fast train you need to forgo the job security and should have an open mind to expand your reality. The advantage in reaching the affluent level in fast train is it will allow you to plan for rich and ultra rich levels. It gives the needed education, skills and other required things. Create a plan that works for you. Don’t follow others plan mind you don’t follow others plan. You should change your context with time otherwise you will be left behind and have to wait until the next fast track train comes. You should always stay updated have a vision for the future and keep on changing your reality. You won’t have much time to board onto the fast track train and if you are stuck in the past you can’t get into a fast track train. So always have an eye for the future.


Chapter 10:

The Leverage of seeing a rich future:

Rich dad always says “Your future is determined by what you do today not tomorrow”. If you want to be rich you have to plan today not tomorrow. Create fast plans and use fast words. The plan that you design today is the most important thing that determines your future tomorrow. If you want to become rich you  need to change your reality today not tomorrow. Start your future today, you should first begin with your mind , thoughts and your actions. You need to see your future with Vision rather than with your eyes. RIch Dad emphasize on how important it is to tune your brain to become rich. You need to use fast words which can change your reality and make you rich. Some fast words are Cash flow, make money, depreciation, gain control. Slow words corresponding to these fast words are High-paying job, save money, appreciation, risky.


Chapter 11:

The Leverage of Integrity:

In this section author emphasizes mostly on the importance of the words. He says that you are only as good as your words. Everyone knows the definition of the words but it’s crucial to know beyond only the definition, you have to make those words part of your life. As rich dad perceived asset and liability in a different which made him rich and book definition of these words is one of reasons for poor dad to not to become rich throughout his lifetime. To become financially strong you have to become accustomed with the jargon. But it is recommended to learn the things that gives more sense to your life. Instead of learning  words like P/E ratio and all try to learn what is your debt to equity ratio. Learn ratios that apply to your life. One of the ratios you must calculate now and then is wealth ratio: Passive income + Portfolio Income / total expenses.

If you are serious about retiring young and retiring rich then you have to make wealth ratio part of your life. Robert also speaks about integrity and it is the correlation between the person’s words and his actions. It is always recommended to have high integrity as it will help you in becoming rich very easily. At last Robert also states that most destructive word is “tomorrow” as he says tomorrow will never come whatever you have gotta do you have to do it today. Tomorrow is losers word and today is  winners word.


Chapter 12:

The Leverage of Fairy tales:

Author talks about how important it is remember some of the stories in your hard times to keep you going. Robert says that you have to as slow as tortoise to wait for the window of opportunity to open. He also states how rich dad used ugly duckling story to motivate him to retire young and retire rich. If you want to become a rich swann from an ugly duckling the first step you have to take is change your context and content or your reality. Author also gave an example of agreeing to buy a real estate property of around $35000 when he was strapped. At that point of time author realised that it is time to change expand their content and context i.e their is reality. This decision had brought significant changes in their lifestyles. Author also emphasizes on two other situations where he changed his context and content which led to radical changes in his lifestyle and also one of the trademark marks decisions that helped him to retire young and retire rich. As you progress in your journey to become richer it will become easy for you to become rich but one thing you have to be keen about is you have to be ready to expand your context and content(reality).


Chapter 13:

The leverage of generosity:

It is generally perceived that rich are greedy and that’s the reason they are rich. But author says that his rich dad has a different point of view. He said that all of us are greedy to some extent. So, if someone is rich it doesn’t mean that they are any greedier than other. In fact it could be opposite. He says that many people are not rich because they are not generous enough. The author also gives the examples of Henry Ford. How he become rich by providing cars to everyone in the world. Rich Dad also emphasizes on ratios in this chapter. The poor will have a ratios of 1:1 throughout their lifetime because they don’t expand their reality. It is always critical to expand your reality to become rich and to change your ratios. Robert also says that this is not only the path that you can follow to become rich, you can choose your own path to become rich. He chose this because he found it to be best choice for him. This is the right track for the turtles. In the cashflow quadrant people on the left side have limited earning potential while people on the right will have unlimited earning potential. This is because they will have exponential growth as they progress. The author describes the power of networks using metcalfe’s law. It states that the economic power of a business is the square of the number in the network. Networking marketing business are powerful because of this law. They can offer very powerful leverage to people like you and me. You have to understand the power of networks in the business they will help you to grow faster than what you can do alone. If you use the power of network you can become a billionaire very easily in less amount of time. You can see how fast Mark became a billionaire using the world wide web. Any business will grow exponentially if it is generous to its customers and it’s business owner is generous to its employees. Rich asked you to be generous because all of the business has to follow certain age old principles irrespective of whether they are new or old. Generosity comes under one of the age old laws. Rich Dad believed in the law of reciprocity and in the idea that being generous was the best to become rich and rich. RIch Dad always said that Start Small and Dream Big. Start by being generous to yourself. Poor remains poor because they treat themselves as poorly.

Section III : The Leverage of your actions:-

The first two sections of this book have discussed about how your mindset should be and how you have to plan to be rich. These things are important in becoming rich but ultimately it depends what you are going to do to become rich. This section emphasizes on the habits that you have to follow to acquire wealth which are easy for everyone to follow. After this section the only question left is: How badly do you want to become rich?


Chapter 14 : The Leverage of your Habits:


There are habits that make you rich and there are habits that make you poor. If you want to be rich all you have to do is train yourself with the rich habits.


  1. i) Hire a bookkeeper:-

     To manage your financial statements. You can also spend this money on something else but you have good investments and bad investments and good expenses and bad expenses. The advantages are your he wont be attached to your money emotionally. Can openly discuss about your money problems. The main objective to become rich is to mind your own business and for that you need an bookkeeper. Review your financial steps every month or quarter or whwnever it is possible and identify the flaws and do the improvements immediately and follow this process thoroughly.  


  1. ii) Create a Winning team:

    B and I quadrant are team sports and you need good team to be successful. What determines if someone is rich or poor is how they handle their financial problems. Get a good team of accountants or investment bankers or relevant persons sit with them understand everything that you have to know so that you can do better investments. Also discuss your financials with your team don’t keep them secret as my poor dad did. My rich dad always used to discuss his financials with his team and get insights from them. It is always better to get advice from the people who already have expertise in that area.


** iii) Constantly expand your context and content:

   We now live in an information age and not an industrial age. You need to be updated from the old industrial age techniques to the new information age techniques. Your greatest asset is the information you have in your head. Here are some of the things you can do to keep up with the information age. Nightingale-Conant’s audio library, Lead the field by Earl Nightingale, Making money on the web(Seth godin), Thinking Big(Brain Tracy), The art of exceptional Living by Jim Rohn, How to be a no lImit person(Dr. Wayne Dyer)


  1. iv) Keep Growing Up:

     The world is changing and growing more sophisticated so should we. Don’t do things in older ways keep updating yourselves. Growing up means you become less and less dependant on others.


  1. v) Be willing to fail more.


  1. vi) Listen to yourself:


Another way of expressing your reality or context. The most powerful force I have is what I say to myself and what I believe. Pay close attention what you are saying to yourself as that is what you are today and that is what you are going to become. In this context the main thing you have to do is, talk about the things you want and you want to do not about the things you don’t want and don’t want to do. The process to do that is:

Notice the thoughts you don’t want…. Change to thoughts about things you want

Notice the feelings you don’t want and……. Change to feelings you want.

Take action and keep going, correct if necessary until you get what you want rather that what you don’t want.


Chapter 18:

The Leverage of a B Quadrant business:


The richest self made people in the world are from the B Quadrant, because it is the hardest quadrant to be successful in. So, Rich Dad always suggests to start from that quadrant as others will become easy if you start from the hardest. Rich Dad says that this is the time you chose your exit level and before you chose that you need to identify what are your strength and weakness and chose which quadrant is best for you. Rich Dad always suggests to have more than one context in more than one quadrant. In this information age it is imperative that you have expand your context in more than one quadrants. Robert Kiyosaki also emphasizes on joining a network marketing business for the E and S quadrant people as it can reap huge benefits to the individuals. Rich Dad says that most people don’t build business because many don’t know how to work with people. If you can work with different people you can become rich beyond your wildest dreams. Successful entrepreneurs create great teams and work with great people. A person who wants to start a business must be a great leader, and all of us can work on improving our leadership skills. An entrepreneur is a person who can find an opportunity, put together a team and get profits out of the product. A leader is person who accepts the challenges in front of him and volunteer to do them. In every small task you volunteer you will learn many things about leadership.

Some of the books that can help you with the skills required for entrepreneurship are:

  1. i) The  monk and the riddle by Randy komisar.
  2. ii) First, break all the rules by Marcus Buckingham

iii) Emotional Branding by Daryl Travis.

  1. iv) Protecting your asset #1 by Michael Lechter.
  2. v) SalesDogs By Blair Singer

Robert shares one of his learnings about leadership from Vietnam war when he was soldier. They always believed that Mission comes first and then Team and then the Individual. This is very important for any organisation because this framework can put any organisation in success track.


Chapter 19: Hot Tips:


Rich Dad always used to say that to retire young and retire rich you need to live in a world where you don’t have a paycheck. He always made me and his son work for free and it always important to you also to expand your content and context to live in a world where there is no paycheck. Rich Dad also says that a high academic IQ is not sufficient to become rich you also need high financial IQ. Here are some tips for you to work on your financial IQ.

  1. i) Able to see you yourself in a world where there is no need of pay check.
  2. ii) Once you forget about paycheck the next step you have to do is ask What kind of income you want? Learn about different incomes and let the idea of different incomes settle in your mind don’t be in a rush to do something immediately. Remember the definition of Assets and Cash Flow by rich dad and buy assets not liabilities.

iii) Lie about your future to yourself and your close circle. In one of the author’s session he encountered a lady therapist who was explaining how to help the other people in imagining about their future of becoming rich and financially free. She told that whatever you say that is going to happen in a future is technically a lie as the event has not yet happened. So lie about your future positively and this often comes true because most of the people will have integrity with their soul. So instead of saying that I can never do that, I’ll be never rich. Lie to yourself that You will be rich and so on… who knows it may come true someday.


********************Tips you have to follow to retire young and retire rich********************


  1. i) Decide:


Decide how do you want to spend your life poor, middle class or rich. Remember a person with the poor context will say I’ll never be rich. The rich will have different context in expressing it. They say How can I afford it? So, decide your context and content as each day begins.


  1. ii) Find friends and loved ones who wants to go on the journey with you.

Choosing right friends and people is very crucial for your success. Be careful while choosing people who can help you achieve whatever you want.


iii) Seek competent advice and begin building your own team of financial and legal advisors.

Choosing the right people is an very important skill and they can be assets or liabilities. You can trust a mechanic easily when a car is in repair because you can judge the performance immediately after the repair but a wrong financial advice may also problems in the long term. The poor people remain poor because they spend more time on what car to buy rather than deciding on whom to take financial advice from. So, always take time to find best financial advisors that can be your best investment of time and money.


  1. iv) Set a retirement date. Sit with your loved ones and your financial advisors and set a date for your early retirement.

If you will actually do this process and discuss an actual date with these people your present context will begin to argue with your future context. It is a fun process to go through. You will definitely hear many different contexts and realities.


  1. v) Write a down a plan on a piece of paper once you set your early retirement date.


  1. vi) Plan your early retirement party.


vii) Look at a deal a day. Remember its costs you nothing to go shopping.

The point is to do something everyday to improve financial intelligence. Make a habit of doing something everyday to improve your financial education it can be as simple as reading business section of the newspaper.


viii) Remember that all markets follow three main trends.

They are up,down and sideways. The markets sometimes can fluctuate years together in these trends or it can change in one minute. So, don’t believe your financial advisor blindly ask him what he exactly meant when he gives an advice. If you want to get rich quickly , one of the best way to get rich is at the point where a trend changes. Being at the right place at the right time. If you follow advice 7 then you may end up in one of these situations sooner than you expected. This also keeps you aware about the trends of the market helps you to increase velocity of your money.


  1. ix) Check reguraly to update your financial knowledge and learn about new things.


  1. x) Always remember that words are free.

Rich Dad always talks about three different types of assets they are real estate, paper and business. These assets have their own words and their own language. If you are interested in one first learn those words and that language.  Words are most powerful tools we have as human beings. So, choose your words carefully. Basically there are two types of words one is regarding your content and the other is regarding your context.


  1. xi) Talk about money:


xii) Make a million dollars of money with nothing

This helps you to become an entrepreneur and also helps to broaden your context and content as the schools are only making bureaucrats. There is big difference between both of them. One is trained to live on paychecks and other can make money out of nothing.



The human brain is the most efficient and at the same time most underused asset. If you want to retire rich and retire early you don’t need money education and skills… etc etc. Instead of all that first start using your brain and you will eventually get whatever you want. If you follow all the tips mentioned above you can retire early and retire rich and if you observe all these things doesn’t need much money or education all they need is your brain and sincere effort.


How to keep GOING:


The only that kept me and kim and going is our search for a world where we need no money to become rich and no fear of any risk to lose anything. Initially we faced troubled to expand our reality to the world we are searching and we believed that, that kind of world never existed.But after expanding our reality we were able to realise our dream. You also have to expand your reality in search of the world that you desire for and that will give you the force to keep going irrespective of any hardships. May the force be with you.



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