ENUGU STATE UNIVERSITY OF SCIENCE AND TECHNOLOGY

DEPARTMENT OF BUSINESS MANAGEMENT

ASSIGNMENT ON ENTREPRENEURSHIP
RICH DAD POOR DAD BY ROBERT KIYOSAKY

BY

UKPAI BERNICE OGECHUKWU

COURSE TITLE: ENTREPRENEURSHIP DEVELOPMENT

LECTURER: PROF T.O ENUDU

DATE: MAY, 2025

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Rich Dad Poor Dad by Robert T. Kiyosaki: A Comprehensive Summary

Robert T. Kiyosaki’s Rich Dad Poor Dad (1997) is a seminal work in the field of

personal finance and financial literacy. The book is structured around a narrative

that contrasts the financial philosophies and life lessons imparted by two father

figures in Kiyosaki’s life: his biological father, referred to as the “Poor Dad,” and

his best friend’s father, referred to as the “Rich Dad.” Through these contrasting

figures, Kiyosaki conveys the differences in mindset, financial habits, and

educational values that lead to financial success or continued financial struggle.

Introduction to the Two Dads

The “Poor Dad” was a highly educated man with a Ph.D. and a steady government

job. He emphasized the importance of formal education, job security, and working

for a paycheck. Despite his academic credentials and stable career, he struggled

with money throughout his life. In contrast, the “Rich Dad,” who had limited

formal education, was a savvy businessman and investor. He taught Kiyosaki

lessons about money, investing, and wealth creation that went against traditional

norms. The core premise of the book lies in Kiyosaki’s comparison of these two

divergent viewpoints, ultimately advocating for the financial philosophy of the

Rich Dad (Kiyosaki, 2017).

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The Narrative Structure: Rich Dad vs. Poor Dad

At the core of Kiyosaki’s work is the juxtaposition of two father figures who hold

starkly different views on money, success, and education. His biological father, the

Poor Dad, was well-educated with a Ph.D. and held a secure government job. He

valued academic achievement, job security, and prudent living. Yet, despite his

education and professional status, he consistently struggled with money and

ultimately died in debt. In contrast, Rich Dad, who was an eighth-grade dropout

and a savvy businessman, built a vast business empire and taught Kiyosaki the

principles of wealth accumulation through investing and entrepreneurship

(Kiyosaki, 2017).

This dual-father narrative serves as an allegory for two dominant societal mindsets.

The Poor Dad represents the traditional belief system: go to school, get a good job,

work hard, and retire on a pension. This philosophy emphasizes job security and

conventional success. Rich Dad, on the other hand, advocates for financial

education, risk-taking, and leveraging money to create more money. The contrast

highlights how educational and cultural conditioning can trap individuals in cycles

of debt and financial dependence.

By using storytelling rather than didactic exposition, Kiyosaki humanizes complex

financial principles and makes them accessible to a broad audience. This narrative

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approach is part of the book’s enduring appeal and pedagogical effectiveness,

particularly among young adults and aspiring entrepreneurs.

Key Lessons from Rich Dad Poor Dad

Financial Education vs. Formal Education

One of Kiyosaki’s strongest critiques is directed at the formal education system,

which he argues is ill-equipped to prepare individuals for financial independence.

According to him, schools teach subjects like mathematics, history, and science but

neglect critical life skills such as budgeting, investing, managing debt, and

understanding taxes (Kiyosaki, 2017). This educational gap leaves many adults ill-

prepared to navigate financial challenges, leading them to rely on jobs for income

and accumulate debt through consumer habits.

Kiyosaki insists that the absence of financial literacy in school curricula

perpetuates generational poverty and economic ignorance. He posits that children

should be taught how to make money work for them, rather than being trained

merely to work for money. This perspective aligns with growing academic and

policy-based advocacy for integrating financial education into early schooling.

Lusardi and Mitchell (2014) highlight that financial literacy is strongly correlated

with improved financial decision-making, reduced debt, and better long-term

financial planning.

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Furthermore, Kiyosaki’s work reflects a broader shift toward alternative forms of

education, including self-learning, mentorship, and experiential learning. In an

economy where self-employment, freelancing, and investing are becoming more

prevalent, the need for practical financial skills has never been greater.

Assets vs. Liabilities: Redefining Wealth

A pivotal concept in Rich Dad Poor Dad is Kiyosaki’s redefinition of assets and

liabilities. Traditional accounting defines an asset as anything owned that has

economic value, while a liability is a financial obligation. However, Kiyosaki

simplifies this definition to emphasize cash flow: an asset is something that puts

money into your pocket, while a liability is something that takes money out

(Kiyosaki, 2017).

According to this view, a personal residence may not qualify as an asset if it does

not generate income. This redefinition challenges widespread beliefs, especially in

middle-class societies where home ownership is considered a hallmark of success.

Kiyosaki argues that many people become "house poor," tying up wealth in

properties that generate no cash flow but incur maintenance costs, taxes, and

mortgages.

Instead, Rich Dad teaches the importance of acquiring income-generating assets

such as rental properties, dividend-yielding stocks, bonds, and businesses. The goal

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is to build a portfolio that creates passive income—money earned with minimal

ongoing effort—which can ultimately lead to financial independence.

This philosophy resonates with financial experts advocating for the FIRE

(Financial Independence, Retire Early) movement, which also emphasizes income-

generating investments and minimalism as paths to early retirement (Collins,

2016). It also echoes modern portfolio theory, which promotes diversification and

risk-adjusted returns for long-term wealth building.

Cultivating a Wealth-Oriented Mindset

Another fundamental lesson from Rich Dad Poor Dad is the power of mindset in

shaping financial outcomes. The Poor Dad mentality is rooted in fear, caution, and

dependence on job security. Phrases like "We can’t afford it" or "Money doesn’t

grow on trees" are emblematic of this limiting mindset. Conversely, Rich Dad

instills a mentality of opportunity, empowerment, and creative problem-solving,

exemplified by the question, "How can I afford it?" (Kiyosaki, 2017).

Kiyosaki emphasizes that the rich think differently about money—they view it as a

tool to create freedom and influence. He argues that by changing one’s beliefs and

attitudes toward money, individuals can unlock new possibilities. This idea is

supported by behavioral economics, which demonstrates that financial outcomes

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are strongly influenced by psychological factors such as cognitive biases, attitudes,

and self-control (Shefrin, 2000).

Entrepreneurship thrives on a growth mindset—the belief that abilities and

intelligence can be developed through dedication and hard work. By encouraging

readers to adopt this mentality, Kiyosaki contributes to a broader movement in

personal development that stresses internal transformation as a precursor to

external success.

Risk, Failure, and the Learning Process

Traditional educational systems often condition people to avoid mistakes, penalize

failure, and seek security. Kiyosaki turns this notion on its head by promoting risk-

taking as a vital part of financial and personal growth. He criticizes the fear of

failure as a barrier that prevents individuals from stepping outside their comfort

zones and pursuing entrepreneurial ventures (Kiyosaki, 2017).

According to Kiyosaki, Rich Dad taught that failure is not something to fear but

a source of valuable lessons. Financial setbacks are inevitable, but the ability to

learn from them and adapt is what separates successful entrepreneurs from those

who remain stuck. This aligns with the lean startup methodology, which

emphasizes rapid prototyping, customer feedback, and iterative learning as keys to

innovation (Blank, 2013).

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Risk tolerance and resilience are increasingly recognized as critical traits in

modern economies marked by volatility and disruption. Whether launching a

business, investing in markets, or changing careers, the ability to manage and learn

from risk is essential for long-term success.

The Entrepreneurial Path and Cashflow Quadrant

Beyond personal finance, Rich Dad Poor Dad champions entrepreneurship as

the most reliable path to wealth creation. Kiyosaki argues that employees trade

time for money and are often taxed at higher rates, while business owners and

investors can leverage systems, capital, and tax advantages to build wealth

exponentially.

In his follow-up book, Cashflow Quadrant, Kiyosaki introduces four categories of

income earners: Employees (E), Self-employed (S), Business Owners (B), and

Investors (I). The rich predominantly operate in the B and I quadrants, where

income is not tied directly to time (Kiyosaki, 2011). The goal is to transition from

being an employee to becoming a business owner or investor.

This framework has influenced thousands of aspiring entrepreneurs to rethink their

career paths, especially in an era where technology has lowered the barriers to

entry in business, investment, and online commerce. Entrepreneurship offers

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autonomy, scalability, and the potential for financial independence—traits

increasingly valued in the post-industrial economy.

Impact and Relevance of Rich Dad Poor Dad

Rich Dad Poor Dad has had a profound impact on the field of personal finance. It

demystifies financial literacy and presents complex ideas in simple, digestible

narratives. The book has inspired millions to rethink their financial strategies,

pursue entrepreneurial ventures, and prioritize financial education. Critics have

sometimes noted that the book lacks specific investment strategies or that its

lessons are anecdotal. Nevertheless, its philosophical and motivational content

remains a valuable starting point for anyone seeking to take control of their

financial future (Lusardi & Mitchell, 2014).

Criticisms and Academic Reflections

Despite its popularity, Rich Dad Poor Dad has been the subject of academic and

critical scrutiny. Critics argue that the book is anecdotal and lacks empirical rigor.

The character of Rich Dad is possibly fictional, and many of the investment

strategies are presented without context, risk disclosure, or substantiation (Fox,

2005). Additionally, some financial planners caution that the book’s downplaying

of job security and emphasis on investing may mislead readers into

underestimating the importance of stable income and risk management.

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Nevertheless, the book’s impact is undeniable. It has inspired millions to rethink

their relationship with money and to pursue financial literacy. As an introductory

text, it succeeds in provoking thought and motivating action, even if it falls short

on technical instruction.

Conclusion

Robert Kiyosaki’s Rich Dad Poor Dad is more than just a book about money—it is

a guide to transforming one’s relationship with wealth, work, and education. By

contrasting the philosophies of the Rich Dad and the Poor Dad, Kiyosaki provides

readers with insights into how financial habits, mindset, and education shape one's

economic destiny. The book emphasizes the importance of financial literacy,

entrepreneurial thinking, and asset accumulation as the true foundations of wealth.

For those seeking financial independence, Rich Dad Poor Dad serves as a

powerful reminder that success begins with mindset and knowledge.

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References

Blank, S. (2013). The startup owner's manual: The step-by-step guide for building
a great company. K&S Ranch.

Collins, J. L. (2016). The simple path to wealth: Your road map to financial
independence and a rich, free life. JL Collins LLC.

Fox, J. (2005, January 25). Why Rich Dad, Poor Dad is a bad book. CNN Money.
https://money.cnn.com/2005/01/25/commentary/everyday/sahadi/

Kiyosaki, R. T. (2011). Cashflow quadrant: Rich dad's guide to financial freedom.

Kiyosaki, R. T. (2017). Rich dad poor dad: What the rich teach their kids about
money that the poor and middle class do not! Plata Publishing.

Lusardi, A., & Mitchell, O. S. (2014). The economic importance of financial

Shefrin, H. (2000). Beyond greed and fear: Understanding behavioral finance and
the psychology of investing. Harvard Business School Press.

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